Can I protect my court settlement from a divorce?

On Behalf of | Jul 5, 2019 | Divorce | 0 comments

An impending divorce on top of a recent personal injury can add greater stress to your life that you do not need. If you have secured a Tennessee court settlement for your injury, you might fear your divorce will wipe away much of that settlement. However, personal injury settlements are not considered marital assets and are generally not subject to division. Still, this does not mean that you should not take steps to guard your settlement.

First of all, you might not have a divorce pending or one does not appear to be on the horizon. You might not even be married yet. If so, according to Nerdwallet, you can protect a court settlement that you might receive in the future by spelling out in a prenuptial agreement that your court settlements should not be considered marital assets. If you are already married, you can make the same stipulations in a postnuptial document.

In the event you do receive a generous injury settlement and you do not have a prenup, or even if you do, it is important to make sure the settlement proceeds are not mixed in with your existing marital assets. Depositing personal money in a bank account you own with your spouse can cause a court to designate the money as marital property and subject to division. Therefore, it is best to keep court settlement money in a separate bank account.

These same strategies can be used to safeguard other separate assets that you may receive, like gifts from family or inheritances. Keep in mind that questions of marital and separate property take many forms, so for this reason, do not consider this article as legal advice. Only read it for your educational benefit.