Emptying bank account before divorce, is even possible? Many couples find joint bank accounts the easiest way to manage family finances. But no matter how surprised you are (or not) about the divorce, it’s important to act quickly and carefully to secure your finances — even if you don’t think your future ex-husband is the vengeful type.
Know that if your ex empties your joint accounts during the divorce, he will likely regret it. But, is emptying bank account before divorce an option?
However, if one of the parties withdraws a significant amount of common money immediately before or during the divorce, the court will likely hold him accountable.
What is a joint bank account?
When two people co-own a bank account, they share equal rights to the money. Any person can freely make deposits – or withdraw funds – without the express consent of the other. This means that technically anyone can empty the account at any time.
However, if emptying bank account before divorce, there will be consequences because the contents of that account will almost certainly be considered matrimonial property. That means it will be a fair division in the divorce settlement. This is true even if one person contributed much more to the account than the other.
A 2018 Bank of America survey found that about 28% of millennials give up their joint bank accounts when they get married, choosing to keep their finances completely separate. This can reduce conflict if you have two spouses who contribute about the same to joint expenses. However, you should know that even this will not necessarily protect that money from a fair share of a divorce. Balances in segregated accounts can still be considered matrimonial property.
What is Marriage Equity?
Matrimonial property refers to property belonging to both spouses. It could be money in bank accounts, retirement funds, the house you share, or your vehicles. Unless express instructions are given in a pre-marital or post-marital agreement, the matrimonial property must be divided equally between the spouses.
Matrimonial property is typically property acquired during the marriage. Property owned separately before marriage is generally considered separate property (think gifts or inheritances from others).
Joint bank accounts are almost certainly considered matrimonial property.
As New Jersey divorce attorneys can explain, the division of debt and assets does not have to be 100% equal. However, it will have to be fair, as explained in the N.J.S.A. § 2A: 34-23.1. An equitable distribution takes into account:
- The duration of the marriage;
- The age and health of both parties;
- The income/property brought into the marriage by both parties;
- The standard of living established during the marriage;
- The economic conditions (including income and earning potential) of each party at the time of the split;
- The present value of the property;
- The proposed tax consequences of the distribution;
- The need for a parent with physical custody of a child to own/inhabit the marital home and/or use/possess household goods.
Withdrawing money and spending or hiding from joint accounts during a divorce deprives the court of the opportunity to weigh everything. Often there are consequences.
Consequences of emptying bank account before divorce
If either spouse emptying bank account before divorce – especially with the express intent to rob the other spouse and/or defy a judge’s orders – there are likely to be dire consequences. The court will likely not only set this amount against the remaining assets and split the debt but will also punish the act with fines or an order to pay the other party’s attorney’s fees.
For example, if a woman withdraws $15,000 from her joint savings account a week before filing for divorce, her husband, in turn, could receive $15,000 in assets that her husband would have received in the divorce had she not removed that money and the court can to sentence you to pay your ex’s attorney fees.
Other ways emptying bank account before divorce can hurt the divorce settlement:
Require you to return lost money through monthly child support payments (or reduce the child support premium you may have received); require you to
- Pay some of your spouse’s bills (lawyers, forensic accountants, investigators, expert witnesses, etc.);
- Allocate more assets to your spouse than originally planned.
- Impose costly sanctions.
That’s why it’s important to consult a divorce attorney if you’re not sure when you can withdraw money from a joint account during the divorce.
Can I empty my personal bank account before divorce
Sure. But since your spouse owns part of the cash, you’ll be ordered to pay that over to them.
Can I legally emptying bank account before divorce?
For many couples, it makes sense to have a joint bank account to manage the family finances. These types of accounts can be very useful during a marriage, but in times of conflict or divorce, they can become weapons if used incorrectly.
Emptying bank account before divorce: major consequences
If either spouse drains emptying bank account before divorce and then files for divorce or withdraws money from an account against a judge’s order, he or she could face serious consequences (depending on the circumstances and what the money was used for). The court can order him to return the money, even if it has already been spent. Or, depending on the circumstances, the court may order the person to pay additional fines or the other party’s attorney’s fees.
The court can also impose penalties, such as adjusting the division of property to compensate for evicted funds.
Here’s an example: Taylor raised $10,000 from a joint savings account to go on vacation a few days before filing for Pat’s divorce. The court can punish Taylor by awarding Pat $10,000 in property that Taylor could have received had she not withdrawn the $10K from her joint account.
Protecting Your Assets during a Divorce
As you can see, it is important to remember that your joint bank account is considered matrimonial property. As with any other asset, it is essential to keep it safe so that it can be distributed fairly in the event of a divorce. It is not uncommon for judges to issue injunctions at the beginning of a divorce case that prevents both account holders from accessing the funds, except for specific approved reasons.
