Many married couples recognise the benefits of creating joint bank accounts: it can make managing the household’s money easier, and it can also make filing taxes easier if the spouses are motivated to do so. Furthermore, having a larger pooled pool of assets to which you and your partner both contribute can lead to better credit and, as a result, lower interest loans and bigger credit limits. Why not try this out Alberta Divorce Finances
However, such bank accounts—and joint funds in general—can be problematic in the event of a divorce. There are numerous questions to be solved, including who gets what, whether or not to sell the house and maybe other assets owned jointly by the spouses, and how to manage joint debt.
If you and your husband are thinking about divorce and have a joint bank account, there are several things you can do to make the process go more smoothly for both of you. One of the first things you should do is obtain a copy of your credit report. This can offer you a better picture of where you stand in the eyes of banks and creditors, which can be helpful when selecting what to do next.
You should consider freezing the joint bank account early on. Although many divorces are amicable, having a joint bank account open makes it possible for one spouse to withdraw all of the funds. If this happens, the court will usually compensate the other spouse for the lost income; regrettably, this can take months or years.
As a result, before you are officially divorced, you should open separate bank accounts for each of you. A joint bank account can also mean a better credit score for both of you, as previously noted. It’s generally possible to arrange more beneficial financial configurations for each of you before the divorce is complete if you have superior credit.
You’ll need to decide how to divide the assets once you’ve opened separate accounts for each of you. Of course, this is a very personal decision that is heavily influenced by your circumstances. Some couples split their assets evenly. If there are children, it may be preferable to distribute the assets in the best interests of the child(ren). Despite the fact that many experts urge joint custody, unilateral custody is still frequent. Child support and alimony payments are frequently associated with sole custody, and should be considered when dividing your assets.
When two spouses own a home together, many experts recommend selling the home and splitting the proceeds. This offers the advantage of more evenly distributing your assets than if one spouse gets the house and the other receives the retirement funds, for example. This is sometimes recommended since the cost of the house may exceed what one spouse can fairly pay. Although it’s easy to develop emotionally connected to a home, selling it may be in both parties’ best interests in the long run.