Marriage allows two people to join together and build their lives together. Spouses will provide each other with support, both emotional and financial, throughout their lives, working toward mutual goals, such as a stable retirement plan. Before the marriage begins, however, there are many important considerations, ranging from educational choices for your children to where to purchase a home. One very important consideration is the debt that both you and your spouse bring into the marriage. If you are marrying someone with debt, you should take measures to protect your own finances.
New Jersey is an “equitable distribution state,” which means that during a divorce, the parties’ marital assets and marital debts will be distributed equitably between the parties. However, separate assets and debts will not be divided. Separate property is generally defined as property that each spouse owned before marriage. Similarly, any debt that each party had before marriage is also separate. To make sure that these debts remain separate property, you should avoid mingling the debt of your spouse with your debt. For example, if your spouse has substantial credit card debt from before the marriage, do not put your name on the account and use a separate account or card to purchase items you and your spouse need during the marriage.
Another essential step is having an open and honest discussion with your spouse about debt before the marriage occurs. It is possible that your spouse has different expectations about spending or how debt will be paid. If your soon to be spouse is a spendthrift who tends to make only minimum payments on his or her credit cards each month, it will be even more important for you to maintain financial distance from your spouse’s pre-marital debt.
Spouses should be aware that if debt is accumulated during the marriage, it is likely that the debt will be considered marital debt and subject to division in the final order, even if only one spouse’s name is associated with the account. In other words, if your spouse continues to spend recklessly during the marriage, you could end up responsible for half of his or her credit card debt accumulated after you get married.
We have helped many people with creating a plan to protect their finances both before and after marriage. Call us today to talk about your goals
Are you interested in seeking an annulment? If so, contact Williams Law Group, LLC right away. Our family law attorneys will review your case to determine if an annulment is an option. If it is, we will guide you through the process and ensure you make the best decisions for your future. Call our office at (908) 810-1083, email us at info@awilliamslawgroup.com, or contact us through our confidential online form to schedule a consultation.
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