Protecting Your Assets During a Divorce in Maryland

Going through a divorce can trigger a flood of emotions, with financial worries often being a significant source of stress. The impact of divorce on finances can be substantial, particularly if it is not handled correctly. Nevertheless, by crafting a clear and detailed financial plan and taking certain actions, you can protect your assets and strive for a secure financial future.

Understand How Marital Property is Divided in Maryland

In Maryland, the law mandates that courts divide marital property according to the principle of “equitable distribution.” This approach does not automatically result in a straightforward 50-50 split of assets. Instead, the division is based on what is considered fair, taking into account the unique circumstances surrounding each case. While an equal division of assets is possible, the final outcome will depend on various specific factors relevant to the situation at hand, including: 

• Monetary and non-monetary contributions include income and savings, and non-financial contributions include homemaking, child-rearing, and support given throughout the marriage
• Value of property owned by each spouse
• Economic circumstances of both parties
• Age of both parties
• Duration of the marriage

Know the Differences Between Marital and Non-Marital Property

In Maryland, property acquired during a marriage is classified as marital property. This means that if the couple decides to divorce, such property will be subject to equitable distribution. In comparison, any assets a party owned before marriage may be categorized as separate property. This includes any assets received as gifts or inherited from a relative. These separate properties are not subject to division during a divorce, and the original owner retains full rights to them. 

Keep Detailed Records of Your Property

To identify the assets a party owned before their marriage and determine what qualifies as separate property, it is critical to keep thorough financial records. This includes a range of documents such as receipts proving ownership of items, bank statements showing account balances, property deeds verifying real estate ownership, and other pertinent financial papers. By gathering and maintaining this documentation, individuals can bolster their case for asserting separate property claims, ensuring their assets are acknowledged and protected during the divorce process.

Avoid Rushed Financial Decisions During the Divorce Process

While it may seem wise to transfer property or drain a bank account just before filing for divorce, these actions can have detrimental effects. Courts typically look down on such actions, which could even be classified as “dissipation” of marital assets depending on what is done with the property. ”Dissipation” can include any activities involving the misuse, gifting, wasting, transferring, mismanagement, or conversion of marital property for a nonmarital purpose. In addition, behaviors such as gambling, excessive drinking, drug use, or extravagant spending can influence the court’s judgment on the fair distribution of assets. 

Other actions that can complicate settlement include:

• Stopping payments for family financial obligations, including rent, mortgage, and utility bills.
• Gifting valuable items, such as jewelry or electronics, to friends and family if you anticipate filing for divorce. This can be viewed as an attempt to hide assets, which may complicate legal proceedings and affect asset division.
• Deliberately incurring debt on family accounts, believing you and your spouse will split the debts during divorce settlements. Accumulating debt with this strategy can lead to serious financial repercussions and complicate the settlement process. 

To Learn How You Can Protect Your Assets During a Divorce in Maryland, Contact Rice Law Today

Divorce is a complex process that encompasses numerous emotional and legal factors. However, you do not have to navigate this process alone. If you are considering filing for divorce in Maryland and want to know more about the process and how to protect your assets, contact Rice Law today and speak with our experienced Maryland divorce attorneys.