Once a divorce begins, anyone may want to transfer direct deposits or withdrawals to other bank accounts for security reasons. Or they can agree to close the joint account and split the money between their two separate accounts. However, before you or your close ex split the money in a joint account, you should speak with a lawyer first. Moving matrimonial property without permission, whether you or your ex, cannot be judged favorably by the court.
What do I do with my bank account before the divorce?
Suppose your spouse emptying bank account before divorce without your knowledge. Depending on your jurisdiction, there may be legal consequences. For example, if you’ve already filed for divorce and there’s a court order prohibiting both of you from doing certain things (such as withdrawing money), your spouse could be charged with criminal contempt. This is because the court wants to distribute all marital property fairly. If someone steps out of line, a judge may rule that the two of you have limited access to the joint account until the cases are resolved.
You cannot remove your spouse’s name from the joint account without their consent. Even if you worked for the same bank or credit union for years, a financial institution should not help you separate your spouse from assets that are rightfully theirs.
Try this instead:
Ideally, you and your future ex-spouse are still talking and can agree to close the joint account, split the funds, and open new accounts in your name. If not, don’t panic.
It is best to talk to a divorce attorney. Ask if it is legal and appropriate in your country to delete half of the contents of the account. Keep in mind that this is only possible if no divorce proceedings have been started yet.
Check any action you are considering with your attorney. If you are concerned that your spouse is emptying bank account before divorce, contact the bank, let them know that you are getting a divorce, and ask them to freeze the account so neither of you can release the money.
Ask your divorce attorney to inform your spouse that you have frozen the bill. If your spouse has a history of abuse or you are concerned that he or she may become violent, you can allow the courts to address it in the final decision. It is not uncommon for a spouse who has emptied bank account before divorce to be ordered to repay half of what he received, sometimes with associated fines.
In most cases, the court grants each spouse 50% of each of the funds held in a joint account. Even if one of you decides to take the money to insult the other (or to cover direct costs), that person would have to cough up to 50% to make the other person healthy.
Close your account
Once all the money has been divided and the account balance has been set to zero, it’s time to close it down forever. Depending on your relationship with your ex, you can either close the two together or one of you can kickstart and the other can sign documents later. Closing an account is as simple as showing identification documents and signing.
However, before closing the account, make a note of all scheduled direct deposits and automatic payments. Contact the involved parties directly to transfer these transactions to your new account.
Unlike closing a credit card, closing a joint account won’t affect your credit score, leaving you with one less thing to worry about. Right now, your main task is to take care of yourself, get back on your feet, and live as happy a life as possible.
Can I give all my money for a divorce?
When you are about to divorce or plan to divorce (or if you know your spouse intends to), be careful about the money you spend and the assets you give away. Why is spending money, giving money, or possessions a potential problem leading to divorce? In short, these acts can be understood as an attempt to conceal or conceal assets so that you can get more out of the matrimonial property that would otherwise be unfairly distributed.
As you may know, under the Illinois Marriage and Marriage Dissolution Act (IMDMA), all matrimonial property is identified and divided between the spouses based on an agreement that the court considers equal for both. If you try to avoid this equitable distribution of marital property, you could face hefty fines. Before emptying bank account before divorce, consult one of your attorneys.
Disclosure and Classification of Marital Property
When a divorce proceeding is underway, you must provide title deeds listing all of your assets and debts, both those that you believe are separated and those that you believe are matrimonial property. The court will determine which assets and liabilities should be classified as separate assets (meaning they will not be divided) and which of those assets and liabilities should be classified as marital assets (meaning they will be divided according to the rule of fairness).
Distribution: you must provide the court with information about all assets, and you may be required to provide detailed information about significant assets that you have recently issued or donated to the other party. Issuing or giving away assets that could qualify as matrimonial property can pose a problem.
If you want to emptying bank account before divorce that you know are separate properties, it may be beneficial to wait until the divorce is finalized. But if you must use real estate before or during the divorce process, you should work with a divorce attorney to ensure that the real estate is truly divorced and can be freely issued or donated without affecting your divorce.
Marital goals are different. If you give a family member or friend a significant amount from a savings account that you share with your spouse, or if you gift an expensive painting or rare book to a friend, the court may assume that you were trying to hide or conceal assets. Acquire a larger share of the properties.
Sanctions for Hiding or Concealing Marital Property
Hiding or concealing marital property can have serious consequences in an Illinois divorce. You may face legal penalties, including fines. In some cases, you may also be found guilty of contempt and be required to repay the goods you have given or given, plus a percentage of the value of those goods.
If you want to use the matrimonial property in an important capacity before the divorce proceeding, you should seek the advice of a divorce attorney to ensure that you are not penalized by the court.