Virtually all Virginia spouses are aware that dividing marital wealth is one of the most important aspects of any divorce. Some spouses, however, overlook the fact that debt is also a part of the property division process, and that financial obligations are also subject to division between the parties. Taking early steps to prevent additional debt is an important consideration, and spouses should be proactive in addressing the matter.
It is impossible to predict how one’s spouse will react to the reality that the marriage is coming to an end. Some partners will be sad, but will understand that divorce is the best option and will be willing to work together to create a fair settlement. Others, however, will take a far more aggressive approach, and can even take action to cause financial distress to the initiating party. This often comes in the form of racking up debt before the divorce is made final.
The best way to protect against such an outcome is to close as many shared accounts as possible. This will require that those accounts be paid off, which is not always an option. Another approach might be to open a new, low-interest credit card and roll all of the other balances into that account, taking the new card close to the available credit limit. In cases where one’s spouse is only listed as an authorized user, it may be possible to contact one’s creditors and ask that he or she be removed from the account.
Limiting access to available credit is a preventative step that is a wise financial choice in the early stages of a Virginia divorce. It is true that there is a possibility of addressing financial misdeeds in court, but doing so will increase the cost of legal fees, and it is a stressful process. In this property division example, as in so many other divorce matters, an ounce of prevention really is worth a pound of cure.
Source: cnbc.com, “Breaking up is hard to do: Protecting assets in divorce“, Kelli B. Grant, Jan. 17, 2016