#assetsanddivorce

[amarallaw]

Does My Spouse Have an Interest in My Business When We Divorce?

In a divorce, money can be one of the biggest issues spouses fight over.  However, when one (or both) spouses own a business, this can be an even more complicated (and sometimes uglier) fight.  A common question business owners ask when they are going through a divorce is whether their spouse has an interest in the business.  The short answer is yes, but it’s not as straightforward as you think.   Under Massachusetts law, all assets owned by spouses, regardless of whether or not they are joint assets, are marital assets.  This can include a family owned business, even if only one spouse has an interest in that business.  That means the business is a marital asset that is subject to division in equitable distribution.  However, that doesn’t necessarily mean the non-business owner spouse will end up owning the business or having a financial stake in the business through the divorce.  Massachusetts General Laws chapter 208, section 34 outlines factors the Probate and Family Court must consider in the division of marital assets.  Those factors are:   Length of marriage.   Conduct of the respective parties during the marriage.   Ages of the respective parties.   Health of the respective parties.   Station of the respective parties.   Occupations of the respective parties.   Amount and sources of income of the respective parties.   Vocational skills of the respective parties.   Employability of the respective parties.   Estates of the respective parties.   Liabilities of the respective parties.   Needs of the respective parties.   Current needs of the minor children of the marriage.   Future needs of the minor children of the marriage.   Opportunities available to the respective parties for future acquisition of capital.   Opportunities available to the respective parties for future acquisition of income.   Contributions of the respective parties in the acquisition, preservation or appreciation in value of their estates.   Contributions of Husband and Wife as homemaker.   These factors must be considered as a whole.  However, one factor that often is given a little more weight on this issue is the “Contributions of the respective parties in the acquisition, preservation or appreciation in value of their estates.”  Here, the court looks at what the non-business owner spouse contributed toward the business.  Did they help out at the business with any work such as bookkeeping or administrative support?  Did they help with any business dinners or important business meetings and events?  What a spouse contributed towards the business can be an important factor.   However, another important factor is “Contributions of Husband and Wife as homemaker.”  Did the non-business owner spouse take care of the children and the household so the business owner spouse could have more time to manage the business?  If the non-business owners spouse did help in this capacity, this can be another important factor in what, if anything, the non-business owner spouse is entitled to from the business.   The Probate and Family Court will also consider when the business owner spouse acquired an interest in the business.  Was it several years before the couple was married, and the business owner spouse put in their own work before the marriage to make the business profitable? Or was the business acquired only months before the divorce was filed?  These are also important factors.   As if analyzing the Section 34 factors isn’t enough, the Probate and Family Court will also need to know what the business is worth.  This often requires a business appraisal by a financial expert certified to appraise businesses.  These appraisals can be costly, but the return can be potentially significant.  In doing a business appraisal, the expert commonly puts a monetary value on the business owner spouse’s interest in the business, but will also set a salary for which support can be calculated.  This is where things can get confusing.   Although a business owner spouse is drawing an income from that business, it may not be the “correct” income based upon business appraisal standards.  Some common issues that the appraiser must consider are: 1) is the business owner using the business to pay his/her own personal expenses; 2) is the business owner working a normal number of hours; 3) does someone else in the business (oftentimes a relative) have the control to manipulate the spouse’s income.  This all has to be factored into valuing the business and also coming up with the business owner’s appropriate income.   Once this is all considered, then it’s time to decide what, if anything, the non-business owner spouse is entitled to from the business.  Oftentimes, the salary that has been calculated by the business appraiser is used to calculate child support and/or alimony.  After that, once a value is set for the business owner spouse’s interest in the business, the court determines what the non-business owner spouse is entitled to.  If the Court determines that the non-business owner spouse is entitled to share a of the business, this is usually accomplished not by the spouse actually acquiring an ownership interest in the business, but by receiving a payout by the business owner spouse.  Sometimes this is made in the form of one lump-sum payment, and other times it is made in installment payments over time.  Either, way, the non-business owner spouse is monetarily compensated for their share in the business.   Determining a non-business owner spouse’s interest in the other spouse’s business can be complex and confusing. It is important to ensure you have a knowledgeable divorce attorney and a business appraiser to guide you through this process, regardless of which side you are on. Read the full article

[amarallaw]

Does My Spouse Have an Interest in My Business When We Divorce?

