When someone receives an inheritance, it can really change how they view their future. A person’s parents may leave them enough money so they can retire whenever they want, giving them flexibility in their careers and long-term financial stability.
But what happens if you are going through a divorce? If you have already received an inheritance from your parents, does the divorce mean you are going to have to split the money with your ex? Or should the inheritance stay with you, even after the marriage ends?
Is it a marital asset?
The key thing to remember is that marital assets generally do need to be divided, while individuals can keep separate assets. When you first receive an inheritance, as long as it was not given to both you and your spouse jointly, it is likely a separate asset. Your parents intended it to be a gift for you, and you own it exclusively.
If you kept the money separate so that only you had access to it, it likely retains that status. Even during a divorce, you still keep the inheritance.
But if you commingle the inheritance with other financial assets, then it may become a marital asset. For instance, maybe you and your spouse had a joint investment account and you put the inheritance in it to let the money grow. Your spouse may be able to argue that the investment account is a marital asset, so the entire fund has to be divided.
Property division disputes
Issues like this often lead to conflicts during a divorce, especially with a significant inheritance. Be sure you know what legal options you have at this time.