Empowering Families

Someone called me today asking how she can keep the money she had when she got married separate when she’s getting divorced. I get that question all the time: How do I keep my separate money separate? So, I’ve put together four tips, and I’ll give you the opportunity to download a PDF at the end of this video if you’re interested in learning more.

I’m Katherine Miller, and I’ve been a matrimonial and family lawyer in New York City and New York State for over 30 years. My first tip is to get a prenup. If you’re already married and don’t have one, it might be too late, although you could consider a postnuptial agreement. That can be a clear way to determine what stays with each spouse upon divorce and what gets divided.

The second tip is to keep your separate assets separate. Don’t mix them with marital money. It’s easy to inadvertently mix them, such as with a 401k. For example, you have your 401k, everything is fine. You go on your honeymoon, return to work, and your employer makes a matching contribution. Your first paycheck after your wedding day goes into your 401k, and now you’ve mixed marital and separate funds. So, it’s crucial to be mindful of this.

The third tip is to open new accounts. If you have money in your 401k, roll it over into an IRA outside your 401k. This keeps your money separate, and you can build a marital 401k separately.

The final tip is to avoid putting your spouse’s name on your separate assets, even if it seems convenient. This is called transmutation, and it can easily turn your separate property into marital property.