3 ways to protect finances in the early stages of divorce

On Behalf of | Jan 15, 2025 | Divorce

Divorce is a disruptive process. People’s living circumstances and resources shift abruptly during divorce. Financial upheaval is common during divorce proceedings. Between the negotiations to divide property and the need to cover divorce expenses, divorce can very easily have lasting economic repercussions.

People often have to approach the divorce process carefully to protect themselves and their resources. There are a few tactics that can be particularly useful when preparing for an upcoming divorce.

Ask the courts for support

Those filing for divorce can ask the courts to protect them from the possibility of financial misconduct. People frequently worry about the possibility of a spouse emptying out joint accounts or maxing out shared lines of credit. An Automatic Temporary Restraining Order is a temporary court order that can prevent the inappropriate use of financial resources in the early stages of divorce. Such orders can be crucial for those who worry about their spouses misusing assets or accruing unreasonable amounts of debt.

Obtain records before filing if possible

Those who want to avoid financial misconduct by a spouse or to demand accountability for financial misrepresentation need an accurate understanding of their economic circumstances. People can more effectively protect themselves and their assets when they have conducted a thorough financial review and gathered copies of crucial documents. Bank statements, income tax returns and other financial records can establish a history of financial conduct during the marriage. They can help prove that a spouse misrepresented their holdings or altered documents provided during the discovery process.

Consider a credit freeze

While the courts can limit the use of existing financial accounts, spouses might open new accounts in the midst of the divorce. In some cases, a former spouse might try to open a joint account or use the other spouse’s personal identifying information when applying for a line of credit. Those preparing for divorce can often protect themselves from fraudulent misuse of their information by implementing a temporary credit freeze. People can flag their credit reports so that they aren’t at risk of new lines of credit popping up in the midst of a divorce.

Particularly in scenarios where people anticipate financial misconduct on the part of their spouse, being proactive about financial protection can make a major difference. Gathering records and making use of legal protections can help people protect themselves financially during a divorce.

Family Law

Divorce

Asset and Debt Division