How Marital Waste Impacts Your Divorce Settlement

As a family law attorney in Texas, I often see clients either accused of—or victimized by—marital waste. That’s when one spouse intentionally or recklessly squanders the couple’s assets without a valid reason. We’ll get to a more formal definition shortly, but first, let me tell you about what happened one morning when James called me.

“Chris, I can’t believe what she’s bringing into this,” he said. “She’s accusing me of marital waste and claims she can get a better settlement if she proves it.”

“Marital waste is a real issue, James,” I replied. “And so is the burden of proof. She’ll have to substantiate her claim. Do you know what she’s accusing you of?”

“No, that’s the thing—she won’t tell me. It’s part of her game,” he said.

“Well, is there anything I should know? Did you use community property on a girlfriend or an expensive habit?”

“Girlfriend?” James scoffed. “She’s the one already dating. Who knows how long she’s really been with him. And no, I mean—does playing poker with the guys count? Heck, it’s hardly waste. Cheaper than therapy, even when I lose.”

“No, I wouldn’t say poker qualifies, but excessive gambling might. There are many things that could constitute marital waste. Do you know what they are?” I asked.

“No—should I?” he asked.

Marital Waste and Impact on Divorce Settlements

“Now, you definitely should. Let me explain how marital waste could impact your divorce process. Then, we’ll take a closer look at your situation and see where you stand if she actually pursues the accusation,” I told him.

“Thanks, Chris. Let’s do it.”

Marital waste can wreck a couple’s financial stability and chip away at trust. It’s a real issue that often pops up during divorce cases in Texas. The court evaluates various factors, including marital waste, during the equitable distribution of marital property.

Actions taken by a spouse, such as the wasteful use of finances, can significantly influence the outcomes and affect the perceived fairness of asset distribution.

Understanding what counts as marital waste, how it can affect the split of assets, and what to do if you think your spouse is blowing through marital funds is crucial.

This guide covers the basics of marital waste under Texas law. We’ll define the term, share some common examples, and talk about ways to protect yourself.

This info is worth knowing whether you’re in the middle of a divorce with marital waste as an issue or just want to understand your rights when it comes to shared assets.

What Is Marital Waste in Texas?

Marital waste is when one spouse intentionally or carelessly misuses, burns through, or destroys community property—usually without the other’s consent and not for a real family need. In Texas, both spouses earn or acquire anything during the marriage which is community property.

This means both spouses have an equal, undivided interest in those assets. If someone deliberately squanders, hides, or improperly dumps shared resources, the court may call it marital waste, or sometimes “dissipation of assets.”

Spouses must manage community assets with care and responsibility. Wasteful behavior can significantly impact property division in a divorce. It’s not simply about making a bad investment or a mistake with money, especially if done in good faith. The key lies in intent or recklessly disregarding the other spouse’s stake in what both own.

Getting this difference right matters a lot when you’re fighting over who gets what. Courts determine whether marital waste has occurred by analyzing evidence and considering various factors within the context of court proceedings.

Common Examples of Marital Waste

Marital waste shows up in all sorts of ways, sometimes just from bad decisions, but often from deliberate actions that hurt the marital estate. Here are some of the more common examples:

• Compulsive or excessive gambling with community money, leading to big losses.
• Spending a lot on an affair—gifts, trips, or support for a paramour (yep, that’s financial infidelity).
• Engaging in extramarital affairs and using marital assets to finance these relationships as considered financial misconduct.
• Making risky investments without your spouse’s knowledge, especially if it’s reckless.
• Selling valuable stuff (cars, real estate, collectibles) for way less than it’s worth.
• Transferring property to friends, family, or a new romantic partner without fair payment or your spouse’s okay.
• Running up big debt on personal luxuries that have nothing to do with family needs.
• Destroying property out of spite or anger.
• Letting valuable things fall apart because of neglect.
• Blowing community money on hobbies or side projects without being upfront or getting agreement.
• Financing secret addictions to drugs, considered reckless spending.

