Dividing assets is a key part of any divorce in New Jersey. For couples with outstanding debts, dividing them is a key part of the process as well. As with all parts of the process, dividing assets and debts requires informed decision-making, and both spouses should work closely with an experienced Vineland divorce lawyer who can help them make informed decisions with their long-term best interests in mind.
Important Facts for Divorcing Spouses to Know About Dividing Assets and Debts in New Jersey
The decisions you make during your divorce can impact your life for years, and perhaps decades, to come. With this in mind, here are seven practical considerations for preparing to divide your assets and debts during the divorce process:
1. Some Assets and Debts Are Subject to Division in New Jersey, While Others Are Not
In New Jersey (as in other states), some assets and debts are subject to division during the divorce process, while others are not. For purposes of a divorce, all assets and debts fall into one of two categories:
- Marital Assets and Debts – Marital assets and debts are jointly owned by both spouses and are subject to division during the divorce process. These generally include any assets and debts acquired during the spouses’ marriage.
- Separate Assets and Debts – Separate assets and debts belong individually to one spouse and are generally not subject to division. While assets and debts can be categorized as “separate” for a few reasons, the most common reason is that one spouse acquired the asset or incurred the debt before getting married.
While these are the general rules, there are exceptions. For example, in some cases, assets or debts that were separate can become marital assets or debts over the course of a couple’s marriage. Additionally, if the spouses entered into a prenuptial or postnuptial agreement, their agreement may specify that certain assets and debts are (or aren’t) subject to division.
2. You Need to Know Which Assets and Debts Are on the Table in Your Divorce
With the distinction between marital and separate assets and debts in mind, it is important to make sure you know which assets and debts are on the table in your divorce. While you should work with your Vineland divorce lawyer to confirm, you can begin by creating lists of all of the assets and debts that you think are either: (i) marital assets or debts; (ii) your separate assets or debts; or (ii) your spouse’s separate assets or debts.
3. New Jersey Law Requires an Equitable Distribution of Marital Assets and Debts
When dividing marital assets and debts during the divorce process, spouses must focus on ensuring an “equitable distribution.” This is mandatory under New Jersey law. While “equitable” can mean “equal,” an equal distribution won’t necessarily make sense in all scenarios. Divorcing spouses must consider New Jersey’s equitable distribution factors and apply them based on the specific circumstances of their divorce.
4. Establishing Financial Support and Dividing Assets and Debts Often Go Hand-in-Hand
Establishing financial support (i.e., alimony) is a key part of the divorce process as well, and establishing financial support and dividing assets and debts often go hand in hand. For example, if you are likely to have sole responsibility for one or more debts after your divorce, it will be important to make sure that you have the financial resources necessary to make your payments while also maintaining the standard of living you have enjoyed during your marriage.
5. Divorcing Spouses Have the Flexibility to Find a Solution that Works for Both of Them
While there are many considerations when dividing assets and debts during the divorce process, divorcing spouses have the flexibility to find a solution that works for them. Ultimately, if both spouses are willing to consider reasonable options for dividing the assets and debts that are on the table, they should be able to find a mutually agreeable path forward. With that said, the spouses’ respective divorce lawyers can play a critical role in the process, as both spouses need to have reasonable expectations based on a clear understanding of New Jersey law.
6. There Are Options for Avoiding Divorce Litigation if Your Negotiations Break Down
Let’s say you and your spouse can’t find a way to come to terms. If your negotiations break down, what can you do to avoid ending up in divorce litigation?
Even in highly contentious divorces, there will almost always be a mutually agreeable path forward. When divorcing spouses can’t reach an agreement on their own, mediation can be a highly effective tool. In mediation, the mediator offers recommendations without taking either spouse’s side, and their job is to help the spouses consider options they haven’t already considered on their own.
7. Giving Your Divorce the Attention It Deserves Will Help You Avoid Issues in the Future
Finally, while comprehensively addressing all your marital assets and debts during the divorce process can be time-consuming (and at times stressful), it is well worth the time and effort. If you give your divorce the attention it deserves, this will help you avoid contentious (and potentially costly) issues in the future.
For example, you do not want to find out years down the line that you and your former spouse are both still named on a loan that your former spouse was supposed to have paid off after your divorce. These kinds of issues can present a variety of challenges, and these are challenges that you can—and should—avoid with the help of an experienced Vineland divorce lawyer.
Schedule a Confidential Initial Consultation with a Vineland Divorce Lawyer at Helmer, Conley & Kasselman, P.A.
Do you have questions about dividing assets and debts during the divorce process in New Jersey? If so, we invite you to get in touch. To schedule a confidential initial consultation with a Vineland divorce lawyer at Helmer, Conley & Kasselman, P.A., please call 877-435-6371 or request an appointment online today.