Protecting Your Assets During Divorce

Divorce is emotionally complicated, but it can also devastate a person’s finances. When one spouse files for divorce, the other might be tempted to clean out joint bank accounts or run up bills on a joint credit card. Suddenly, you can find yourself thousands of dollars into debt—and with no easy way to get out from under it.

At Surasky Law Firm, our Aiken, SC divorce lawyer is committed to helping family law clients get a fresh start after divorce. The best thing to do is to protect your finances as soon as you realize you are divorcing. Call our firm. Below, we identify simple steps to take.

Close Joint Credit Cards

You don’t want your spouse to take an all-expenses paid trip to Vegas with their friends after reading the divorce petition. You will likely end up having to foot some of the bill.

In a South Carolina divorce, joint debts are usually divided between the spouses. And regardless of how they are divided, you are on the hook for any debt which has your name on it. If your spouse runs up bills on a joint credit card, then the lender can come after you for repayment. Should you fail to pay, the lender can actually file a lawsuit against you and even force you into collections. Your credit report would end up shredded.

Protect yourself by closing joint credit cards, or idealy removing the spouse from the card instead if possible.

Freeze Your Credit

Your spouse also has access to personal information like your birthdate and your Social Security Number. You don’t want them to take out a loan in your name. It’s illegal to do that, but we’ve heard some stories of this exact thing happening.

Protect yourself by calling the credit bureaus to put a freeze on your credit. A credit freeze provides immediate protection. Most lenders will require your credit history as part of the application process. When they call or go online to look at your report, it will be blocked. This means no one can take out a loan in your name.

Take Half Out of a Joint Checking or Savings Account

You also need to protect against your spouse cleaning out a joint checking or savings account (or both). Once the money is spent, it is gone.

Protect yourself by withdrawing half of any amount in any joint account and opening an account in only your name. That way, your spouse won’t blow it.

Are you entitled to half? Probably. South Carolina is an equitable distribution state. Although there is no automatic 50/50 split, you will probably get close to half. By taking the amount and putting it in a safe account and not spending it until the divorce is finalized, you are protecting yourself. Also, have any work cheques routed to a personal bank account moving forward.

Regularly Check Your Credit Balances

You don’t want your spouse to literally take your credit card and use it or use it for online shopping. That sometimes happens.

Protect yourself by regularly monitoring your balances to make sure no one is using one of your cards without your permission. You should also keep credit information secure, especially if you haven’t yet moved out of the house with your spouse.

Protect Valuable Assets During Divorce

You don’t want your spouse to sell/destroy any valuables. Some steps you can take are:

Negotiate temporary occupancy of a home: If you're concerned about your spouse selling or damaging the home, you may be able to negotiate temporary occupancy arrangements as part of the divorce process.
Negotiate temporary use of vehicles: You may be able to negotiate temporary use of a boat and cars as part of the divorce process. Otherwise, remove any valuable equipment from the boat and cars and store it in a safe place.
Document everything: Keep a record of all communications, agreements, and actions related to your assets. This can be helpful in case of disputes.
Document ownership: If you have documentation proving your ownership of the assets, keep it in a safe place.
Consider a temporary restraining order: If you're concerned about your spouse taking or damaging your assets, you may be able to obtain a temporary restraining order.
Consult with an appraiser: If you have valuable assets, consider having them appraised to determine their fair market value.
Protect yourself by renting a safe deposit box: to store small valuables or move them out of the house and into your new home or apartment.

Protect Retirement Accounts

A 401k and other retirement accounts are also assets you will need to consider in the divorce process. Retirement accounts acquired during the marriage are generally considered marital property and subject to division. A Qualified Domestic Relations Order (QDRO) is necessary to divide a qualified retirement plan.

During a divorce, the court will consider lots of factors when dividing retirement accounts, including the length of the marriage, the contributions of each spouse, and the financial needs of both parties. It may be helpful to obtain an expert valuation of your retirement accounts to assist the court in determining a fair division.

South Carolina follows an equitable distribution approach when dividing marital property, including retirement accounts.

Change Passwords to Financial Accounts

Most people do their banking online. Unfortunately, your spouse might be able to access your accounts, especially if you saved the password on the computer.

Protect yourself by creating all new passwords for accounts and the email attached. We recommend not saving the password to Windows. Instead, write down the password on paper for added protection.

Ask for Temporary Spousal Support

A divorce in South Carolina usually takes more than a year. While you live separately, you should ask for spousal support, which can help tide you over, especially if your spouse makes more than you. This support usually takes the form of monthly payments from your spouse to you, and you can use the money however you want.

Improve Your Financial Prospects After Divorce

To hit the ground running after divorce, you need a financial game plan. Living as a single person can be much more expensive than when you are married. Instead of splitting expenses with another person, you need to cover the entire cost of utilities and rent. There are certain things you can do:

Ask for alimony. This is like spousal support, except you receive it after your divorce is finalized. We can work to request alimony from the judge, or you can negotiate alimony as part of a divorce settlement.
Choose the right assets. You should give some thought as to what marital assets you want to leave with. For example, the home might be too expensive for you as a single person. You must consider upkeep and maintenance, as well as insurance. Instead, you might prefer a low maintenance option, such as a retirement account or even cash.
Seek out any subsidies you can find. You might qualify for rent subsidies, utility subsidies, or other public assistance. People divorcing later in life often have access to programs for senior citizens. Try to maximize all sources of income to defray the cost of setting up a new household.
Plan to receive more education or work experience. Have you not worked outside the home? You should plan on trying to improve your work history, which will help you obtain paid employment to support yourself.

Call Us to Get Started

Divorce is a scary experience for many, but there are sensible steps to take which provide financial security. If you have questions about divorce, contact Surasky Law. Our Aiken, SC divorce lawyer can handle your divorce from filing the petition to the final hearing. Give us a call to schedule an appointment.