Married couples often open joint bank accounts to manage their household expenses more efficiently and save for common goals. Unfortunately, these accounts can lead to complications if the couple decides to part ways. What should you know about the challenge of dividing joint bank accounts in divorce?
Financial unity during marriage can become a source of conflict in divorce.
When a marriage heads towards divorce, the unity once symbolized by a joint bank account often turns into a battleground. Joint bank accounts become sources of conflicts during divorce proceedings. Shared bank accounts can make it challenging to track who spent what. This can lead to disputes over how much each party should rightfully receive.
Because both parties have access to the funds in a joint account, one spouse could also misuse that power to gain an advantage during divorce. For example, if one party empties the account without the other’s consent during a divorce, it can leave the other without the funds they need for daily expenses. People can address this issue during property division, but one spouse will still need to deal with the immediate financial strain of losing their savings.
How can you limit conflict over a joint bank account?
To minimize conflict, consider the following strategies:
- Separate or freeze your accounts as early as possible – As soon as you anticipate a divorce, it might be wise to discuss separating financial accounts or to freeze those accounts during the divorce.
- Seek financial and legal advice – Consult a divorce attorney or financial advisor before making decisions about joint accounts. They can help you make informed financial decisions while separating your accounts.
- Communicate during the divorce process – Maintain open lines of communication with your soon-to-be ex-spouse bout the joint account to manage funds, expenses, and debts efficiently and prevent misunderstandings.
- Document everything – Document all transactions from the joint account during separation to have clear evidence for any disputes that may arise.
- Create a temporary agreement – During your divorce, it might be practical to create a temporary financial agreement that outlines how you will pay bills, who will contribute to what and how much each person can withdraw from the account.
Managing a joint bank account during divorce can be challenging. However, it is possible to manage your joint bank account more effectively during this difficult time.