In North Carolina, couples who wish to end their marriage must live separately for at least one year and one day. Fulfilling this separation period is a requirement in order to officially file for a divorce.
However, life does not just stop during that year. A lot can happen, as you earn, spend and invest. On top of that, the economy is almost in a constant flux. So, what happens to all these assets gained – or lost – throughout this separation period? Do they have to be divided in the divorce as well?
Answer: Yes and no
Generally, it depends on what kind of property you are talking about. North Carolina law makes it clear that the marital property you will divide in divorce includes assets you accrued between the day you were married and the date of separation, or the first day of your separation period.
That being said, there are certain types of assets amassed during your separation period that could still be subject to division. The law refers to this property as “divisible property,” which could include:
- The appreciation in value of marital assets during this time
- Increases or decreases in interest on marital investments or debts during separation
- A bonus you receive as a result of work completed during the marriage
It is important to seek financial guidance and monitor these changes carefully during your separation period.
What about the other assets you obtain during this year?
Just as the law states, you must divide marital property in your divorce, and marital property is accrued between the day you got married and the day your separation begins. Therefore, assets you obtain after your separation period starts will generally not be subject to division in your divorce.
Every day items you purchase during the separation period will be yours to keep. Even bigger ticket items, like the new kitchen table and chairs you buy, will most likely not have to be divided.
Even so, it is a good idea to take care with your budget and spend wisely during the separation period. Using joint accounts or marital funds to make many or significant purchases could lead to questions and concerns about the dissipation of marital assets.
You want to make sure you are financially secure for the next chapter of your life. Understanding exactly how you will divide your property, as well as what will be divided, can help you prepare and navigate your separation period accordingly.