Separate Bank Accounts and Divorce: Not So Separate
Many people choose to maintain separate bank accounts when they get married. There’s a lot of good reasons to do so: it helps keep each partner accountable for their income and expenditures, allows for financial independence, and, with the addition of a joint bank account, can be a great way to keep track of mutual expenses. One thing a separate bank account won’t do, however, is protect your assets in the event of a divorce.
California is a community property state
No matter what state you live in, having a separate bank account is no guarantee that your assets won’t become you and your spouse’s assets following a divorce. In California, it makes almost no difference what bank account your assets are in.
That’s because California is a community property state. This means that under California law (as well as the laws of nine other states), everything you and your spouse earn while married is considered marital property. There are some exceptions for personal gifts from third parties, but, generally speaking, what’s “yours” is not necessarily legally considered “yours”.
How to protect your assets during a divorce
The best thing you can do to protect your assets during a divorce is to sign a prenuptial agreement with your partner before you get married. Also known as a prenup, this will describe how your assets will be divided if the marriage dissolves. We have worked with countless couples to develop prenuptial agreements that work the needs of both parties.
If you’re already getting a divorce and don’t have a prenuptial agreement, then you’ll need an experienced divorce lawyer who can demonstrate what assets you owned before your marriage that don’t fall under community property laws. When it comes to divorce, there’s almost always a process of compromising and choosing priorities. At the office of Ernest A. Casacca, we talk all of our clients through their options so they can choose the path that works best for them.
So enjoy your separate bank accounts, but don’t count on them to protect your assets during a divorce.