But not every money fight or financial loss means there’s marital waste. A classic example of marital waste involves actions like spending money on an affair or making risky investments without the spouse’s knowledge. Reasonable spending—even if your spouse disagrees—or investments that flop despite honest effort usually don’t count.

Courts look for actions that purposely or recklessly drain the community estate, especially if it happens close to separation or divorce.

Sometimes martial waste and claims of fraud can merge in divorce cases. Please see this article to find out more: Fraud and Waste Claims in Texas Divorces – 2024

How Marital Waste Impacts Division of Property

In Texas, the divorce law says courts have to split community property in a “just and right” way when you get divorced. That often ends up close to 50/50, but it doesn’t have to be exactly equal. During a pending divorce, actions such as extravagant spending or risky investments can significantly impact the division of assets.

If the court finds marital waste, it can tip the scales and lead to an uneven split. The judge may award a larger share to the spouse who didn’t waste assets to compensate for the loss. When one spouse proves marital waste or infidelity, the judge may grant the wronged spouse a more favorable settlement.

This could mean specific assets or a larger chunk of cash. Sometimes, the court orders the wasteful spouse to pay back the value of what was squandered—this is called a reimbursement claim.

Basically, the court figures out what was wasted and might assign that debt to the wasteful spouse or adjust the division to cover the loss. Another approach is “reconstituting the estate,” where the court pretends the wasted assets are still there and divides things as if the wasteful spouse already got their share.

For example, suppose a wife secretly spends $30,000 of community funds on gifts for a boyfriend, leaving $200,000 remaining. The judge could add the $30,000 back into the total (making it $230,000), split it in half, and award the husband $115,000 from the remaining funds. That would leave the wife with $85,000—her share minus the $30,000 she already spent.

Big-time waste can also affect decisions about spousal support if it shows a pattern of financial recklessness or misconduct.

For more details about reimbursement, please see Reimbursement, Fraud, Waste, and the Reconstituted Estate.

Proving Marital Waste in Texas

If you think your spouse has wasted marital assets, it’s on you to prove it. You’ll need strong evidence showing they intentionally or recklessly misused community funds or property. Being aware of financial issues, such as gambling addiction or sudden financial changes, can significantly influence the court’s determination of marital waste.

This usually means you’ll have to dig through financial records and play detective. The formal discovery process is a big part of divorce cases—through your lawyer, you can request documents, demand financial records, and ask written questions (interrogatories) or get sworn testimony (depositions).

Sometimes, hiring a private investigator can be crucial in uncovering evidence of marital waste. These professionals can help trace financial discrepancies and gather proof of infidelity or other misconduct.

What kind of evidence helps? Here are a few examples:

• Bank statements with big, unexplained withdrawals or weird transfers.
• Credit card bills showing lots of spending on personal stuff, travel, or gifts for someone else.
• Deeds or bills of sale proving assets were sold for way less than they’re worth.
• Records of hidden accounts or investments.
• Evidence of gambling losses—casino records, bank transactions, that sort of thing.
• Witnesses who saw the wasteful behavior or got improper gifts.
• Proof of destroyed property—photos, maybe even police reports.

Proving intent is tricky. The timing—like if spending ramps up right before the split—or attempts to hide transactions can help show motive.

Sometimes, especially with business interests or complicated assets, you’ll need a forensic accountant. These folks are pros at tracing money, spotting weird patterns, and explaining it all to the court.

Steps to Protect Yourself from Marital Waste

If you’re worried your spouse might start burning through marital assets, especially if divorce is on the horizon, it pays to be proactive about monitoring your spouse’s spending habits. You can’t control everything before the court steps in, but you can get more involved and feel prepared.

