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Do You Split All Belongings in Half During a Divorce?

Do You Split All Belongings in Half During a Divorce?

Divorce comes with a lot of uncertainty and major decisions. One of the biggest questions that most couples have at the beginning of the process is “Who gets what?” Unfortunately, the answer to that question is rarely straightforward. 

Many people assume that all belongings get split 50/50, but this isn’t always the case. So what goes into this determination?

Separate vs. Marital Property

The first step in determining who gets what is to classify the spouses’ assets as either separate or marital. Separate property includes assets that belong to just one spouse. While this usually means assets they owned before getting married, it could also include gifts or inheritances they received post-marriage that were meant for them exclusively. Unless there are other arrangements in place (such as a prenuptial agreement), these assets are seen as one individual’s property. 

Conversely, marital property refers to assets that both parties acquire throughout the marriage. This could include earnings, investments, and purchases such as a car or house. 

How Do States Divide Assets During a Divorce?

When it comes to splitting assets during a divorce, there aren’t any set rules or laws that all states follow. Instead, discrete states have their own legislation that usually follows either a community property or an equitable distribution system.

Equitable Distribution

Most states, including Michigan, use an equitable distribution approach when dividing assets. Here, it’s important to note that “equitable” does not necessarily mean “equal.” That is, rather than splitting the assets 50/50, the court looks at the bigger picture and attempts to arrive at a fair outcome for both parties.

This method can be particularly beneficial when the spouses’ financial situations are significantly skewed in one direction. For example, if one spouse sacrificed their career to care for children, the courts would consider that when dividing property.

Community Property Distribution

Nine states abide by community property distribution — a system in which the court splits all marital assets in half, regardless of other factors. While this system is faster and simpler, it offers less flexibility or room for negotiation. It also risks dramatically harming one spouse or unjustly rewarding another in the name of fairness.

Reaching a Property Settlement Agreement

While the above methods are the traditional approaches that many partners follow, some go into the divorce process with a predetermined idea of how they would like to split their assets. The good news is that you may be able to reach an agreement on your own, without major court involvement. To do so, you will need to draft a property settlement agreement and have it approved by a judge. 

With that being said, dividing belongings is often one of the most stressful and emotionally charged steps of going through a divorce. So when attempting to reach a settlement agreement, it’s normal to run into roadblocks or disputes.

Mediation is a helpful tool for couples in this situation. A mediator is a qualified and neutral third-party person — usually a divorce lawyer — who can help you resolve issues and work out a mutually agreeable solution. Whether you’re in the middle of negotiations and want a mediator or you just need help drafting a settlement agreement, a divorce attorney can help make the process smoother.

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