Separate bank accounts don’t always protect finances during divorce

| Feb 26, 2020 | Divorce |

Millennials are often known to divorce differently than their parents. According to a recent report, nearly 30% of them aren’t committing to joint bank accounts after marriage. That may be due to the Millennials who witnessed their parents’ separation and saw how much financial hardship it caused them.

Some say that keeping finances separate can make divorces easier. However, this can be a common misconception. Just because a person’s name is on a specific account or they own the deed to a house doesn’t always mean it’s theirs to keep.

Having separate bank accounts doesn’t always secure assets

Contrary to the advice of many financial professionals, having a “yours, mine and ours” system may not always be the best way to protect finances during a divorce. In many cases, this method of marital money management provides more of a psychological benefit rather than a legal one.

As Pennsylvania is an equitable distribution state, the division of marital property typically gets decided by a judge. Depending on the outcome, a couple’s assets could get divided fairly but not always equally. For example, a court may decide that one spouse’s separate assets should be used to give spouses a fair deal.

Couples have options for protecting separate assets

Luckily, couples have options available for protecting their assets during a divorce. Here are a few approaches they could use:

  • Get a prenuptial agreement
  • Save digital copies of account statements a month before getting married
  • Keep family inheritances separate

Depending on each couple’s circumstances, they should manage their finances in a way that’s comfortable for them. While it may take some extra time and effort, it can be better to be prepared.