Except for the emotional trauma, figuring out how to divide the money and other assets is often the most challenging part of getting divorced. You and your spouse might each feel that you contributed more to the marriage, and the two of you likely have very different ideas about what to do with the family home, retirement savings and other valuables.
You may have heard that Pennsylvania and New Jersey are equitable distribution states. But unless you have been through divorce before, you might not know what that means. One thing to remember is that “equitable” property division is not the same thing as “equal” division. You do not have to split your assets 50/50; the law only requires that the division be reasonably fair to both sides. The other key point is that this rule applies only to marital property.
(Virtually) everything acquired during marriage
Essentially, marital property is anything you or your spouse acquired during your marriage, even if only one of you earned an income. The idea is that the non-income earning spouse’s contributions, such as keeping the house and being the primary child-carer, allowed the other spouse to focus on their career. Thus, both spouses are entitled to their fair share. Debts acquired during the marriage, such as credit card bills and student loans, are also divided up this way.
What about what I owned before the wedding?
Nonmarital property includes things that one spouse owned prior to the marriage, though nonmarital cash and other assets can become marital property through “intermingling.” This means a person’s property was combined with their spouse’s, such as by opening a joint bank account. But as long as you can show that you kept a nonmarital asset separate during the marriage, you get to keep it. There are also exceptions to the marital asset rule, such as gifts and inheritances specifically given to one spouse alone.
It is not uncommon for divorcing spouses to dispute what counts as marital or nonmarital property. Careful preparation and a sound negotiation strategy can go a long way towards reducing conflict and reaching a practical and reasonable settlement.