Separation And Joint Bank Accounts | Hooper & Mill Family Lawyers, Divorce Lawyer, Brisbane (2024)

FAQs

Are separate bank accounts safe from divorce? ›

The court may consider separate bank accounts jointly-owned.

While you may think that separate property would always include the bank account you established prior to your wedding, merely keeping separate accounts may not provide the legal protection that couples are looking for.

The money in joint accounts belongs to both owners. Either person can withdraw or spend the money at will — even if they weren't the one to deposit the funds. The bank makes no distinction between money deposited by one person or the other, making a joint account useful for handling shared expenses.

The simple answer to that question is yes. Parties may open up their own bank accounts during a divorce. However, it is very advisable to keep the financial status quo during a divorce, especially until an arrangement can be made, both on a temporary or pendente lite basis and obviously a permanent basis.

That means you cannot empty your joint account unless your spouse consents or you get a court order first.

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.

Many married couples have joint bank accounts. Each spouse has the right to make deposits into the account, and, each spouse has the right to withdraw from the account any amount up to the total balance. It's common for married spouses to have joint accounts for practical and romantic reasons.

Short- or long-term spousal support, also called separation maintenance (or alimony in a divorce) may be required if one partner is financially reliant on the other. You may also be entitled to spousal support if your marriage lasted a certain period of time, or because of a variety of other factors.

Can I do that? Generally, no. In most cases, either state law or the terms of the account provide that you usually cannot remove a person from a joint checking account without that person's consent, though some banks may offer accounts where they explicitly allow this type of removal.

If you decide to keep the account active, bear in mind that either of you can withdraw money whenever you want, unless the terms and conditions of your joint account provide otherwise. The financial institution will not monitor any withdrawals your ex makes, even if it was notified of your separation.

Is it better to have a POA or joint bank account? ›

One major drawback of joint bank accounts is the automatic transfer of ownership upon the death of one account holder. This can bypass the deceased's will and complicate estate planning. A POA does not grant ownership; it merely allows the agent to act on behalf of the principal.

A joint account might damage your credit score

Opening a joint account adds a financial link to the other person. This means companies will look at both of your credit histories as part of any credit checks. If they have a poor credit history, this might lower your chances of acceptance.

Split your jointly held accounts down the middle and transfer your balances to separately held accounts. You will need to ensure that you transfer any direct deposits or withdrawals to your new account. Once you are divorced, ensure that you change the beneficiary of your life insurance or retirement accounts.

Penalty for Hiding Assets in Divorce

Hiding matrimonial assets is illegal under any circ*mstance. Willful non-disclosure can be punished, which means that if your spouse intentionally about their assets, they can be punished.

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.

As noted, a prenuptial agreement can be one of the best ways to protect assets if you have concerns that a marriage may eventually end in divorce. A prenup can specify which assets each spouse is entitled to should the marriage end and what type of spousal or child support may be provided.

If your husband passed away and you are not listed on his bank account, the account will likely go through probate unless it is a joint account or has a named beneficiary. Probate is a legal process where the court oversees the distribution of assets.

1. To maintain independence. Sharing money may help you feel like part of a couple, but you will want to make sure you have the same financial management expectations. Many couples keep separate accounts for paying bills or saving for a vacation.