In the best situations, divorce can still create significant emotional and financial turmoil. In the worst, a divorce can be downright traumatic.
One of the worst situations that can appear in a divorce is a practice called “wasteful dissipation.” This term refers to a spouse intentionally, unnecessarily squandering marital assets. Understanding how to protect yourself against this act can help safeguard your financial future.
Understanding Wasteful Dissipation
Wasteful dissipation occurs when one spouse intentionally wastes marital assets. Generally, the act is considered malicious. It is an attempt to make sure the other spouse receives less property in the divorce.
In most cases, spouses share ownership of any property acquired during the marriage. Therefore, wasteful dissipation is not the same as buying extravagant objects. If a spouse spends all the money on new cars and boats, the other spouse co-owns that property, and that property can be divided in a divorce. Therefore, wasteful dissipation is the act of spending money that cannot be recovered.
Examples of wasteful dissipation include:
- Vacations
- Gambling
- Extravagant gifts to people outside the marriage
- Giving large sums of money to someone outside the marriage (In extreme cases, the wasteful spouse can conspire with someone else to recover this money later.)
Tips for Spotting Wasteful Dissipation
Keep Comprehensive Records
Maintain detailed records of your finances. Document all income, assets, and expenditures leading up to the divorce. This information acts as your safety net. It helps identify any sudden changes in spending or unusual withdrawals. Clear data helps you present a solid case for a wasteful dissipation claim.
Monitor Financial Transactions
Start closely monitoring all financial transactions. Examine bank statements, credit card bills, and other financial documents. Look for any discrepancies or unusual spending, especially during the period when the marriage was falling apart. If you notice unusual activity, investigate further. Document concerns, especially if you suspect wasteful dissipation may be occurring.
Document Shared Expenses
Keep detailed records of shared expenses. Identify how much each spouse contributes to regular costs like housing, utilities, and insurance. Documenting these expenses accurately provides a clearer understanding of financial contributions. This information can support your case if asset division comes into question later.
Work with Financial Experts
Consider hiring financial experts for assistance. Certified divorce financial analysts can evaluate marital assets and provide insights. They can identify potential dissipation and help you develop a strategy. These professionals also offer guidance on managing your finances throughout divorce proceedings.
Consulting with an Attorney
An experienced divorce attorney plays a vital role in protecting your financial interests. Choose someone familiar with cases involving wasteful dissipation. They can help you navigate legal avenues to address concerns. Your attorney can also recommend measures to secure your assets and confirm fair division during the divorce.
Safeguarding Your Assets
Take steps to safeguard your assets before and during the divorce. If you suspect potential wasteful dissipation, secure your financial accounts. You may consider separating certain funds into a personal account. This action minimizes risk and maintains access to essential resources during the divorce process.
Being Proactive
Mediation can address potential conflicts around finances. This process offers a controlled environment to discuss asset distribution openly. Both parties can present their needs and concerns without contention. In the best cases, mediation can help couples find common ground early in the process, reducing stress and improving financial outcomes.
The Potential Effects of Proving a Wasteful Dissipation Claim
Successfully proving a claim of wasteful dissipation can significantly impact the outcome of your divorce proceedings. It often results in a recalibration of asset division, meaning the affected spouse may receive a larger share of the marital property. Courts typically view wasteful dissipation unfavorably, and they may penalize the dissipating spouse. Often, courts decrease the spouse’s entitlement to specific assets or compensate the victimized spouse accordingly.
If you suspect your spouse of intentionally wasting assets in your divorce, contact Cynthia Tracy, Attorney at Law, P.C. right away. We can help investigate your claim and defend you against this harmful act. To meet with our team, contact us online or call us at (281) 612-5443.
