Most married couples feel joint bank accounts are the easiest way to manage family finances. However, regardless of how surprised you are or aren’t by a divorce, it’s essential to act quickly and protect your finances – even if you don’t think your soon-to-be-ex-spouse is the vindictive type.
Know that if your ex-spouse does empty your joint bank account during a divorce, they would likely regret it.
Our Greenville family law lawyers know that money is a significant concern for both sides during a divorce. However, if one spouse withdraws a significant amount of money from joint funds for any reason just before or during a divorce, the family law court will most likely hold them accountable for their actions. If you’re wondering what to do with joint savings during a divorce, it’s essential to speak with an experienced divorce attorney. At Greenville Family Attorneys, our experienced Greenville divorce attorneys have many couples going through a divorce safeguard their assets and we can help you, too. To schedule a no-cost initial consultation, contact our Greenville family law firm today at (864) 475-9393.
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How Do I Protect My Assets During Divorce?
To protect your separate property when separating your finances and closing joint accounts during a divorce, you must:
- Build your financial identity. First, open a bank account in your name only. This will allow to pay for everyday expenses while unwinding your joint finances.
- List all debts and properties in your name. With the help of a financial advisor, calculating your net worth ahead of the divorce process. This will help with the division of jointly owned assets.
- Document your date of separation. Depending on where you live, you might need to be separated for at least six months or more before you can file for a divorce in South Carolina.
- Set a budget and financial goals. Settling into a single life at the end of your marriage includes budgeting for it. Note all your financial obligations, including utility bills, rent, bank account balances, credit card and loan repayments, retirement accounts, investments, tax records, and insurance policies.
What Happens to Joint Bank Accounts When Divorced?
You can’t remove your spouse’s name from joint accounts without their permission. Even if you’ve banked with the same credit union or bank account for years, financial institutions aren’t allowed to help you remove your spouse off from assets that are legally theirs.
However, if you and your former spouse are still on speaking terms, you can agree to close the joint account, split the joint funds, and open new bank accounts in your separate names.
Next, speak with an experienced divorce attorney. Ask if it is legal in your state to withdraw half the funds in your joint account. However, it’s essential to note that this option might not be permissible if divorce proceedings haven’t begun.
Inform your family law attorney about any action you consider. If you’re worried your soon-to-be-ex-spouse may empty your joint bank account and take all the co-mingling funds, contact your bank. Inform your bank that you’re divorcing your spouse, and request they freeze the joint funds so that neither of you can empty the joint account.
Ask your divorce lawyer to inform your spouse that you have put a freeze on the joint account. If your spouse has a history of domestic violence or you’re concerned that they will become violent, allow the court to deal with the issue in the final decree. Often, spouses who withdrew joint funds from a joint bank account are ordered to repay half of the money they took, sometimes with criminal penalties attached.
Often, the family law court awards each party 50% of each of the common funds held in a joint bank account. Even if one spouse emptied the joint account to spite the other or to cover everyday expenses, that spouse would have to repay 50% to make the other party whole.
Once all joint funds have been divided and the joint bank account has a zero balance, it’s time to close it for good. Depending on your relationship with your former spouse, you can either close the account together, or one of you can close the account and the other can sign the paperwork later. Closing a joint bank account is as simple as showing your identification and signing documents.
However, before you close the joint account, note any scheduled direct deposits and auto-payments. Notify the parties involved immediately and request them to transfer those transactions to your separate bank accounts.
Unlike closing a credit card, closing a joint bank account won’t affect your credit rating.
Can I Withdraw Funds From a Joint Account During Divorce?
Typically, a family court judge will order an Automatic Temporary Restraining Order (ATRO) at the start of the divorce proceedings, which restricts either spouse from withdrawing funds from the joint account except for pre-approved reasons. If you withdraw funds from the account during divorce, you face severe repercussions. Often, the spouse who emptied the joint account will have to pay back the funds or give up other marital assets to cover the money they withdrew.
Can You Empty Joint Bank Account Before Divorce?
If one spouse withdraws the entire amount in a joint bank account intending to deprive the other party of the funds and/or in defiance of a family court judge’s orders, they’ll likely face legal repercussions. The family law court will not only offset that amount in the remaining marital asset and marital debt division. Also, the court will penalize that spouse with hefty fines or an order to pay the other party’s attorney fees.
For instance, if a husband withdraws $20,000 from a joint savings account two weeks before filing for divorce, his wife may receive $20,000 worth of marital property her husband may have otherwise received in the divorce settlement had he not withdrawn the funds and the family law court may order him to pay his ex’s lawyer’s fees.
Other ways this could harm your divorce settlement:
- The family court judge may require you to repay the missing funds through monthly alimony payments or the court may reduce the alimony award you may have otherwise received;
- The judge may ask you to pay some of your spouse’s expenses, including lawyer’s fees, forensic accountants expenses, costs for investigators, and expenses for expert witnesses;
- Award more marital property to your spouse.
- Impose costly sanctions.
Our Experienced Divorce Lawyers Can Help You Protect Your Assets During a Divorce
You should always consider your joint account as marital property. And, like all your valuable marital assets, keep these accounts secure so that in the unfortunate event of dissolution of marriage, your assets and funds are divided equitably. Sometimes, the family law court may order limited access to the joint bank account by both parties, with approved exceptions.
If you’re in the early stages of the dissolution of marriage, you must maintain the “status quo.” This means you must keep your direct deposits going into your joint accounts unless your family law lawyer advises you otherwise based on your unique situation. Or you and your former spouse may decide to close the joint bank account amicably and split the joint funds between your separate accounts. However, it’s crucial to speak to a family law attorney before making any moves, especially during this difficult time.
Make sure you protect your assets in the event of a divorce. The Greenville divorce lawyers at Greenville Family Attorneys are here to help. Our experienced divorce lawyers are here to answer all your queries. Please call our Greenville family law firm today at (864) 475-9393 or use our contact form to schedule a no-cost initial consultation at our Greenville law office.