It seems to make a lot of sense for spouses to share a joint bank account. They're most likely shouldering up under the same financial responsibilities, so it's logical to pool money in a single account and use it to pay marital bills. The arrangement doesn't come without risk, however, particularly if your marriage heads south.
A Joint Account Means Equal Ownership
Whether you and your spouse share a joint account or you open one with someone else – such as a friend, adult child or other family member – the rules are the same. Both holders of the account have the same right to the money in it. These rights are not limited to 50 percent or what might seem like each's rightful share, but the entire balance. In most cases, your spouse can wipe out the joint account and the bank has no legal right or responsibility to stop her. However, some exceptions exist. If you set up the account with additional protections against one account-holder cleaning out the balance, your bank must honor those terms.
If You're Headed for Divorce
Joint ownership of an account may not pose a problem if you and your spouse are happily married and you're on the same page when it comes to money management and budgeting. If you're not, and she empties the "Mary or Joe" account without your consent, you have no recourse with the bank. If you're in the process of getting a divorce, however, this changes things.
Divorce laws vary significantly from state to state, but marital assets usually are divided close to 50-50 when spouses part ways. This effectively means that if you're going to file for divorce, half the money in the joint account is rightfully yours, according to the law firm of Zelenitz, Shapiro and D'Agostino in New York. Your spouse can't take this half because divorce law supersedes the rules banks must operate under for joint accounts. If she does, you can make a claim for reimbursement as part of your divorce proceedings.
A Few Options
- If divorce isn't an option for you yet but you want to protect yourself, change your joint account to a "Mary and Joe" designation, or otherwise set up rules with the bank to require both signatures for withdrawal. You may need your spouse's cooperation for this, however.
- If you haven't already signed up for Internet access to your bank account, do so. This won't stop your spouse from taking the money if your account is held by "Mary or Joe," but at least you'll know immediately if she withdrawals the balance. You might be able to prevent an avalanche of returned checks and overdraft fees.
- Put just enough money in the joint account to meet household bills. If there's anything extra in your paycheck, stash that money in an account in your sole name.