134: Character Matters Part 1: Understanding Community Property in Divorce and Estate Planning

Absolute Trust Talk

Did you know that in California, any property acquired while married is considered Community Property? This means that, regardless of who bought it, the ownership is split 50/50 in the case of divorce. It also means that if you die without valid estate planning documents, your spouse automatically receives 100% of the ownership. If we’re talking about Separate Property, that’s a slightly different story, and of course, there are always exceptions to the rule. This episode of Absolute Trust Talk kicks off our Character Matters series, where we’re diving deep into the important distinctions between these two types of property and why you need to understand this for estate planning purposes. Let’s get started!

Time-stamped Show Notes:

0:00 Introduction

0:38 To start, we’re sharing the “celebrity situation” that inspired this new Character Matters series of discussions.

2:26 Before going too far, let’s clarify the basic definitions of our terms. Listen in to learn the key differences between Community Property and Separate Property.

4:35 While Community and Separate Property definitions are straightforward, some situations aren’t. Here’s a great example.

6:33 If you pass away without a valid will or trust, your Community Property automatically goes to your surviving spouse. But what about Separate Property? Here’s what you need to know.

8:38 Did you know you can get a higher tax exemption with Community Property than Separate Property?

10:29 We get asked a lot about the pros and cons of getting married, and even though finances and assets probably aren’t the main factors in determining your relationship, there may be some circumstances where they influence whether you should officially move forward.