Many people find the idea of divorce quite intimidating. They spend months trying to talk themselves out of filing or discussing their concerns with friends, coworkers or family members before finally making a big change.
Not knowing what to expect in Texas divorce proceedings is one reason why people frequently put off making the decision to file. Concerns about the negative financial impact of divorce are another reason.
Those preparing for divorce frequently make mistakes, often after getting advice from people they trust, that will have significant financial repercussions later in the divorce. One of the most common mistakes frequently stems from a desire to prepare for divorce.
Hiding a bank account can come back to haunt you
Especially when the person contemplating divorce is a lower-earning or dependent spouse, people frequently advise someone considering divorce to open a new checking or savings account only in their name. The idea is to have a cash reserve that the other spouse cannot access so that establishing an independent household is easier.
Unfortunately, what people often fail to realize is that the money used to set someone up in the early stages of a divorce is probably marital income and is therefore marital property. You can, in theory, create a bank account solely in your name and use those funds to support yourself early in the divorce.
However, you will have to report that bank account to your spouse and the courts during the discovery process. Those funds represent marital assets that both of you have a right to share in the divorce. Even if you use everything you deposited in that account, you will still have to report it for property division purposes.
What if you don’t disclose your secret savings account?
When people try to hide property from their spouse or the Texas family courts, they can end up suffering serious consequences should they get caught. Whether your spouse discovers a pattern of withdrawals from your shared bank account or brings in a forensic accountant to review your finances before court, you could end up accused of hiding assets.
The judge presiding over your divorce may penalize you and award more property to your spouse because you misrepresented your assets when disclosing them as required in the divorce process. Simple financial mistakes made because you got advice from the wrong people could end up hurting your case in family court. Learning more about the Texas property division rules will help those concerned about financial stability during and after a Texas divorce.
