He’s taking money out of our IRA! What should I do?
All sorts of different things spur women to take action in their divorce cases. One of the more common things I hear is that a husband has taken a withdrawal from an investment account, usually without wife’s knowledge. Usually, these women come in, panicked, thinking that because of their husband’s sneaky behavior that there’ll be less to distribute in the divorce.
In some situations, that can be the case. It is possible that he has wasted enough of the assets, over a long enough period of time, that there can be literally nothing left to divide. We’ve had cases like that. Like my mom always says, “you can’t get blood from a rock” so, if it’s all gone, it’s all gone. So, for that reason, it’s important to get in and have a consultation with an attorney as soon as possible.
Most of the time, though, we can get it back—or at least, we can get your share of it. Whether it comes from that particular account or whether we take it from somewhere else (like giving you a greater share of the equity in the marital home) it’s often possible to offset another person’s bad decisions with another asset.
If I know or suspect that he’s taking money out of our accounts, what should I do?
Your first step should be to come in to an attorney as soon as possible. I don’t want to alarm you, and I don’t necessarily think that it’s the end of the world, but I do think that you’re going to want to start taking steps to protect your assets as soon as possible. The longer you let this behavior go on, the worse it could be for you legally.
By getting in to an attorney quickly, you can get into court faster, too. You can schedule a pendente lite hearing (that’s Latin for “while the litigation is pending, and you can just call it a PL, because that’s easier) and, at that hearing, you can ask that the judge issue a restraining order preventing him from wasting any more of the marital assets while your divorce is still pending. That is probably the best step you could take towards stopping this from happening and protecting the assets that you still have left. If he’s done it once, he might do it again—and you definitely don’t want it to be a repeated behavior!
How can I get more information about our financial affairs? I’m afraid that what I don’t know is going to hurt me.
If the accounts are in his name, he can probably do sneaky things without your signature. That doesn’t mean, though, that it’s not a marital asset and that you don’t have a property interest in it in the divorce.
Probably the best thing that you can do, if you don’t have ready access to this information yourself, is conduct formal discovery. That’s usually the second step after the pendente lite hearing, so you’re going to want to jump on it sooner rather than later. Since you’ve filed for divorce, you can request this information—and, if he doesn’t provide it, you can use the resources of the court to help you force him to provide the information. You can ask for all sorts of things—the tax returns, investment account statements, life insurance statements, mortgage statements, credit card bills, and so on—so that you (and your attorney) can begin to pull together the puzzle pieces and make sense of your assets and liabilities.
If you haven’t been the family’s bookkeeper (and there’s usually only 1 in a family, so this happens in roughly 50% of cases), you probably don’t know offhand exactly what’s where. That’s fine. Don’t panic. It’s totally normal, and you’re not to blame because you don’t know. That’s why discovery exists, and we can use it to help us figure out what’s what and begin to plan for how it might be divided.
What do I have a right to receive in Virginia divorce? He keeps telling me that everything is his.
In Virginia, there are three types of property. There’s separate, marital, and hybrid property. Let’s discuss.
Separate property is anything that you earned, purchased or acquired prior to marriage, or anything that you were given or inherited during the marriage by someone other than your husband. Anything that you had (or that he had) before is separate, and is not subject to division in the divorce.
Marital property is anything that you earned, purchased, or acquired during the marriage, regardless of title. It doesn’t matter whether the house has only his name on it, or whether he has a retirement account through his work in his sole name. If it was earned during the marriage, it is marital property, and it is subject to division in the divorce.
Hybrid property is part marital and part separate, meaning that it’s at least partially subject to division in the divorce. We often see real estate and retirement accounts as hybrid assets, because it often happens that one party contributed to the account or asset prior to the marriage. Let’s use a retirement account as an example. If he had a 401(k) prior to marriage with a balance of $100,000, that $100,000 (and any appreciated value related to that initial separate amount) is separate. When he continued to invest in the 401(k) during the marriage, it became a hybrid asset. You have a right to receive a portion of the marital contributions (and any appreciated value related to your marital contributions) in the divorce.
How can I get back my portion of what he took?
It depends on what he took and what other assets you have. If he took $10,000 out of a $50,000 retirement account that was entirely marital, you’d normally see a roughly 50/50 division of $25,000 to each party. If he took the $10,000, we can reduce his share by $5,000 (his half of the $10,000 that he took), and increase your share by $5,000—so that you take $30,000 of the account, and he takes $20,000. In that way, he’d make up to you the value of what he already took.
If he took $10,000 of a $10,000 account, we’d have to look for a way for him to reimburse you differently. You may want to get your $5,000 interest back out of the share of the marital home, or somewhere else. There’s a lot of flexibility here and, provided that there are more assets, we should be able to get your marital portion back.
Don’t panic. But if you suspect that your husband is taking withdrawals on marital assets, you’ll want to act fast—before he has a chance to do any more damage. Give our office a call at (757) 425-5200 to schedule a confidential consultation with one of our divorce attorneys to talk about your options today.