LEGAL GUIDE
Written by Avvo Staff | May 16, 2014

Withdrawing Funds from a Joint Bank Account Before Divorce

When considering filing for divorce, it is important to protect yourself as much as possible. Protecting your money and finances is an important step for creating a new life. One of the best ways to protect your financial future is to withdraw money from your joint bank account and place it in a personal account. Before taking this step, however, it is important to consider the legality of such an action, if it is necessary, and how to do it.

Is it Legal to Withdraw Funds?

You can legally withdraw up to half of the money in a joint bank account before the divorce is filed. It is extremely important that this is done before the divorce is filed; otherwise you are violating the law. Once divorced, all of your joint bank accounts must be liquidated and split between the two parties. Your checking and savings, any bank deposit boxes, credit cards, investments, and all other property will be divided and distributed by the court. However, before you file for divorce, you can legally withdraw up to half of the money in a joint bank account. This is what you would be entitled to in most divorce settlements.

However, be advised that taking this step without your spouse’s knowledge may make the divorce more hostile.

Reasons for Withdrawing Funds

It is recommended for spouses to work together to split the bank account before filing for divorce. Whenever possible work out financial and property changes face to face with your spouse. However, if you anticipate a hostile divorce, then it might be necessary to withdraw half of the money from your joint account before your spouse can withdraw all of the money, or place a freeze on the account.

In a hostile divorce, it is common for one spouse to withdraw all the funds from a joint bank account. This is not advised, as it will cause extra legal troubles during the divorce. The other spouse will likely want his or her half of the funds returned, and whether or not the funds are returned is a case by case basis. Often withdrawing all the money from a joint account can start a battle for which there is no pleasant ending. If you do choose to withdraw all funds from a joint account, you are obligated to preserve all of the money until the divorce is finalized. Doing otherwise could mean that you get less in the final property settlement.

Either you or your spouse can freeze activity on your bank accounts by filing a restraining order or mutual property injunction, making it impossible for you or your spouse to withdraw or add to the funds without authorization from both parties. Keep in mind that once a restraining order or mutual property injunction is served, no one can make withdrawals (other than household and living expenses) from a joint or personal account.

Steps for Withdrawing Funds

Once you have decided to withdraw your money from the bank account, you need to follow these tips, and be prepared for a negative response from your spouse.

The first step is open a bank account in your name only.

  • Pick out a bank, and visit them in person or online. It is generally faster to do this in person.

  • You will need your Social Security number, your name and birthdate, and a valid form of identification such as a driver’s license.

  • After you have done this and your new account is active, you can transfer funds from the joint account to your personal account. You can transfer funds using the routing number. Many banks allow you to do this online.

The next step is to keep records of what the money from your joint account is spent on, just in case your actions are called in to question. It is better to be prepared than blindsided.

  • Store these records, and all other financial information in a place other than your shared residence. This way your spouse has no opportunity to access them.

  • If possible, put the money or a portion of it into a savings account in case your spouse’s attorney calls your actions into question.

  • In addition, you should be sure to close out or reduce all joint credit card accounts once the divorce is filed.

Finally, now that you have protected your finances, you need to let your spouse know, and make sure there is sufficient money left in the joint account.

  • You need to leave enough money in the joint account to pay for household expenses and monthly bills.
  • Once you have filed the divorce, be sure to inform your spouse of what you have done.

If ever in doubt, talk to a divorce attorney to make sure your actions are legal and will put you in the best possible position for the divorce settlement.

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