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Naiveté about marital assets can hurt you in divorce

Last May, we offered up a post that asked the question, "How well do you know your marital property?" It can be easy to think that over years of a marriage that you fully understand all the financial ins and outs of your spouse's and your accounts. But what all too often happens in divorce is that it turns out things are much murkier than had been imagined. If business properties and stock options or other less-tangible assets are factors in a marriage, spouses who have less direct control over those assets can sometimes find themselves at a disadvantage at settlement time.

Texas is a community property state. What that means is that property accrued by a couple during a marriage is deemed to be equally shared. And should the couple divorce, those assets need proper characterization and valuation so that a fair and equitable division can be made. The more complicated a couple's assets, the more confusing it can be to achieve a reasonable decree.

In our post in May, we suggested that there are some common steps divorcing spouses might take to fully understand the scope of their marital assets. These include collecting and securing copies of any statements related to banking, investments and taxes. Also on the list might be enlisting the services of a forensic accountant to be sure assets aren't being hidden.

Many might think such steps to be something that any intelligent person would take. But such is not the case. One need look no further than the case of Jamie McCourt to see what we mean.

McCourt is the ex-spouse of former Los Angeles Dodgers baseball owner, Frank McCourt. Unintelligent she is not. She's college educated, has a law degree and a masters of business administration from MIT.

When they divorced a few years ago, she accepted $131 million in settlement. Later, when her ex-husband sold the Dodgers for more than $2 billion dollars, she sought a property division modification, but her request was denied.

In a recent speech, McCourt acknowledged that she had been ignorant and naïve about her own financial situation, and it wound up costing her dearly. She says she hopes others can learn from her mistake.

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