Studies on the causes of separation show that divorce due to infidelity and financial dishonesty is very common in couples. Just as cheating and divorce are discussed simultaneously, financial infidelity and divorce are commonly discussed together. It refers to negative money-related behavior in which one partner deceives the other by hiding assets or finances. This behavior can destroy trust, breed resentment, and lead to major financial problems.
A 2018 Bank of America survey shows that millennial couples are no longer opting for a simple joint bank account. Instead, they’re choosing to keep their finances separate. In fact, many divorce attorneys recommend that couples have separate bank accounts. Although it doesn’t entirely safeguard your relationship from financial infidelity, it can have some benefits. Specifically, it prevents one spouse from using marital assets and racking up large amounts of debt.
Here are some of the top reasons divorce attorneys recommend keeping separate accounts when married. If you want to learn more about separate bank accounts follow this link – https://rightlawyers.com/separate-bank-accounts/
You Stay Independent
Perhaps the biggest benefit of having separate accounts is maintaining a sense of autonomy regarding finances. Not having to ask for permission for every individual purchase can help you retain a sense of financial independence, empowerment, and self-identity. When you don’t pool all your finances together, it also means that you don’t feel trapped in the relationship. By keeping some funds separate, you can make rational decisions that aren’t influenced by your dependence on your partner.
You’re Prepared For The Worst
When a relationship turns sour and one partner limits access to the joint account, it can leave the other partner in a difficult position financially. By keeping funds in separate accounts, you’ll have access to money without having to worry that your spouse will lock you out of the account. If one person has control over the joint bank account and credit cards during a divorce, the other will need to go to court and get orders to pay for common expenses. This makes having separate accounts much more preferable.
You Become Financially Savvy
It’s common for couples to adopt an ‘I’ll do this, you do that’ mentality when dividing household chores and responsibilities because it makes things efficient. However, one spouse taking the lead in managing finances puts the other partner at a disadvantage. When couples get divorced or the financially savvy partner passes away, divorcees and widows end up struggling with debt management and simple budgeting to manage their expenses. By keeping separate accounts from the get-go, you and your partner can stay on top of finances.
Secures Pre-Marital Savings
With the rise in blended families and people getting married later in life, it’s common for spouses to enter the marriage with pre-marital savings. These can include money you saved up after you started working or inheritance from a grandparent. Either way, keep in mind that any assets you acquired before marriage aren’t considered marital property, so you’re not obliged to keep them in a shared account. Doing so could cause a comingling of your finances, making it difficult to reclaim them as your own in the event of a divorce. Not to mention, merging pre-marital savings in a joint account could result in your spouse claiming half of it if you get divorced.
You Don’t Nitpick Each Other’s Expenses
When you and your spouse don’t see eye-to-eye on things, it’s difficult to be on the same page, especially when it comes to finances. If you have vastly different spending habits, it results in one nitpicking the other’s purchases. It can get to a point when you’re continuously monitoring your partner’s expenses.
But with separate accounts, you and your spouse can decide how much money each person contributes to household expenses. It allows both parties to enjoy their purchases without worrying about the other contesting every dollar. Not to mention, it prevents you from developing feelings of resentment and reduces the risk of you arguing over purchases.
Helps Prevent Money-Related Disagreements
Just because you’re married doesn’t mean that you can’t have different financial priorities. Maybe you need to make spousal support and child support payments from a previous marriage. Or, maybe you just want to enjoy your purchase without worrying about getting into arguments. Having separate accounts can encourage partners to trust each other and work on specific, shared financial goals.
Protects Your Partner From Your Creditors
Just as more people are entering marriage with pre-marital savings, it’s become quite common to acquire some debt before getting married. This can include student loan debt, credit card debt, or even medical debt.
Regardless of the type of debt, merging your funds in a joint account could lead to creditors garnishing your spouse’s hard-earning wages. The same applies if your spouse has pre-marital debt and you want to avoid taking a hit on your credit score because of their debts. Divorce attorneys recommend discussing how you and your spouse will deal with pre-marital debts – before tying the knot.
Do Separate Accounts Protect Your Money in a Divorce?
While keeping separate accounts comes with benefits, protecting your money in the event of a divorce isn’t one of them. Even if the account only has your name on it, that doesn’t mean it’s yours alone.
Once you’re married, it’s wrong to assume that any assets accumulated during marriage will remain yours because you kept them in a separate account. If you’re about to get married or are currently married and want to protect your assets in the event of a divorce, consider consulting a family attorney.
Having Joint and Separate Accounts
Of course, there’s no need to settle for just one option: it’s possible to have both joint and separate accounts. In addition to having separate individual accounts, you can share a joint account for shared expenses such as utility bills, family vacations, and mortgage payments.
If you decide that keeping both separate and joint accounts is the best way to manage your money, it’s best to have a detailed discussion as to how much each partner will contribute.
