When your parents passed away a few years ago, they left you over $1 million as an inheritance. You and your spouse both make a nice living, so you didn’t need it at the time, but you plan to retire with it. You may even be able to retire early.
Your spouse has since asked for a divorce, however. You figured they were just giving up on those retirement plans and their portion of the inheritance. But now they are demanding that you split the money with them, claiming that they also have a right to it.
It’s clear to you that they were also planning to use it for retirement and may have no Plan B. They don’t want to give that up. But does that mean you have to split it with them? You feel like your parents wanted you to have it and, if they knew you were getting divorced, they wouldn’t want it to go to your ex.
Is the money separate or did it get mixed with other assets?
The biggest question to ask is simply how you kept the money. Where was it stored? Who used it, if anyone?
The default in most cases is to allow the person whose parents left the money to keep all of it. The inheritance is not considered marital property.
However, if it was commingled, or mixed with other marital assets, then your ex may have a point. They may have been granted a right to that money at the time it was commingled.
In other words, if you kept the money set aside for yourself, it’s still your money. If you shared it with your spouse and let them use it, you gave up sole control and gave them an equal right to it.
Commingling itself can happen in a few different ways. The most common is to use a joint account. But you may also do it if you use the money for mortgage payments or other joint bills.
Is your divorce going to be complicated?
When you have complex financial questions during a divorce, it definitely pays to know about all of the legal options at your disposal.