In a divorce, money can be one of the biggest issues spouses fight over.  However, when one (or both) spouses own a business, this can be an even more complicated (and sometimes uglier) fight.  A common question business owners ask when they are going through a divorce is whether their spouse has an interest in the business.  The short answer is yes, but it’s not as straightforward as you think.   Under Massachusetts law, all assets owned by spouses, regardless of whether or not they are joint assets, are marital assets.  This can include a family owned business, even if only one spouse has an interest in that business.  That means the business is a marital asset that is subject to division in equitable distribution.  However, that doesn’t necessarily mean the non-business owner spouse will end up owning the business or having a financial stake in the business through the divorce.  Massachusetts General Laws chapter 208, section 34 outlines factors the Probate and Family Court must consider in the division of marital assets.  Those factors are:   Length of marriage.   Conduct of the respective parties during the marriage.   Ages of the respective parties.   Health of the respective parties.   Station of the respective parties.   Occupations of the respective parties.   Amount and sources of income of the respective parties.   Vocational skills of the respective parties.   Employability of the respective parties.   Estates of the respective parties.   Liabilities of the respective parties.   Needs of the respective parties.   Current needs of the minor children of the marriage.   Future needs of the minor children of the marriage.   Opportunities available to the respective parties for future acquisition of capital.   Opportunities available to the respective parties for future acquisition of income.   Contributions of the respective parties in the acquisition, preservation or appreciation in value of their estates.   Contributions of Husband and Wife as homemaker.   These factors must be considered as a whole.  However, one factor that often is given a little more weight on this issue is the “Contributions of the respective parties in the acquisition, preservation or appreciation in value of their estates.”  Here, the court looks at what the non-business owner spouse contributed toward the business.  Did they help out at the business with any work such as bookkeeping or administrative support?  Did they help with any business dinners or important business meetings and events?  What a spouse contributed towards the business can be an important factor.   However, another important factor is “Contributions of Husband and Wife as homemaker.”  Did the non-business owner spouse take care of the children and the household so the business owner spouse could have more time to manage the business?  If the non-business owners spouse did help in this capacity, this can be another important factor in what, if anything, the non-business owner spouse is entitled to from the business.   The Probate and Family Court will also consider when the business owner spouse acquired an interest in the business.  Was it several years before the couple was married, and the business owner spouse put in their own work before the marriage to make the business profitable? Or was the business acquired only months before the divorce was filed?  These are also important factors.   As if analyzing the Section 34 factors isn’t enough, the Probate and Family Court will also need to know what the business is worth.  This often requires a business appraisal by a financial expert certified to appraise businesses.  These appraisals can be costly, but the return can be potentially significant.  In doing a business appraisal, the expert commonly puts a monetary value on the business owner spouse’s interest in the business, but will also set a salary for which support can be calculated.  This is where things can get confusing.   Although a business owner spouse is drawing an income from that business, it may not be the “correct” income based upon business appraisal standards.  Some common issues that the appraiser must consider are: 1) is the business owner using the business to pay his/her own personal expenses; 2) is the business owner working a normal number of hours; 3) does someone else in the business (oftentimes a relative) have the control to manipulate the spouse’s income.  This all has to be factored into valuing the business and also coming up with the business owner’s appropriate income.   Once this is all considered, then it’s time to decide what, if anything, the non-business owner spouse is entitled to from the business.  Oftentimes, the salary that has been calculated by the business appraiser is used to calculate child support and/or alimony.  After that, once a value is set for the business owner spouse’s interest in the business, the court determines what the non-business owner spouse is entitled to.  If the Court determines that the non-business owner spouse is entitled to share a of the business, this is usually accomplished not by the spouse actually acquiring an ownership interest in the business, but by receiving a payout by the business owner spouse.  Sometimes this is made in the form of one lump-sum payment, and other times it is made in installment payments over time.  Either, way, the non-business owner spouse is monetarily compensated for their share in the business.   Determining a non-business owner spouse’s interest in the other spouse’s business can be complex and confusing. It is important to ensure you have a knowledgeable divorce attorney and a business appraiser to guide you through this process, regardless of which side you are on. Read the full article

