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Assets and Liabilities

Hiding assets in divorce

Hiding assets in divorce

 

Dishonesty in divorce?

 

Divorce sometimes brings out the worst in people and on occasion this involves one spouse hiding assets. More and more, clients are telling me that they are suspicious that this has occurred in their own divorce and ask what they can do to uncover the truth.

I must point out that quite often the hunch that your Ex was motivated to hide money stems from comments from family or friends and in these cases is quite often unfounded. Do not let your emotions get the best of you! Nevertheless, when you have legitimate reason or proof to believe that your spouse has hidden assets, you and your lawyer must consider how this would actually occur.

There are really two different considerations when reviewing this possible scenario:

Hiding money personally (i.e. through other personal assets)– this is often easier for a lay person or professional to at least attempt to trace (I have done this to some extent on a few occasions).

Through a spouse’s business interest – this may involve but is not limited to: inter–family dealings, sudden appearance of out–of–the–ordinary expenses or salaries, new or hidden bank accounts, delaying or retaining income, unreported transactions, large one-time purchases written off, sudden declines in business performance.

Unfortunately, in the latter instance or in years of planning and personally hiding money, the services of a forensic accountant are most often required to uncover the truth. Most lawyers would caution the process is extremely expensive and very lengthy and should only be undertaken in cases where there is a reasonable degree of certainty that very, very significant sums of money have been hidden.

Remember that no one can force your spouse to be honest and forthcoming. Lying is always possible in the absence of integrity.

By | July 27th, 2012|Assets and Liabilities|0 Comments

Divorce during recession

Divorce during recession, a double-edged sword

 

Can you go through with the decision to divorce even during a recession? Is the distant memory of ‘for richer or poorer’ ringing more true for you and your partner today? What effect will these poor economic times have on your decision? Should you decide with your ‘head’ or your ‘heart’; it’s a double-edged sword.

As if it’s not unpleasant enough to have problems in your marriage, today many couples are feeling trapped as the economy very slowly recovers.

The decision to divorce may have to be a ‘NO’ for you, at least for the time being, if financial stability has taken Divorce in Recessiona front seat. For men especially, money tends to be at the root of many decisions and the question of divorce is no different. Couples are staying together, living under the same roof, because their family income has been cut in half or in some cases eliminated altogether. It takes special people at the most difficult time in your lives to continue to co-exist under these circumstances.

With housing prices slow to recover, a couples’ equity in their home has often significantly decreased. Often, families are forced to stay together in the same home even after the divorce decision has been made; waiting months, sometimes more than a year, for their house to sell. What kind of environment are we subjecting our children and family to, continuing to live with a partner that we no longer want to be with, solely for the money?

Properties, including investment and retirement portfolios have decreased, in some cases more than 30%. Should you stay together hoping to upgrade the pie that you will split? Is that realistic? Does anyone know how long that will take or when that will actually be?

Now, if we place emotional security above financial stability, the decision to proceed with divorce is often a resounding ‘YES’. Women tend to make decisions of the heart and are the ones more often taking jobs or even second jobs they perhaps otherwise would not have, and dads are sometimes staying home with the kids.

If one of you does move out, there may still be mortgage payments, and now there may be rent for the partner who has left. If you can’t sell the house, then one of you retaining it at a lesser valuation may, over time and as prices rise, be a smart financial decision; will keeping the house instead of other assets, in the long run have been the better financial decision?

If portfolios are divided during a recession, then one partner may end up with the share of the pie that rebounds more slowly; if you are the fortunate one, much more quickly. Are you willing to take the financial risk for your emotional health?

Money matters during a recession are often the overriding theme in a marriage. During turbulent times in a relationship, the decision to end a marriage is a double-edged sword. Will we sacrifice our emotional well being if we stay? But then again, can we afford not to?

Property in DiovrceThe decision to divorce may have to be a “NO” for you, at least for the time being, if financial stability has taken a front seat. For men especially, money tends to be at the root of many decisions and the question of divorce is no different. Couples are staying together, living under the same roof, because their family income has been cut in half or in some cases eliminated altogether. It takes special people at the most difficult time in your lives to continue to co-exist under these circumstances.

With housing prices slow to recover, a couples’ equity in their home has often significantly decreased. Often, families are forced to stay together in the same home even after the divorce decision has been made; waiting months, sometimes more than a year, for their house to sell. What kind of environment are we subjecting our children and family to, continuing to live with a partner that we no longer want to be with, solely for the money?

Properties, including investment and retirement portfolios have decreased, in some cases more than 30%. Should you stay together hoping to upgrade the pie that you will split? Is that realistic? Does anyone know how long that will take or when that will actually be?

Now if we place emotional security above financial stability, the decision to proceed with divorce is often a resounding “YES”. Women tend to make decisions of the heart and are the ones more often taking jobs or even second jobs they perhaps otherwise would not have, and dads are sometimes staying home with the kids.

If one of you does move out, there may still be mortgage payments, and now there may be rent for the partner who has left. If you can’t sell the house, then one of you retaining it at a lesser valuation may, over time and as prices rise, be a smart financial decision; will keeping the house instead of other assets, in the long run have been the better financial decision?RRSP

If portfolios are divided during a recession, then one partner may end up with the share of the pie that rebounds more slowly; if you are the fortunate one, much more quickly. Are you willing to take the financial risk for your emotional health?

 

Money matters during a recession are often the overriding theme in a marriage. During turbulent times in a relationship, the decision to end a marriage is a double-edged sword. Will we sacrifice our emotional well being if we stay? But then again, can we afford not to?

By | May 31st, 2012|Assets and Liabilities|0 Comments

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