How may I withdraw funds from a shared account during a divorce?

On Behalf of | Nov 17, 2021 | Divorce

Shared or joint financial accounts opened during a marriage generally belong to both spouses. As noted by Bankrate.com, before withdrawing your portion, a divorce may require you to include joint accounts with your marital property.

During a Colorado divorce, your assets become part of your marital estate unless you have a prenuptial agreement. The court requires dividing an estate fairly between you and your spouse. If you remove money from a shared account, you could still owe a portion of it to your marital estate.

Agreeing to close accounts

Some couples discuss closing joint accounts before filing for their divorce. They may, for example, agree to split the balance or use it to pay off household expenses. If you have bills paid automatically from a shared account, you and your spouse could work out a mutual agreement to close it. The terms of your agreement could outline which spouse then takes over the closed account’s automatic payments.

Divorce also involves dividing debts. Many creditors require consent from both account owners before closing a joint account. According to Experian.com, both individuals could still face liability for any remaining balances. Creditors may pursue both account owners if one fails to make future payments.

Prohibiting changes after filing

As reported by The Ascent, after filing for divorce the court issues an injunction that prevents making changes to shared accounts. If you liquidate any stocks, for example, the court may find that you owe your marital estate part of the proceeds.

Without an existing agreement, the court might find you in contempt for using a shared account. You may avoid raising unnecessary legal issues by negotiating a division of your assets before filing for your divorce. Amicably negotiated agreements could help reduce the time it takes to dissolve your marriage.