Most marriages involve division of labor. One spouse may be in charge of grocery shopping and cooking while the other spouse handles homework, soccer practice, or other child-related matters. One spouse may handle lawn maintenance and home repair as the other focuses on laundry and indoor chores. While dividing responsibilities is common in a marriage, there is one way in which this division of labor can put a spouse in a very vulnerable position during a divorce. If you have not been involved in household financial decisions, it is important to start learning about your finances as soon as possible.

Being Ignorant of Your Financial Situation Can Lead to an Unfair Divorce Settlement

In an interview recently published in the Wall Street Journal Magazine, Kris Jenner admitted that she was embarrassingly uninformed about her own finances during her marriage to Robert Kardashian, Sr. She explains that she did not know how much she and her husband spent on household expenses and never once paid a bill. Jenner’s story is not uncommon. Many spouses leave the financial management to the other spouse. Unfortunately, ignorance is not bliss when it comes to finances and divorce, and if you do not fully understand your financial situation, this can put you at a disadvantage when negotiating a divorce settlement.

Start Gathering Financial Documents Now

If you are planning to get a divorce, it is important to know where you and your spouse stand financially. Property that is acquired by either spouse during a marriage is typically considered marital property. Both spouses have a right to an equitable share of marital property. Debts acquired by either spouse during the marriage are also jointly held by the spouses. 

Divorce can make some people act in irrational or even malicious ways. One example of this is when a spouse purposely destroys the other spouse’s property. A resentful spouse may set fire to the other’s belongings, throw out important documents, or sell valuables for cash. If your spouse has destroyed your property or wasted assets during or immediately prior to your divorce, it is important to take steps to protect yourself and your property. It is also important to educate yourself about your legal options moving forward. You may be able to recoup the value of the destroyed property through a dissipation claim.

Get a Financial Restraining Order to Protect Your Assets During Divorce

If your spouse is intent on seeking vengeance through selling your property, destroying your assets, or emptying joint bank accounts, you need to take immediate action to protect your finances. One option is to request a temporary financial restraining order. This is a court order that prevents both you and your spouse from making unusual financial transactions or significant purchases. A financial restraining order freezes joint accounts and protects marital assets. The order also prevents the spouses from spending, transferring, selling, or hiding funds or property.

A Dissipation Claim May Allow You to Recover the Value of Wasted Assets

If your spouse has already misused, wasted, or destroyed assets, you may still be able to reclaim the value of these assets. Per Illinois law, “dissipation of assets” occurs when a spouse wastes assets during the end of the marriage. More specifically, dissipation involves using assets in a way that only benefits one spouse while the marriage is experiencing an “irretrievable breakdown.” Case law has established that dissipation may involve wasting marital or non-marital assets. A marriage is considered to be in an irretrievable breakdown when the end of the marriage is inevitable, and the spouses have stopped trying to salvage the marriage. Through a successful dissipation claim, you may be awarded a proportionally greater share of the marital estate to compensate you for the wasted or destroyed assets.

When a married couple divorces, the spouses divide their property and debt. When most people think about asset division during divorce, they think about dividing physical property such as furniture or vehicles. However, a business is an asset just like any other piece of property. If your business was purchased or established during your marriage, both spouses have a right to the business according to Illinois law. If you are a business owner who is considering divorce, it is crucial that you understand how businesses may be valued and divided in an Illinois divorce.

Does My Spouse Have a Right to My Business?

If you are solely responsible for managing your business, you may assume that you are entitled to keep the business upon divorce. However, this is not always the case. Illinois law considers any property acquired during the marriage to be part of the marital estate. Property that was acquired before the marriage is classified as “separate property” and assigned to the spouse who originally acquired the asset. However, even if you founded or acquired a business before you got married, an increase in the value of the business during your marriage may be considered marital property. This is especially true if your spouse contributed to the increased value of the business, and in these cases, you may be required to reimburse your spouse for their contributions.

The Business Must Be Valued Before it Can Be Divided

Having your business accurately valued is a crucial step when you are getting divorced. The most commonly used business valuation methods include an asset approach, earnings value approach, and a market value approach. An accountant or business valuation expert can work with you and your attorney to help you determine the best way to value your business. Once you have determined how much your business is worth, you must decide how to account for the business’s value during asset division. You may choose to “buy out” your spouse’s share of the business by assigning him or her marital assets of an equivalent value. You may also decide to sell the business and divide the proceeds between you and your spouse.  Your attorney can help you and your spouse negotiate a property division arrangement that takes the value of your business into account.

While we often think of marriage as a personal or romantic union, it is also a financial partnership. When two people get married, they combine their financial resources, either intentionally or unintentionally. Therefore, the end of the marriage comes with considerable financial implications. If you are planning to get divorced, you may have questions about how your property will be divided. You may specifically wonder if the spouse who earned the majority of the income during the marriage is entitled to more of the marital estate during divorce.

What Property Is Divided in an Illinois Divorce?

When you file for divorce in Illinois, there are several issues that you will need to resolve. One of these issues is the distribution of marital property. The marital estate consists of property that either spouse accumulated during the course of the marriage. It includes real estate, personal property, collectibles, investments, retirement accounts, and other assets that were obtained while the couple was married. Separate property includes property gained by inheritance or property that a spouse acquired before the marriage took place or after a legal separation. However, understanding what is included in the marital estate and what is separate property is not always easy. Issues like commingled or combined assets can complicate property division during divorce.

Reaching a Property Division Settlement

There is a misconception that the courts always divide property in a divorce. In reality, the vast majority of divorce cases are resolved through a settlement or mutual agreement. You and your spouse may decide how to divide your assets on your own, with help from your attorneys, during divorce mediation, or through another avenue. If you cannot reach an agreement, then the court will step in and divide marital property for you. Illinois courts follow a legal doctrine called equitable distribution in contested divorce cases. Property is divided equitably but not always evenly, and this division is based on factors such as:

Did you know that the average amount of personal debt for Americans aged 40-55 is over $135,000? Whether through a home mortgage, personal loans, credit cards, or student loans, most people have at least some debts. If you are planning to get a divorce, you may be wondering how debt will be handled. Typically, marital debt is handled similarly to marital property during an Illinois divorce, but each case is different.  

Illinois Laws Regarding Marital Debt

In many marriages, one spouse is more of a spendthrift than the other. Often, differences in spending habits and financial goals are one of the issues that lead to divorce. If your spouse has accumulated a considerable amount of debt, you may wonder if you will be expected to repay it after divorce. You may also wonder if your spouse will be on the hook for debts that you have acquired.

Illinois courts divide marital property according to a legal doctrine called equitable distribution. Property and debts are divided fairly but not always evenly. Marital property and debts, meaning property and debts obtained during the marriage, are divided between spouses. Non-marital property, which includes assets and debts acquired by a spouse before getting married, is assigned to the spouse who originally acquired it. However, in the majority of cases, the court does not decide the allocation of marital property and debts during divorce. The divorcing couple instead reaches an out-of-court settlement regarding property and debts through negotiation, mediation, or another dispute resolution method.