[amarallaw]

Financial Planning For and During a Divorce

A divorce brings about many changes in a person’s life.  One of the most significant changes is the financial impact of a divorce.  Spouses go from having a combined household with (usually) two separate incomes, to living apart, and supporting themselves on their own.  If you are contemplating a divorce, or have already filed for divorce, there are different actions you can take to plan for your own financial future after a divorce.   Create a Budget:   Review your household expenses to see what your weekly/monthly expenses come out to.  In addition to including the usual expenses (i.e. mortgage/rent, utilities, heat, cable TV, telephone, groceries, clothing, etc.), don’t forget to include other typical expenses, such as uninsured medical expenses, motor vehicle expenses, child care, vacation and entertainment, education costs for yourself and your children. Once you have your budget, look at what your income is, and what it is likely to be at the end of the divorce.  Don’t forget to factor in any alimony and/or child support that you may be paying or receiving. Based upon the budget you create, you can figure out whether you need to make any cuts in the budget, where you can.  Also, if based upon your budget, you can determine what assets may be best for you to walk away with in the divorce, once marital assets are divided. Determine What Your Income Will Be: As part of your budget, you will want to consider what your income will be after the divorce.  If you are working, you will know what your income will be from work.  However, you will also want to consider if you will be receiving or paying child support and/or alimony. In Massachusetts, a child support order can run until children are 23 years old, provided they attend college.  Spouses must take this into consideration when factoring their income.  Massachusetts has Child Support Guidelines for spouses to calculate the child support order based on their respective incomes.  Generally, the first $250,000 of the parties combined gross income is used to calculate child support. As for alimony, if the parties have children, and have a combined gross income of over $250,000, then there is a chance that the lesser earning spouse could receive alimony.  There are exceptions to this $250,000 gross income, where a spouse may receive alimony and the parties do not have a combined gross income of $250,000, but these are highly fact-specific circumstances.  If there are no children of the marriage, then there is no minimum income used to calculate alimony.  However, that doesn’t guarantee that alimony will be awarded.  There are many factors considered in awarding alimony, as outlined in M.G.L. c. 208 §53.  Each spouse should consult their respective attorney to determine whether there will be an alimony order in their case. If alimony is awarded in a case, it will be based upon a formula developed when the Massachusetts Alimony Reform Act of 2011 went into effect.  There 4 types of alimony in Massachusetts: 1) General Term Alimony; 2) Rehabilitative Alimony; 3) Reimbursement Alimony; and 4) Transitional Alimony.  Depending on the specific facts of your circumstances, any one of these types of alimony could be awarded in your divorce.  The amount and duration of the alimony will depend on the type of alimony awarded.   Determine What Assets You Will Receive in the Divorce: As part of a divorce, all marital assets are divided.  This includes all bank accounts, investment accounts, retirement accounts, stocks, future inheritance, real estate, business interests, vehicles, personal property, and any other property owned by the spouses.  When negotiating the division of assets, consider your income and your budget.  Is it more beneficial to you to receive liquid assets, such as investment accounts, or is it better for you to receive real estate?  The answer to this question is always fact-specific, but you should consider your circumstances, and what would meet your needs most once the divorce is finalized. Retaining real estate can give some continuity, particularly if you are retaining the marital home for the children to continue living in.  However, real estate doesn’t make cash available to you immediately.  The real estate can appreciate or depreciate, and you will not get your equity out of the real estate until it is sold.  Whereas, liquid accounts will give you access to money fairly quickly. Each person should also consider the tax consequences of retaining each asset, as there usually are tax benefits or tax penalties for retaining or transferring certain assets. There is no “one size fits all” answer to this question.  Each person should review their financial circumstances to determine what works best for himself/herself.   Start Your Financial Independence from Your Spouse: Towards the beginning of your divorce, you will want to begin your financial independence from your spouse.  Massachusetts has a prohibition on depleting, transferring, or encumbering marital assets, pursuant to Supplemental Probate and Family Court Rule 411, so you cannot unilaterally deplete, cash out, or transfer any assets.  However, you can begin your financial independence by opening your own individual bank account.  Once the account is opened, you can begin depositing your income into this account, and using this account for your regular living expenses. You may also want to open a credit card account without your spouse as a joint user.  That way you begin to build credit in your name alone. By taking these steps, you begin to segregate your finances from your spouse, and begin to understand how to manage your money without your spouse’s involvement.   Consult a Financial Advisor Depending on the total value of the marital estate, and each spouse’s gross incomes, it may be wise to retain a Financial Advisor, to assist you through the divorce process and give you guidance as to a budget, the tax consequences of divorce, and also what assets you should retain.  There are financial advisors who specialize in divorce, known as Certified Divorce Financial Analysts, who can guide you through this process.   Read the full article

