4701 Oleander Drive, Suite A
Myrtle Beach, SC 29577
Will separate bank accounts protect my money in a divorce?
The short answer is probably not, although separate bank accounts may protect your non-marital assets in a divorce…
How does equitable division work when there are separate bank accounts? Do I need to worry about my non-marital assets becoming marital assets? How can I protect myself and my money in a divorce? Below, I’ll talk about why keeping separate bank accounts is not the best strategy to protect your money in a divorce in SC, as well as some methods that do work to protect your money in a divorce.
If you are considering divorce – or if you are considering marriage and you are thinking about ways to protect yourself in the event of a divorce – call the Myrtle Beach divorce lawyers at Axelrod and Associates now for a free consultation.
If we keep our money in separate bank accounts, we are making it clear that we don’t intend for our money to be marital property, right?
Not so fast…
In SC, separate bank accounts may not protect your money. Money and other property that is brought in while you are married will most likely be considered marital property, which means that it will be subject to equitable division by the family court during your divorce proceedings.
Regardless of whose name is on the bank account, money and property accumulated during the marriage may be subject to equitable division by the family court. The Court will not necessarily split marital assets 50/50, either. The decision is made after considering factors that include:
This doesn’t mean that you should never have separate bank accounts, and separate bank accounts can help to protect your property in some cases.
For example, if you have money in your bank account at the time that you enter the marriage, that money is non-marital property. How can you protect it and keep it from becoming marital property?
If you maintain a separate bank account and keep careful records, you may be able to preserve your money as non-marital property. On the other hand, if you commingle your pre-marriage funds with income during your marriage, use the non-marital funds for marital purposes, or add your spouse’s name to the account, the funds can be transmuted into marital property that will subject to equitable division.
Although it may not affect the family court’s decision as to the division of assets, there are practical reasons to maintain separate bank accounts. For some people, it just makes sense to have separate bank accounts for personal expenses and a joint bank account to pay bills, or to just have two separate bank accounts and decide who pays which bills.
Another benefit to separate bank accounts is that your spouse cannot deny you access to your funds if you become involved in a bitter divorce – even if the funds are considered marital property, it makes sense to protect yourself by having at least one bank account and one credit card in your name only…
Although keeping separate bank accounts may not protect your money in a divorce, there are other things that you can do to safeguard your assets, including:
Before you tie the knot, take stock of your assets and ensure that your pre-marital assets and funds are maintained separately. Keep a separate bank account and records for your money and do not add your spouse’s name to the title of any property that you do not want to become marital property. Be careful not to commingle the funds or use them for marital purposes.
Similarly, if you receive an inheritance, keep it in a separate account, do not add your spouse’s name to the title of any property, and take care not to commingle funds that came from the inheritance.
The single most important thing that you can do to protect your money in a divorce is to enter into a prenuptial agreement before you are married.
In the prenup, you can predetermine how your property will be treated in the event of a divorce, including:
If you do not enter a prenup, all marital property will be subject to equitable division by the family court and that may include money that is kept in separate bank accounts…
Another way to protect yourself is to enter a separation agreement with your spouse as soon as you know that you are considering divorce. Talk to your Myrtle Beach divorce lawyer on the Axelrod team early in the process so that we can negotiate the best outcome before you get to your divorce hearing.
The separation agreement can decide terms like child support, child custody and visitation, alimony, and disposition of assets. Although the family court is not required to honor your separation agreement, in most cases the court will adopt the terms of the agreement in the final divorce decree if it is fair and in the best interest of your children.
Keeping separate bank accounts will not necessarily protect your money in a divorce in SC, but there are other ways to preserve your assets.
The fields marked with * are mandatory.