Florham Park Legal Blog

Divorce and remarriage in New Jersey are very common in this day and age. Complex family structures are often one result of this phenomenon. One result of all of this is more complex estate planning. When both partners have offspring from prior marriages and possibly children together from the new marriage, they may want to ensure that children are provided for fairly after their deaths.

Estate plans occasionally need to be updated and a new marriage would be one of those occasions. If one spouse wants to ensure that part of one's estate goes to the children of a previous marriage and not everything to the surviving spouse there are options. The simplest is that one spouse designates part of an estate to the children and part to the surviving spouse. Another option involves creating a trust for the surviving spouse that would provide a distribution to the surviving spouse for the duration of his or her life and the balance would then pass to the children.

With the increasing amount of divorcing marriages in the country, the states have incorporated more ways for couples to separate depending on the condition of their marriage and their properties. Litigation can be costly and leads to intense arguments in the courtroom, but it might be the best option for couples who cannot agree at all in the settlement. Mediation is known as a more peaceful option, but some divorcees are unsatisfied with how one person gets to determine everything.

So what happens if you and your spouse find yourselves in between? You want to settle the divorce peacefully, but there are still several assets you have disagreements on where a mediator might not be the best option. Thankfully, New Jersey established the Family Collaborative Law Act a couple of years ago, allowing couples to have a more peaceful option than litigation while still settling with some difficult areas of your marital assets.

The decision to divorce in New Jersey is seldom made lightly. Once the decision has been reached, there are a number of issues to be addressed. Not least among these is the division of assets. Among assets that are occasionally overlooked in divorce proceedings are items such as life insurance policies and 401(k)s. It's not that their existence is overlooked, but that the designated beneficiary status is, and in many cases, a spouse is designated as the primary beneficiary.

Failure to change the beneficiary can result in unintended consequences. If an ex-spouse is named as a primary beneficiary on a life insurance policy or retirement account, he or she may receive the funds, even if that was not the intent of the decedent. In some states, including New Jersey, a law now exists that replaces the contingent beneficiary as the primary upon dissolution of the marriage based on the belief that the deceased did not intend for the funds to go to an ex-spouse and that failure to change the information was an oversight.

Divorce brings with it many financial concerns and considerations in New Jersey. People considering divorce may want to establish some level of financial independence prior to a divorce. There are many options and issues to be considered.

One of the first things to do to obtain financial independence is to establish individual accounts in lieu of jointly held accounts. This will assist in establishing a credit rating but not necessarily how the accounts will be parsed in a divorce. New Jersey is an equitable division state. This means that assets and liabilities amassed in a marriage are divided fairly, but not necessarily equally, in a divorce settlement. For example, credit card debt, regardless of whether the account is individual or joint is considered marital debt in the eyes of the divorce court.