Millennials seem to be bucking a lot of trends. Not only are they getting married at lower rates, but when they do decide to tie the knot, many are deciding to forego the tradition of merging finances and opening a joint bank account. In fact, 28% of married millennials have opted to keep their finances separate.
The reasoning behind this is that many millennials are children of divorce. They have seen their mothers and fathers split up and experience money issues as they split assets in a divorce. As a result, many couples are scared to merge their money. Also, apps such as Zelle and Venmo make it easier than ever to split costs.
However, those who think that simply keeping finances in separate accounts will protect them should the marriage end are in for a rude awakening. Just because a bank account is in your name does not mean your spouse does not have access to it in a divorce. The same applies to deeds on the house and titles on cars. Once you get married, all assets that are acquired during the marriage become fair game in a divorce proceeding.
Even though Maryland is an equitable distribution state—rather than a community property state, which splits assets 50/50 in a divorce—if you earn the money, it can still be split with your spouse in a divorce. That’s because assets acquired during a marriage can still be considered marital property. Therefore, you shouldn’t rely on separate bank accounts to safeguard your money in the event of a divorce.
That’s not to say that having separate accounts is not a good idea at all. Having two or more separate accounts—say, one for each spouse and another for marital expenses—can reduce conflict in a marriage. This is especially true if both spouses work and want to keep things equal. For example, marital expenses, such as mortgage payments and utility bills can be paid from a joint account, while personal expenses such as new shoes or a haircut, can be paid from personal accounts.
In fact, it is recommended that each person has an account and credit card in their name only, so they will always have access to money in an emergency. For example, if the marriage turns sour quickly, one spouse can use their money to find a new place or hire a lawyer, and not worry about their spouse cutting them off from the money. A separate account, however, will not legally protect one’s money in a divorce, so that’s something to keep in mind.
When it comes to asset division in a divorce, the court will decide what is fair. Keeping money in separate accounts will not protect the money you earn.
If you are divorcing, Columbia divorce lawyer Todd K. Mohink can provide you with the financial help you need. While protecting all the money you have saved up during the course of your marriage may not be feasible, he can help you achieve a favorable outcome. For a free consultation, fill out the online form or call (410) 774-5987. We have two offices to serve you.
7310 Ritchie Highway, Suite 910
Glen Burnie, MD 21061
30 Corporate Center
10440 Little Patuxent Parkway,
Columbia, MD 21044