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2 financial issues that affect financial security after divorce

| Jul 6, 2023 | Divorce |

Living the best life possible after divorce often means approaching the process with the right attitude and knowledge. Divorcing spouses in Maryland have to divide their property and also work out arrangements for any children that they share with each other.

At the end of the process, spouses either agree with one another on certain key terms or ask a judge to settle their disagreements. During financial negotiation or litigation, there are two common approaches – that are, ultimately, misconduct – by one spouse that can lead to a less appropriate and fair solution for the other.

The dissipation of marital assets

Someone who doesn’t want to share their property with their spouse might damage, destroy or give away marital property. They might also empty bank accounts or spend every last available cent of credit on a credit card. When one spouse intentionally takes steps to reduce the value of the marital estate, that dissipation may potentially influence how a judge divides property in the divorce. They might exclude a debt accrued vindictively right before filing the divorce from property division completing or consider the value of assets given away or destroyed when dividing other property.

The possibility of hidden assets

To reasonably and fairly divide property between two people, a judge has to understand what assets and income they accrued throughout the marriage. The same is true of a spouse requesting a fair settlement in their divorce. They can’t set realistic expectations if they don’t actually understand the marital estate.

Some people hide physical property or drastically underestimate what their assets are worth to deprive their spouse of part of the marital estate. Others will have a secret bank account or other assets that they never shared with their spouse despite acquiring them with marital income. Some people have to go over their household financial records very carefully to track down signs of hidden assets so that they can claim their fair share of the marital estate in their divorce.

Understanding the most common types of financial misconduct that influence the outcome of divorces may help people better prepare for their upcoming divorce negotiations or family court.