Here are some steps that might help:

1. Keep tabs on your finances. Check joint accounts, credit cards, and investments regularly. If something looks off, ask questions.
2. Hold onto copies of important financial docs—tax returns, pay stubs, account statements, loan paperwork, property titles. Good records make it easier to spot problems later.
3. Push for financial transparency. Open conversations about money can help, though let’s be real, that’s not always easy if things are tense.
4. If divorce seems likely, talk to a family law attorney ASAP. They can tell you what you’re allowed to do, like carefully separating finances (without breaking any rules or informal deals).
5. Your lawyer might suggest temporary restraining orders (TROs) once the divorce is filed. These can stop either spouse from selling, hiding, or wasting assets while things are pending. Breaking a TRO is serious business.
6. Consider meeting with a financial advisor. Knowing your full financial picture can help you spot risks and plan for your future, with or without your spouse.

Acting early usually works better than trying to get back assets that have already vanished. A good lawyer can tailor advice to your situation.

Legal Remedies for Marital Waste

Finding out about marital waste during or shortly after divorce gives you options to try to set things right. Your attorney can walk you through which remedies fit your case best.

Some of those legal options include:

• Filing a Reimbursement Claim: Asking the court to make the wasteful spouse pay back what they drained from the community estate. Repayment could come from their separate property or their share of what’s left.
• Requesting a Disproportionate Share: Asking the judge to give you a bigger piece of the remaining assets as compensation.
• Seeking Enforcement Actions Post-Divorce: If waste happens after the divorce decree—like ignoring rules about asset handling or support—you can ask the court to enforce the orders. That might mean contempt proceedings if they’re ignoring the judge.
• Pursuing Fraud Claims: If your spouse went out of their way to hide assets or pull off fraudulent transfers, you might have a separate civil fraud claim. It’s more complicated, but sometimes necessary.

How well these work depends a lot on your evidence and the details of your case. A seasoned Texas divorce attorney can help you figure out the strongest route forward.

Marital Waste vs. Separate Property

Knowing the difference between community property, separate property, and personal property is huge when it comes to marital waste claims in Texas. Separate property is usually what a spouse owned before marriage or got as a gift or inheritance during marriage, specifically for them.

Separate property belongs only to that spouse and doesn’t get split in a divorce. If someone spends their own separate property, that’s generally not marital waste, even if the other spouse is upset about it.

The catch? Commingling. If you mix separate property with community property—say, by dumping it all in a joint account—it can get messy. If you can’t trace the funds clearly, separate property might lose its status and be treated as community property, which opens the door to a waste claim.

Also, if community funds are used to pay down debt on or improve separate property, the community might have a reimbursement claim.

The Role of Prenuptial and Postnuptial Agreements

A solid prenuptial agreement (before marriage) or postnuptial agreement (after marriage) can go a long way in preventing fights over marital waste. These agreements let couples spell out their financial rights and responsibilities for fair division.

They can cover things like:

• Defining what’s separate property and what’s community property, even if it’s different from Texas defaults.
• Setting rules for how joint accounts or certain assets should be managed.
• Including requirements for financial transparency and disclosure.
• Outlining what happens if someone dissipates assets or spends beyond agreed limits.
• Deciding how debts racked up during the marriage will be handled.

These agreements can’t decide child support or custody, but they’re a powerful tool for protecting assets and setting expectations. Having the conversation isn’t always easy, but it can save a lot of headaches (and money) down the road if marital waste ever becomes an issue.

Postnuptial agreements can clarify financial arrangements for couples who are already married, ensuring they properly evaluate financial decisions and divide property.

When Marital Waste Becomes Financial Abuse

Sometimes, what looks like marital waste is actually part of a bigger, more troubling pattern called financial abuse. This happens when one partner uses money or control over finances to dominate, intimidate, or isolate the other, including allowing their family members to borrow funds from a partnership to purchase properties.

So, how do you spot when wasteful spending crosses the line into financial abuse? Here are some signs:

• Cutting off your access to bank accounts, credit cards, or cash, making you totally dependent.
• Forcing you to justify every penny you spend, while they spend in secret or without limits.
• Using money to control where you go, what you do, or who you see.
• Hiding income, assets (hidden assets), or financial details from you.
• Pressuring you to take out loans or rack up debt in your name, even if you don’t want to.
• Sabotaging your job or education to keep you under financial control.
• Blowing through marital funds on purpose just to punish or leave you with nothing during separation or divorce.

