You may have invested in a diverse portfolio of stocks as a means of generating revenue using your existing capital, or you may have invested strategically in specific stocks to support a company or a concept. The goal of investment is often to diversify how you hold your capital and secure a higher return than could be achieved with basic interest rates.
Stocks are often a long-term investment, as they offer the best returns when a company succeeds for many years. Your stocks may be an important part of your retirement plans or could be a major part of the legacy that you hope to pass on to your children or grandchildren.
Will you have to worry about dividing the stock you own when you file for divorce in Connecticut?
Equitable distribution rules apply to investments
Although you may have purchased your stocks using your own income, they could still be subject to division. While your spouse has never contributed to your holdings, they could potentially request their share of the stocks under equitable distribution rules.
Property acquired during the marriage or purchased using marital income is typically subject to division. In other words, if you bought the stocks during the marriage, you may have to share their value with your spouse even if your spouse has no interest in owning stock.
You don’t necessarily have to sell the stock now, but you will have to disclose your holdings and determine how much of their current worth is marital property. You may then have to negotiate an arrangement where your spouse receives an appropriate amount of marital assets to make your retention of your stocks fair and appropriate.
The only time that you could protect your investments from division in divorce is when there’s clear documentation that it is your separate property. Whether you owned it prior to marriage, protected it in a prenuptial agreement or inherited your stock, you can avoid dividing it if you can show it was your separate property and not part of the marital estate. Otherwise, you’ll have to at least consider their value when dividing your property with your spouse.
Learning more about property division matters in Connecticut divorce proceedings and reviewing your marital estate can help you set realistic expectations for the divorce process period.