Should I Wait To Make New Investments While My Divorce Is In Progress?

On Behalf of | Jul 9, 2024 | Divorce

When you’re going through a divorce, the last thing you expected was a great investment opportunity to land in your lap – but it has. 

Should you let it pass you by since you’re in the middle of your breakup? There’s no simple yes-or-no answer to this question, because what’s right for you might not be right for another person. There are a lot of factors that have to be considered:

Golden opportunities do not come along every day

If you’re already investing, then you know that timing really is everything. Market conditions, promising opportunities and your personal financial goals only align at certain times — so passing up on a lucrative opportunity today could mean missing out permanently. 

That can be particularly frustrating when you’re already reaching to rebuild your financial security post-divorce. Investments can be a key strategy for diversifying your financial portfolio and expanding can be very appealing when you’ve identified a high-reward, low-risk opportunity that aligns well with your goals.

There are potential legal complications that must be managed

The big problem that comes with investing while your divorce is in progress is that divorce proceedings involve a lot of financial scrutiny. Any significant expenditures you make for a large investment – especially one that is bigger than normal for you – can lead to questions about assets concealment or waste of the marital funds. That can prolong your divorce can add to any stress you’re already feeling.

In addition, New York law follows an equitable distribution model. All your assets and income acquired during the marriage can be considered marital property, subject to division. This could affect the final settlement regarding how assets are distributed between you and your spouse. 

Plus, any income from that new investment will likely need to be factored into any spousal or child support calculations – and that may nullify any advantage you see to the investment in the first place. 

What’s the bottom line on investments during divorce? 

You do not want to pass up an investment that you know will be lucrative just because your marriage is ending, but you do need to put the brakes on it until you have a chance to carefully assess the pros and cons of the situation. Understanding the way that investments (and the income they generate) will be divided in a divorce is always easier with experienced legal guidance. 

It’s also important to remember that financial transparency is crucial during a divorce. You cannot make investments without fully disclosing them during the proceedings. Otherwise, you risk losing credibility in the eyes of the court and experiencing unfavorable outcomes.

At The Law Firm of Poppe & Associates, PLLC, our focus is relentless advocacy for our clients. If you or someone you know is considering divorce, reach out to schedule a consultation at 646-665-3903 or by contacting us online.

Let Me Be Your Brave

Mia Poppe, Esq.

Mia Poppe, Esq.
Managing Partner