[amarallaw]

Financial Planning For and During a Divorce

A divorce brings about many changes in a person’s life.  One of the most significant changes is the financial impact of a divorce.  Spouses go from having a combined household with (usually) two separate incomes, to living apart, and supporting themselves on their own.  If you are contemplating a divorce, or have already filed for divorce, there are different actions you can take to plan for your own financial future after a divorce.   Create a Budget: Review your household expenses to see what your weekly/monthly expenses come out to.  In addition to including the usual expenses (i.e. mortgage/rent, utilities, heat, cable TV, telephone, groceries, clothing, etc.), don’t forget to include other typical expenses, such as uninsured medical expenses, motor vehicle expenses, child care, vacation and entertainment, education costs for yourself and your children. Once you have your budget, look at what your income is, and what it is likely to be at the end of the divorce.  Don’t forget to factor in any alimony and/or child support that you may be paying or receiving. Based upon the budget you create, you can figure out whether you need to make any cuts in the budget, where you can.  Also, if based upon your budget, you can determine what assets may be best for you to walk away with in the divorce, once marital assets are divided. Determine What Your Income Will Be: As part of your budget, you will want to consider what your income will be after the divorce.  If you are working, you will know what your income will be from work.  However, you will also want to consider if you will be receiving or paying child support and/or alimony. In Massachusetts, a child support order can run until children are 23 years old, provided they attend college.  Spouses must take this into consideration when factoring their income.  Massachusetts has Child Support Guidelines for spouses to calculate the child support order based on their respective incomes.  Generally, the first $250,000 of the parties combined gross income is used to calculate child support. As for alimony, if the parties have children, and have a combined gross income of over $250,000, then there is a chance that the lesser earning spouse could receive alimony.  There are exceptions to this $250,000 gross income, where a spouse may receive alimony and the parties do not have a combined gross income of $250,000, but these are highly fact-specific circumstances.  If there are no children of the marriage, then there is no minimum income used to calculate alimony.  However, that doesn’t guarantee that alimony will be awarded.  There are many factors considered in awarding alimony, as outlined in M.G.L. c. 208 §53.  Each spouse should consult their respective attorney to determine whether there will be an alimony order in their case. If alimony is awarded in a case, it will be based upon a formula developed when the Massachusetts Alimony Reform Act of 2011 went into effect.  There 4 types of alimony in Massachusetts: 1) General Term Alimony; 2) Rehabilitative Alimony; 3) Reimbursement Alimony; and 4) Transitional Alimony.  Depending on the specific facts of your circumstances, any one of these types of alimony could be awarded in your divorce.  The amount and duration of the alimony will depend on the type of alimony awarded. Determine What Assets You Will Receive in the Divorce: As part of a divorce, all marital assets are divided.  This includes all bank accounts, investment accounts, retirement accounts, stocks, future inheritance, real estate, business interests, vehicles, personal property, and any other property owned by the spouses.  When negotiating the division of assets, consider your income and your budget.  Is it more beneficial to you to receive liquid assets, such as investment accounts, or is it better for you to receive real estate?  The answer to this question is always fact-specific, but you should consider your circumstances, and what would meet your needs most once the divorce is finalized. Retaining real estate can give some continuity, particularly if you are retaining the marital home for the children to continue living in.  However, real estate doesn’t make cash available to you immediately.  The real estate can appreciate or depreciate, and you will not get your equity out of the real estate until it is sold.  Whereas, liquid accounts will give you access to money fairly quickly. Each person should also consider the tax consequences of retaining each asset, as there usually are tax benefits or tax penalties for retaining or transferring certain assets. There is no “one size fits all” answer to this question.  