What if your spouse were to empty your bank accounts in the process of a divorce? Or what if they accuse you of doing so?
The dissipation of marital assets – such as draining or emptying accounts – is when someone squanders or hides assets to avoid a fair distribution of property. However, if you spend money while you navigate divorce, will that be dissipating the assets?
Short answer: No
Simply spending money is not dissipating marital assets. After all, it is your money too, even if it is in a shared account. Not to mention it would be difficult – if not impossible – to navigate daily life without spending money.
So, what would be dissipation? Dissipation of marital assets often includes:
- Excessive, out-of-the-ordinary spending
- Sudden lump-sum transfers from accounts
- Giving away significant amounts of money or significant assets
Anything that purposefully drains assets from marital accounts spouses would divide in a divorce could be dissipation. For example, an expensive shopping spree or splurging on big-ticket items out of the blue may raise questions.
Still concerned? Consider these questions first
There are a few key questions to ask yourself if you worry about spending or wish to avoid the risk of dissipating assets. Consider:
- Is it wasteful?
- Is it misusing assets?
- Is this spending out-of-the-ordinary for you?
If the answer is no, then spending is not dissipating assets. It is still a good idea to be careful when spending during the process of your divorce, especially as you prepare for your financial future post-divorce. However, you do not have to worry about dissipating assets regarding your normal spending, from groceries to household needs.
Keeping a financial record can help too
Whether it is to ease your worries or avoid potential issues in the future, you can maintain a record of your spending throughout the process of your divorce. Online banking sources often help do this for you. They keep track of credit card purchases, deposits and withdrawals.
However, you can also create a spreadsheet depicting:
- Your budget during the divorce
- A list of necessary bills to pay
- Your spending habits and disposable income
A record like this will help handle issues – or potential accusations – that arise during the divorce and negotiations of property division under North Carolina’s rules. Managing financial matters throughout a divorce can be complex, but maintaining a record can help you organize and protect your finances.