When it comes to high-asset divorces, marital waste dissipation is particularly concerning due to the significant wealth at stake.
Understanding how this problem can arise and the avenues for seeking compensation remains even more critical in such cases.
1. How is marital waste dissipation defined?
Oftentimes, high-asset divorces involve gray divorce. According to research published in the National Library of Medicine, people 50 and over account for 36% of divorces. Those years together mean potentially decades of building assets. Marital waste dissipation occurs when one spouse recklessly squanders marital assets. For high-net-worth couples, this dissipation can lead to substantial financial disparities and severely impact the financial well-being of both spouses.
2. What might dissipation look like?
The methods of marital waste dissipation often have intricacies due to the larger sums of money involved. One spouse might make lavish purchases that serve no real purpose or secretly divert funds into personal investments. Other ways to obscure assets include hidden offshore accounts or complex financial arrangements. In these situations, the innocent spouse might have limited awareness of these actions, making it all the more challenging to detect and prevent dissipation.
3. How can a spouse avoid it or get compensation?
During the divorce, staying actively involved in financial decisions and regularly reviewing accounts and investments helps ensure waste does not happen. As an equitable distribution state, any hidden or wasted assets mean one spouse does not get a fair share. During divorce proceedings, the court will consider the extent of the dissipation and may adjust the division of property accordingly.
For the courts to take marital waste into account, they must have proof. That makes having open communication, financial transparency and proper documentation even more essential.