Each person should review their financial circumstances to determine what works best for himself/herself.     Start Your Financial Independence from Your Spouse: Towards the beginning of your divorce, you will want to begin your financial independence from your spouse.  Massachusetts has a prohibition on depleting, transferring, or encumbering marital assets, pursuant to Supplemental Probate and Family Court Rule 411, so you cannot unilaterally deplete, cash out, or transfer any assets.  However, you can begin your financial independence by opening your own individual bank account.  Once the account is opened, you can begin depositing your income into this account, and using this account for your regular living expenses. You may also want to open a credit card account without your spouse as a joint user.  That way you begin to build credit in your name alone. By taking these steps, you begin to segregate your finances from your spouse, and begin to understand how to manage your money without your spouse’s involvement.   Consult a Financial Advisor Depending on the total value of the marital estate, and each spouse’s gross incomes, it may be wise to retain a Financial Advisor, to assist you through the divorce process and give you guidance as to a budget, the tax consequences of divorce, and also what assets you should retain.  There are financial advisors who specialize in divorce, known as Certified Divorce Financial Analysts, who can guide you through this process. Read the full article

[amarallaw]

Can I Modify My Separation Agreement?

It is not uncommon for a spouse to want to modify certain provisions of his or her Separation Agreement after a divorce.  As time goes on, circumstances will most certainly change for the former spouses.  However it is important that spouses make any changes through the Probate and Family Court, and not through a private agreement, as private agreements are not enforceable through the courts.   Before a spouse can seek a modification in the court, he/she must first ascertain if the provision he/she wants modified can be modified.  In Massachusetts, Separation Agreements either “merge” or survive”.  When a separation agreement “merges” it means that all provisions in the agreement may be modified through a Complaint for Modification, upon a showing of a material change in circumstances.  When a separation agreement “survives” it means it has its own independent legal significance, and can only be modified in the rarest of circumstances.  The courts have stated that there must be “countervailing equities” to modify a surviving agreement.  Although the term “countervailing equities” has not exactly been defined by the court, it has generally meant the most extraordinary circumstance will permit a modification, such as a person becoming a ward of the state absent a modification.   Also, certain parts of a separation agreement can merge, and other parts can survive.  Almost always, provisions regarding division of marital property and marital debt, survive, so those provisions can only be modified in the rarest of circumstances.  Provisions regarding children, such as custody, the parenting plan, child support, and payment of college costs, almost always merge, and can be modified.  Other provisions, such as life insurance and alimony, can survive or merge, depending on a case-by-case basis.   Thus, if a provision of a separation agreement has merged, and a spouse would like to modify this provision, then upon a showing of a material change in circumstances, the spouse may obtain a modification.   A modification may be obtained in two ways.  One, if the other spouse does not agree to the modification, then the spouse must file a Complaint for Modification and proceed with a contested modification action.  However, if both spouses agree to a modification, they may jointly file a Joint Petition for Modification pursuant to Supplemental Probate and Family Court Rule 412.  The Joint Petition method is faster and more cost effective, as there typically is no hearing in court on the Joint Petition; rather the court handles the Joint Petition administratively.   Modification actions are certainly not uncommon.  However, spouses should always make sure any modification is adopted by the Probate and Family Court, so the modification is official, and may be enforced, should one spouse not live up to the terms of the modification.     Read the full article

