When you prepare for a divorce, there are critical steps you should take to secure your finances. However, protecting your financial future also means avoiding certain actions.
Here are a few things you should not do during your divorce.
3 divorce don’ts with your money
You and your ex-spouse must divide your marital property, as you know from North Carolina law. To obtain a fair division, you should make sure you:
- Don’t make large transfers: Unless you and your spouse agree on it, you should not move significant sums from your shared bank account. While you should consider opening a bank account of your own, you must take great care moving forward – especially before you divide any assets.
- Don’t make big purchases: As we have discussed in previous blog posts, making significant purchases before or during the divorce could potentially be considered a dissipation of assets. In other words, spending in order to prevent your spouse from getting their fair share of marital assets. So, it is a good idea to save any significant purchases for after you finalize the divorce.
- Don’t overlook assets: Yes, you must divide all your marital assets. So, you must make sure you take an inventory of this property and all of your financial accounts. Then, you should also make sure you understand the rules for how to handle and divide these assets and accounts. For example, when it comes to dividing a retirement account like a 401(k), you must obtain a Qualified Domestic Relations Order (QDRO) to avoid tax penalties.
Knowing what not to do is just as important as knowing what to do when you wish to protect your assets in the divorce. Making sure you understand the law and the actions you can take to ensure a fair division of property is critical.