You file for divorce. Your spouse doesn’t react well. They’re angry. You hoped they would be civil, but you knew this was a possibility. If anything, it just reinforces your view that you need to end the marriage.
However, you worry that your spouse will try to do everything in their power to get back at you during the divorce. The main thing you believe they’ll do is attempt to hide assets. They want to keep as much of the family’s wealth as possible, even if that means being less than honest or even breaking the law.
How can you tell? It’s tough. The key is to understand what your assets look like in advance. What should you expect? What do you really own? This sounds simple, and it may be with some assets — a car, a house, etc. — but it gets complicated with other assets, like investment accounts, pension plans, business funds and the like. You must know what those accounts contain and what you really own — right down to the last cent.
When you do, you can then consider these common ways that people hide assets:
- Delaying earnings. For instance, maybe your spouse runs a business and has a $250,000 deal in the works. It’s supposed to go through any day. They may just keep putting it off so that they don’t “earn” that money during your marriage, instead waiting until after the split.
- Paying too much. Your spouse could pay too much in taxes, for example, or for some other major purchase. They could then get divorced while the money is out of their accounts, then get a refund after the divorce.
- Giving it away. This is perhaps one of the most common schemes. Your spouse just needs a friend or family member who will work with them. They then give that person a large “business loan” or a “gift.” They know full well that the person will give it back after the divorce. Remember, this doesn’t just happen with money. Your spouse could give away a second car, a boat, some artwork or other valuable assets.
- Simply claiming they forgot about various accounts. Your spouse may do this if they feel like you don’t understand the family’s finances. They may report the checking accounts and other cash that you see and use, but they may “forget” that they invested money or received stock options. They just hope you never knew they existed to start with.
Do you think your spouse will hide assets? That’s all of the red flags that you need. Make sure you look into the legal options you have and what you can do to make sure the divorce process is legal and fair.