How do I protect my assets during a divorce?
One of the things is, before your spouse knows that you’re contemplating divorce (and I’m assuming that you’re the one who’s contemplating it), I’ll advise clients to go through and get snapshots of the finances. Go get the most recent statements. Go through the file cabinet. If you have access online to the bank accounts, print out what’s there so you have the ability to reconstruct what was there.
Once you file for divorce, something called “the preliminary injunction” goes into effect. That’s the first court order. It happens as soon as the divorce is initiated. It prevents either party to the divorce from transferring any assets outside of the marriage, from spending money beyond the necessary items, and encumbering assets. The problem with it is it’s just a court order. It just means they’re in trouble if they do it; it doesn’t prevent them from actually doing it. It’s not magic.
The other problem with that is a lot of times divorces are easier to settle before the divorce is filed. When I meet with a client, I try to get the feeling of whether they’re afraid and really have a legitimate concern about their spouse moving assets, transferring them to their siblings, spending up credit cards — all of that. If they don’t have a real concern or if the assets are already protected in a way that they don’t need to worry, then I always try to see whether the case can be settled before the divorce is filed and before the preliminary injunction goes into effect. Once you file for divorce, a lot of people see that as a shot across the bow, game on. In my experience, it’s easier to keep the cooperative let’s try to get this done together in the best possible, least expensive way; it’s easier to do that before the divorce is filed.