If any of this sounds familiar, don’t just focus on the money. This is about your safety and well-being. There are people who can help: domestic violence organizations, therapists, family law attorneys who know how to handle high-conflict cases.

They can help you with safety planning, legal protection (maybe even protective orders), and support. Courts do take financial abuse seriously, and it can affect property division and sometimes even child custody.

Alternative Dispute Resolution: Mediation and Collaborative Divorce

Sure, you can try to prove marital waste in court, but that’s not the only way. Mediation and collaborative divorce are two paths that can help you sort things out without a big fight in front of a judge, making the divorce proceedings less contentious. These focus more on talking it out and coming to an agreement.

With mediation, a neutral mediator steps in to help both spouses talk through disagreements, including any claims of waste. You’ll both need to be open about your finances. The mediator doesn’t decide for you—they just help you find common ground. If it works, you walk away with a settlement you both can live with.

Collaborative divorce is a bit different. Each spouse hires a collaborative attorney, and everyone agrees to work together, not against each other. Sometimes, financial experts or mental health professionals join in to help with the tricky stuff—like waste claims or the emotional rollercoaster of splitting up.

The idea is open conversation, financial transparency, and finding creative solutions. Maybe that means reimbursements or dividing things a bit unevenly to make up for waste, but without dragging it all through court.

These approaches can be less hostile and, honestly, might save you money. But they only work if both people are willing to play fair. If someone’s hiding assets or just refuses to admit there’s been waste, you might end up in court anyway.

Frequently Asked Questions

What About the Accusation Against James?

“So, James, what do you think? Did you know there was so much to learn about marital waste?” I asked.

“Nope. Barely ever heard of it before she accused me. I wouldn’t be surprised if her attorney put her up to it—he’s not like you,” James said.

“He’s probably just doing what he thinks is best for his client,” I told him.

“I think they’re playing dirty, trying to scare me. If anything, she’s the wasteful one—always was. Do you know how much junk we have around that house?”

Confusion About Legal Definitions

“That’s not the kind of waste we’re talking about. This is about squandering assets before they get divided. Did she do that?” I asked.

“You know, I don’t know. I never really kept track of the money—what she spent or what I spent. She didn’t like my spending habits. That’s part of why we’re in Splitsville,” he said.

“You already told me you didn’t spend any money on another woman or excessive gambling—how about drugs? Nothing else reckless?” I asked.

“No, sir. I didn’t. I think she just sees every cent I spent as wasteful,” he said.

“Well, maybe that’s it. Maybe she hasn’t grasped the legal meaning of marital waste. She might just be focused on her personal definition. Do you know for sure if she spoke to her attorney about it?” I asked.

“No, I just thought it might be the case. Maybe she didn’t. Maybe she’s just obsessed with how ‘wasteful’ I was—maybe she assumes marital waste is just regular waste, not what it means legally,” he said.

“There’s a good chance that’s the issue. But we still need to be ready to defend the accusation if she does bring a legal argument. Better to be prepared,” I told him.

“I think you’ve figured this out, Chris. Thanks. And I trust you’ll be able to defend me if necessary—I’m in good hands,” he said.

Schedule a Consultation With Our Law Firm to Find Out How Marital Waste Can Impact Your Divorce Settlement In Texas

Trying to figure out martial waste can impact your divorce settlement can be stressful and challenging, but you do not have to face it alone. Our team of experienced Dallas divorce lawyers is ready to provide you with the guidance, support, and legal advocacy you need during these challenging times.

Whether you are wondering about marital waste or navigating other child custody related issues, we are here to help you every step of the way. We welcome you to schedule a consultation to discuss your situation and case objectives. We can answer your legal questions and discuss how we can help you move forward. Call our law office at (888) 584-9614 or contact us online to schedule your consultation.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Reading this content does not create an attorney client relationship with the author or their law firm.