It has been said that ignorance is a bliss. If so, the bliss that comes from avoiding one’s marital finances is a bliss that quickly fades when divorce looms and financial information comes to light.
Don’t be fooled by stock images that imply women are more likely to be shocked by a couple’s finances –
Financial mistakes to avoid when preparing for divorce
From my experience, although the issue can go either way, women tend to be more involved with the couple’s finances and tend to be more adept at quickly producing financial documents.
With that said, the act of avoiding your marital finances can hurt your interests in several important ways. Here are common divorce mistakes to avoid:
A spouse that exclusively handles a couple’s finances has a better opportunity to plan for the divorce case
A spouse that lacks financial knowledge enters the divorce at a disadvantage because they are unclear about each party’s income, assets and debts. Ultimately this spouse is blindly walking into the divorce case and lacks an accurate financial picture regarding the assets and debts that were accumulated during the marriage.
A lack of financial information also increases the difficulty for one’s attorney to take immediate steps in the right direction.
Often discovery must be completed to achieve an accurate financial picture. This process can take months, a fact that can delay requests for interim support, or a delay a response to mounting debt or leaking assets.
Know your finances and stop mounting debt during the marriage in New Mexico
A common misconception with divorce is that debt that is accumulated in only one spouse’s name is considered separate debt. Under New Mexico law, both spouses are responsible for debt that is accumulated during the marriage.
Money that is earned by either party is community money that is split 50-50 upon divorce. Nevertheless, the court only has jurisdiction (power) to divide traceable assets that are accumulated from the money that is spent. In other words, New Mexico family courts will not reimburse a spouse for community money that was spent during the marriage, but cannot be traced to a specific asset. This general rule comes into play in marriages where one party uses large degrees of community money for gambling — or any number of activities that do not generate an asset. In these situations the court will deny reimbursement of community money that was spent, but did not create a divisible asset.
Know your finances and stop shady spending and transferring of money or assets
New Mexico courts only have jurisdiction (power) over assets and debts in the couple’s name, at the time that the Petition for Divorce and Temporary Domestic Order are filed and served on the other party.
Because of this fact, at times, the spouse that is solely responsible for the couple’s finances can transfer money or property to a third party. Possibly the spouse will “gift” large sums of money to a family member, over a number of years. Potentially, one spouse will transfer property to a family member or friend, during the marriage. Assuming that these acts happen before the divorce is filed and served, with the court’s jurisdiction (power) attaching, the court would ultimately lack jurisdiction over the money or assets in a third party’s name.
Problems with allowing a spouse to completely handle the finances:
- Accumulated debt;
- Spending large sums of community money with no traceable asset;
- Transferring community funds or assets to third parties:
- Spending or transferring retirement accounts, and other accumulated funds, during the marriage.
(505) SANCHEZ IS HERE TO ANSWER YOUR QUESTIONS ABOUT FINANCIAL MISTAKES THAT HURT YOUR DIVORCE CASE IN ALBUQUERQUE, NEW MEXICO
Do you still have questions about financial mistakes that hurt your divorce case in Albuquerque, New Mexico? child custody and divorce lawyer in Albuquerque, New Mexico often require the experienced hand of an Albuquerque divorce lawyer. Matthew Legan Sanchez is an experienced Albuquerque family lawyer that can resolve your issue. Sanchez can be reached by calling (505) SANCHEZ.
Financial mistakes that hurt your divorce in Albuquerque
