Q: Is it beneficial to separate assets prior to dissolution of marriage? We have agreed to who gets what - house & car

A: Good Afternoon,

You ask an excellent question. First, let me say that I am very sorry to hear that you are going through tough times. In most folks' lives, the divorce process is fraught with fear and uncertainty. Let me reassure you, this too shall pass and there is an "other side" to this process.

In terms of the wisdom and ease of transferring the property before vs. after the initiation of a divorce, there are many factors to consider and frankly, there are pros and cons both ways. Without knowing more about you and your circumstances, as a practitioner, I tend to lean toward waiting until after the proceedings have begun and the other party is properly joined as a party to the case. This is my general preference because of the Automatic Temporary Injunction (more on that, below) that goes into place once the case is started. My generalized concern is that when the equity in a home turns into a liquid asset (cash) there is a significantly higher risk of the consequences of foul play or other less-than-beneficial behavior.

I sincerely wish you only the absolute best in all that life has to offer.

*Colorado Automatic Temporary Injunction Information:

The automatic injunction that goes into effect in every Colorado divorce case can be found under C.R.S. § 14-10-107(4)(b)(I). Under the order, the following automatic orders are in effect for all divorce cases:

(I) Upon the filing of a petition for dissolution of marriage or legal separation by the petitioner or copetitioner or by a legal guardian or conservator on behalf of one of the parties and upon personal service of the petition and summons on the respondent or upon waiver and acceptance of service by the respondent, a temporary injunction shall be in effect against both parties until the final decree is entered or the petition is dismissed or until further order of the court:

(A) Restraining both parties from transferring, encumbering, concealing, or in any way disposing of, without the consent of the other party or an order of the court, any marital property, except in the usual course of business or for the necessities of life and requiring each party to notify the other party of any proposed extraordinary expenditures and to account to the court for all extraordinary expenditures made after the injunction is in effect;

(B) Enjoining both parties from molesting or disturbing the peace of the other party;

(C) Restraining both parties from removing the minor child or children of the parties, if any, from the state without the consent of the other party or an order of the court; and

(D) Restraining both parties, without at least fourteen days' advance notification and the written consent of the other party or an order of the court, from canceling, modifying, terminating, or allowing to lapse for nonpayment of premiums, any policy of health insurance, homeowner's or renter's insurance, or automobile insurance that provides coverage to either of the parties or the minor children or any policy of life insurance that names either of the parties or the minor children as a beneficiary.

A: The divorce proceedings will not necessarily be any quicker simply because the two of you have already transferred and / or divided assets. You can certainly take some actions to help move things along such as filing the case together, i.e. Petitioner and Co-Petitioner. Both of you will still have to complete sworn financial statements and exchange financial disclosures; however, you may also want to begin working on a separation agreement (property and financial agreement), and be ready to get that filed along with any other required documentation close in time to the 91 day statutory waiting period after the case has been filed.