Most divorcing couples that I have encountered have either separate or joint bank accounts. My husband and I use a joint bank account for bills and savings, but use separate accounts for our IRA’s. However, divorce attorneys always worry when they encounter couples who have only separate bank accounts. Eventually, they will ask if these assets are solely theirs. When they do ask, I have to break the bad news.
Who Owns the Money?
Couples who established bank accounts after the marriage began must divide these accounts equally when seeking divorce. Specific accounts that contain marital funds are the marital property of both parties. The name on the account is not important when it comes to deciding who “owns” the account for divorce purposes.
Divorce lawyers and courts look at bank accounts in two ways: community property and separate property. Couples split community property (like money in a bank account) equally. Meanwhile, couples who each own separate property keep their specific accounts or property. Judges will award separate property to the person judged to be the sole owner of that separate property.
What is Community Money?
Divorce courts use the word “community” to describe assets owned by both spouses in a marriage. If you purchase a vehicle while married, is is considered a “community vehicle.” If you used your credit and the vehicle is titled in your name, it is still considered community property.
This also relates to any purchased property, the furniture inside the properties, any money placed in bank accounts opened after the marriage began, and acquired stocks. During a divorce, community property is equally divided unless there are claims of marital waste. Any debts incurred during the marriage becomes community property of the couple and will need to be divided. Hiring a divorce attorney will be of significant value when going through this process.
The court may label your assets as “separate” if one spouse came into the marriage with previously owned property, or they are gifted property after the marriage began. For example: You came into the marriage with a bank account worth $50,000. During the marriage, you never added your spouse’s name to the bank account. This specific bank account would likely be declared separate property and not subject to being divided equally in a divorce.
When is Separate Not Separate?
Commingling is defined as ‘to combine funds or properties into a common fund or stock’. The main issue of property commingling occurs when separate and community property are mixed. The separate property is then considered to be community property and will be split equally between the divorcing parties.
Commingling can happen in several different ways. One common scenario occurs when you add your spouse’s name to a bank account.
- You added you spouse’s name to your bank account worth $50,000, and you and your spouse both use the account to deposit paychecks and pay bills. The original amount has been commingled. A family court judge would probably consider the $50,000 as community property.
- If your spouse’s name is not added to the bank account, but you both use the account to deposit paychecks and pay bills, commingling can also occur. The court could consider the original amount as separate property if your divorce attorney made a compelling argument. Detailed records can strengthen your argument. This could prove useful if the marriage has lasted for a significant time.
For a more detailed description of what is considered “separate” and “community” property, please review our article written by one of our skilled divorce lawyers: Division of Property and Debt.
How to Keep a Bank Account Separate?
There are ways to keep a bank account completely separate in the eyes of the court:
- The account should have only your name on it, not your spouse’s.
- The account should not receive deposits of community property. Money earned during the marriage cannot go into the separate account.
- Any inheritance money or gifts made to you can go into a separate account. If the gift has both spouses’ names on it (such as a wedding gift check), it can’t go into the separate account without commingling the funds.
Remember to keep detailed financial records from all bank accounts before, during, and after your wedding. These records can be helpful should you need to file for divorce. Many divorce attorneys will use these records if you want to prove that your accounts should remain separate.
Have your bank accounts become commingled? Call Right Divorce Lawyers at (702) 914-0400 to speak to one of our divorce lawyers about your case.
FAQs
Couples who established bank accounts after the marriage began must divide these accounts equally when seeking divorce. Specific accounts that contain marital funds are the marital property of both parties. The name on the account is not important when it comes to deciding who “owns” the account for divorce purposes.
Do separate bank accounts help in divorce? ›
Having separate bank accounts at the right time can be essential in navigating the divorce process without creating undue hardship or added confusion. However, it's essential to understand what you can and cannot do financially when you are divorcing to avoid making missteps that can have serious legal consequences.
