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Beware of asset depletion in divorce

On Behalf of | Nov 2, 2016 | Divorce

An Arizona person who is divorcing may be concerned about the other spouse dissipating assets. In some relationships, one spouse may have been a high earner while the other stayed home to care for the children. This stay-at-home spouse may not have had the opportunity to develop marketable job skills, and the assets dissipated may be trivial for the earning spouse. For the other spouse, they may make the difference between financial security and poverty after divorce.

To prevent asset dissipation, a person may want to seek a court order precluding the other party from altering the couple’s financial situation. However, in some cases, it may already be too late, and a person will need to try to prove that asset depletion has taken place.

Sometimes, this can be determined by looking over records such as credit card statements. If it cannot be easily determined, a person may want to hire a forensic accountant to examine financial records and trace where money may have gone. Even after this is uncovered, asset depletion can be difficult to prove. It is necessary to demonstrate that it was unusual, frivolous and substantial.

Whether or not people are concerned about asset depletion, they may want to meet with their attorney to discuss how they can protect themselves financially. Poverty rates for divorced people are higher than for married people, and protecting assets and retirement accounts and making sure that child and spousal support are paid and that they receive a fair property division settlement can be critical to a person’s financial security after the marriage ends.