[amarallaw]

Can I Modify My Separation Agreement?

It is not uncommon for a spouse to want to modify certain provisions of his or her Separation Agreement after a divorce.  As time goes on, circumstances will most certainly change for the former spouses.  However it is important that spouses make any changes through the Probate and Family Court, and not through a private agreement, as private agreements are not enforceable through the courts.   Before a spouse can seek a modification in the court, he/she must first ascertain if the provision he/she wants modified can be modified.  In Massachusetts, Separation Agreements either “merge” or survive”.  When a separation agreement “merges” it means that all provisions in the agreement may be modified through a Complaint for Modification, upon a showing of a material change in circumstances.  When a separation agreement “survives” it means it has its own independent legal significance, and can only be modified in the rarest of circumstances.  The courts have stated that there must be “countervailing equities” to modify a surviving agreement.  Although the term “countervailing equities” has not exactly been defined by the court, it has generally meant the most extraordinary circumstance will permit a modification, such as a person becoming a ward of the state absent a modification.   Also, certain parts of a separation agreement can merge, and other parts can survive.  Almost always, provisions regarding division of marital property and marital debt, survive, so those provisions can only be modified in the rarest of circumstances.  Provisions regarding children, such as custody, the parenting plan, child support, and payment of college costs, almost always merge, and can be modified.  Other provisions, such as life insurance and alimony, can survive or merge, depending on a case-by-case basis.   Thus, if a provision of a separation agreement has merged, and a spouse would like to modify this provision, then upon a showing of a material change in circumstances, the spouse may obtain a modification.   A modification may be obtained in two ways.  One, if the other spouse does not agree to the modification, then the spouse must file a Complaint for Modification and proceed with a contested modification action.  However, if both spouses agree to a modification, they may jointly file a Joint Petition for Modification pursuant to Supplemental Probate and Family Court Rule 412.  The Joint Petition method is faster and more cost effective, as there typically is no hearing in court on the Joint Petition; rather the court handles the Joint Petition administratively.   Modification actions are certainly not uncommon.  However, spouses should always make sure any modification is adopted by the Probate and Family Court, so the modification is official, and may be enforced, should one spouse not live up to the terms of the modification.     Read the full article

[amarallaw]