How do I protect my bank account during divorce? ›
Open Your Own Bank Account
Most couples choose to establish a joint bank account when they get married. During a divorce, though, you should set up a bank account solely in your name as soon as possible. This step is especially important for spouses without jobs or who have been stay-at-home parents before the divorce.
Can a spouse hide bank accounts in a divorce? ›
Under California law, a marital relationship is a confidential relationship requiring the highest good faith and fair dealing. Accordingly, California law provides that all spouses have a duty to make a full disclosure of all their assets and provide equal access to all information related to their finances at divorce.
Is it a good idea for spouses to have separate bank accounts? ›
Separate accounts can also allow each partner to retain their financial independence and spend or save how they want. That, in turn, may lead to more harmony in a marriage if each spouse doesn't feel as if he or she has to justify spending habits.
Can I empty my bank account before divorce? ›
It is possible that you will lose your right to your property and that you will be denied access to the financial resources you believe belong to you. Key Takeaway: Do not remove any funds from a joint bank account before the divorce proceedings are complete.
Does my husband have to pay the bills until we are divorced? ›
Until you have a court order, any property or debt from your marriage still belongs to both of you. This is true no matter who is using it or who has it with them. The same is true of debts.
How do I protect myself financially in a divorce? ›
How to Financially Protect Yourself in a Divorce
- Legally Establish The Separation Or Divorce. ...
- Get A Copy Of Your Credit Report And Monitor Activity. ...
- Separate Debt To Financially Protect Assets. ...
- Move Half Of Joint Bank Balances To A Separate Account. ...
- Comb Through Assets. ...
- Conduct Cash Flow Analysis.
Divorce lawyers and courts look at bank accounts in two ways: community property and separate property. Couples split community property (like money in a bank account) equally. Meanwhile, couples who each own separate property keep their specific accounts or property.
Can I remove myself from a joint bank account during a divorce? ›
State law or the terms of the account often mean you cannot remove someone else from a joint bank account without their consent. But you should be able to remove yourself unless the bank specifically prohibits it.
Financial infidelity happens when you or your spouse intentionally lie about money. When you deliberately choose not to tell the truth about your spending habits (no matter how big or small), that is financial infidelity.
Does a wife have access to her husband's bank account? ›
Only the account holder has the right to access their bank account. If you have a joint bank account, you both own the account and have access to the funds. But in the case of a personal bank account, your spouse has no legal right to access it.
Are bank accounts frozen during divorce? ›
The court has the power to freeze your bank accounts and other marital assets when you're in the middle of a divorce. We're not just talking about the house, cars, and furniture. Marital assets can include insurance policies, bank accounts, inheritances, and more.
Why won't my husband give me access to his bank account? ›
One potential reason your husband isn't showing you his bank account is that he has something to hide. If he's very resistant, it may be that he doesn't want to show you something he's purchased. Maybe because he's spending money irresponsibly, or perhaps he's hiding past financial secrets from you.
What percent of marriages have separate bank accounts? ›
Recap. Marriages come in all shapes and sizes, and couples do various things either combining or not combining money. We know that the percentage of married couples with separate bank accounts is 39% at least for those having completely separate accounts.
Can I get my husband's bank statement? ›
But without consent of holder you cannot take statement printout. You have done an offence by accessing your husband account without his consent. If you want to save your job and also want to get divorce ask him to settle the matter by way of compromise.
Can one spouse clean out bank account? ›
In short, whether a spouse can (or should) empty a bank account before a divorce depends on many factors, one of which is whether the funds are clearly your separate, non-marital property, and whether the spouse can prove that in court.
Do I have to give my wife money if we are separated? ›
Well, it depends. The Court will consider both the needs of the applicant (the person applying for spousal maintenance) and the respondent (the person asked to pay spousal maintenance). In doing so, they will consider: The age and health of both parties, and their ability to work and earn a living.
Should my wife have access to my bank account? ›
Only the account holder has the right to access their bank account. If you have a joint bank account, you both own the account and have access to the funds. But in the case of a personal bank account, your spouse has no legal right to access it.
