Asking for a Friend: I recently began divorce proceedings against my husband and I’ve read that the divorce settlement may not need to be 50/50, is that true?

August 15, 2022

Question: I recently began divorce proceedings against my husband and I’ve read that the divorce settlement may not need to be 50/50, is that true?

Answer: Amy Irvine, who is a CDFA®, on our team provides the following answer to your question:

You didn’t indicate what State you live in, so I first need to explain the difference between community property States (there are 9 - Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin) and equitable property States (all the remaining).

  • Community Property State: each spouse equally owns any assets and debts gained during the marriage and therefore those assets get equally divided during a divorce.  Even if the asset was acquired prior to marriage, the earnings and growth during the marriage would be considered community property.

  • Equitable Property State: Although equal and equitable may sound the same, they are not.  Equitable means the assets are divided based on what is fair, which does not necessarily mean 50/50. In most of the cases I’ve been involved in, the pre-marital assets, and their earnings and growth, are excluded and other factors (such as tax brackets, earning potential, etc.) are taken into consideration.

The Institute for Divorce Analysts (the organization that my designation is through) has some good “get started” resources you may find helpful and that you might want to explore: IDFA Online Learning: U.S. Resources (institutedfa.com)

Divorce is stressful and the right team can give you guidance through this process.  Often, that right team, in our experience, includes an attorney, a financial planner, and a therapist.


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