Financial Planning For and During a Divorce

A divorce brings about many changes in a person’s life.  One of the most significant changes is the financial impact of a divorce.  Spouses go from having a combined household with (usually) two separate incomes, to living apart, and supporting themselves on their own.  If you are contemplating a divorce, or have already filed for divorce, there are different actions you can take to plan for your own financial future after a divorce.   Create a Budget:   Review your household expenses to see what your weekly/monthly expenses come out to.  In addition to including the usual expenses (i.e. mortgage/rent, utilities, heat, cable TV, telephone, groceries, clothing, etc.), don’t forget to include other typical expenses, such as uninsured medical expenses, motor vehicle expenses, child care, vacation and entertainment, education costs for yourself and your children. Once you have your budget, look at what your income is, and what it is likely to be at the end of the divorce.  Don’t forget to factor in any alimony and/or child support that you may be paying or receiving. Based upon the budget you create, you can figure out whether you need to make any cuts in the budget, where you can.  Also, if based upon your budget, you can determine what assets may be best for you to walk away with in the divorce, once marital assets are divided. Determine What Your Income Will Be: As part of your budget, you will want to consider what your income will be after the divorce.  If you are working, you will know what your income will be from work.  However, you will also want to consider if you will be receiving or paying child support and/or alimony. In Massachusetts, a child support order can run until children are 23 years old, provided they attend college.  Spouses must take this into consideration when factoring their income.  Massachusetts has Child Support Guidelines for spouses to calculate the child support order based on their respective incomes.  Generally, the first $250,000 of the parties combined gross income is used to calculate child support. As for alimony, if the parties have children, and have a combined gross income of over $250,000, then there is a chance that the lesser earning spouse could receive alimony.  There are exceptions to this $250,000 gross income, where a spouse may receive alimony and the parties do not have a combined gross income of $250,000, but these are highly fact-specific circumstances.  If there are no children of the marriage, then there is no minimum income used to calculate alimony.  However, that doesn’t guarantee that alimony will be awarded.  There are many factors considered in awarding alimony, as outlined in M.G.L. c. 208 §53.  Each spouse should consult their respective attorney to determine whether there will be an alimony order in their case. If alimony is awarded in a case, it will be based upon a formula developed when the Massachusetts Alimony Reform Act of 2011 went into effect.  There 4 types of alimony in Massachusetts: 1) General Term Alimony; 2) Rehabilitative Alimony; 3) Reimbursement Alimony; and 4) Transitional Alimony.  Depending on the specific facts of your circumstances, any one of these types of alimony could be awarded in your divorce.  The amount and duration of the alimony will depend on the type of alimony awarded.   Determine What Assets You Will Receive in the Divorce: As part of a divorce, all marital assets are divided.  This includes all bank accounts, investment accounts, retirement accounts, stocks, future inheritance, real estate, business interests, vehicles, personal property, and any other property owned by the spouses.  When negotiating the division of assets, consider your income and your budget.  Is it more beneficial to you to receive liquid assets, such as investment accounts, or is it better for you to receive real estate?  The answer to this question is always fact-specific, but you should consider your circumstances, and what would meet your needs most once the divorce is finalized. Retaining real estate can give some continuity, particularly if you are retaining the marital home for the children to continue living in.  However, real estate doesn’t make cash available to you immediately.  The real estate can appreciate or depreciate, and you will not get your equity out of the real estate until it is sold.  Whereas, liquid accounts will give you access to money fairly quickly. Each person should also consider the tax consequences of retaining each asset, as there usually are tax benefits or tax penalties for retaining or transferring certain assets. There is no “one size fits all” answer to this question.  Each person should review their financial circumstances to determine what works best for himself/herself.   Start Your Financial Independence from Your Spouse: Towards the beginning of your divorce, you will want to begin your financial independence from your spouse.  Massachusetts has a prohibition on depleting, transferring, or encumbering marital assets, pursuant to Supplemental Probate and Family Court Rule 411, so you cannot unilaterally deplete, cash out, or transfer any assets.  However, you can begin your financial independence by opening your own individual bank account.  Once the account is opened, you can begin depositing your income into this account, and using this account for your regular living expenses. You may also want to open a credit card account without your spouse as a joint user.  That way you begin to build credit in your name alone. By taking these steps, you begin to segregate your finances from your spouse, and begin to understand how to manage your money without your spouse’s involvement.   Consult a Financial Advisor Depending on the total value of the marital estate, and each spouse’s gross incomes, it may be wise to retain a Financial Advisor, to assist you through the divorce process and give you guidance as to a budget, the tax consequences of divorce, and also what assets you should retain.  There are financial advisors who specialize in divorce, known as Certified Divorce Financial Analysts, who can guide you through this process.   Read the full article