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Common Financial Issues in a Divorce

Common Financial Issues in a Divorce

Date: Jul 14, 2022
In: Child Support

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Common Financial Issues in a Divorce

Divorce boils down to a series of challenging financial issues that often become contentious. The fact is that both of you are destined to walk away from your divorce with fewer overall assets than you had while you were married, and the process of hammering out the financial terms can be daunting. One of the most important steps you can take to help ensure that your financial rights are well protected throughout the divorce process is working closely with an experienced California divorce attorney from the outset.

Your Marital Assets

Your marital assets are those properties and other things of value that you, your spouse, or both of you together acquired while you were married. Because California is a community property state, these assets – or their value – must be split between you equally upon divorce. Any assets that either of you owned prior to marriage and that you were able to keep separate during your marriage will remain the property of that spouse, but maintaining an asset’s separate nature over the course of a marriage can prove exceptionally difficult. 

Complicating Financial Factors

There are certain financial factors that tend to make the division of marital assets that much more complicated, including:

  • Business ownership 
  • High assets
  • Asset hiding
  • Intertwined marital and separate assets

Business Ownership

Businesses represent complicated financial entities that can be very challenging to address in terms of property division during a divorce for all of the following reasons:

  • If you are both employed by the business, it is the sole source of income for both of you, and one of you will very likely be giving up your livelihood.
  • It can be very difficult to obtain a business valuation that satisfies both of you.
  • Businesses represent an excellent opportunity to obscure or hide assets (especially if your spouse is more involved in the business than you are).
  • Because it may not be financially feasible to sell the business outright, one of you will likely have to walk away, which can take both a financial and an emotional toll. 

A Note about Separate Assets

Sometimes, separate assets also have a marital component. While a retirement account that you own prior to marriage, for example, is a separate asset, any increase in its value over the course of your marriage is marital and will need to be divided. The same is true of properties that either of you owns separately – the value increase they experience will need to be addressed as marital property. 

Asset Hiding

If your spouse chooses to spend down, give away, gift, or otherwise hide assets, it can be very difficult to detect and can significantly skew the division of your marital assets. Having a savvy divorce attorney with considerable experience ferreting out financial hijinks is in your best interest.  

Discuss Your Financial Concerns with an Experienced California Divorce Attorney

The formidable California divorce lawyers at Miranda, Magden & Miranda, LLP, focus their practice on zealously protecting the financial rights of clients like you. Your case is important, and we are here to help – so please do not wait to contact us for more information about what we can do for you today.

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