Texas is one of only nine “community property” states in the nation. That means that whatever is accumulated during the marriage (with certain exceptions) is considered community property and will be divided equally among couples at the time of divorce.
It is important to remember this because, though most states call for an equitable distribution of marital assets, assets will not necessarily be divided up equally when a marriage has ended. Thus anyone looking for advice regarding asset division in Texas should avoid consulting on such a matter with attorneys from another state. A general understanding between the differences of Community Property states and non-Community states may not be adequate as state and local divorce rules can also affect how property is divided.
Nevertheless, financial planning from state to state in certain respects remains the same. Assets acquired prior to the marriage are usually exempt from any division at the time of the divorce, and prenuptial agreements are still a good idea for individuals that want to make their own decisions as to how property is divided – rather than rely upon courts to do it for them.
Prenuptial agreements will not cure all ills when it comes to disagreements over property division, however. State laws can affect whether these agreements are actually valid, and this is just one more reason to consult with attorneys when drawing agreements up or looking for alternative ways to divide the property.
In any case, planning and good communication between the two spouses can prevent headaches from occurring later on.
PalisadesHudson.com, “Planning for the Possibility of Divorce,” Benjamin C. Sullivan, CFP, June 10, 2013
