It is no secret that one of the most common reasons for a couple deciding to divorce is money troubles. Some may deal with uncontrolled spending, unmanageable debt or even keeping secret bank accounts. Because of this, some financial advisors believe it may be beneficial for certain couples in Michigan and beyond to keep their finances separate. Doing so may spare them the heartache of divorce and the financial devastation of property division.
One reason for keeping money separated may be that one or the other spouse has obligations from a previous marriage. This may include child or spousal support or other responsibilities stipulated by a divorce agreement that may require one to set aside funds. Additionally, one spouse may wish to maintain control over an inheritance to keep it from leaving the family in the event of a divorce.
Many times, two people will opt to separate the money if there have been bad experiences in the past. If, for example, one spouse has little sense about spending and saving, they might keep individual accounts so the bills will be paid on time. On the other hand, a spouse who comes from a history of poor money choices may feel reluctant to relinquish control of his or her earnings. Such a couple may keep individual budgets for that partner’s peace of mind.
While some in Michigan may find that their marriage is more successful when they do not mix their money, even separate bank accounts may not be enough to prevent discord. When this happens and divorce is inevitable, it is important for people to understand that assets accumulated during the marriage may still be divided under property division laws for most states, even if they are held in separate accounts. It is helpful to have a family law attorney to advise one in these matters.
Source: businessinsider.com, “The case against completely merging finances with your spouse“, Shana Lebowitz, Nov. 7, 2016