Divorce & Individual Savings Account

Preparing for divorce necessitates that you understand some basic laws pertaining to assets and how this property potentially may be divided between you and your spouse in divorce proceedings. By garnering this basic understanding, you put yourself in the best possible position to make informed decisions during the course of your divorce proceedings.

Ownership

Technically speaking, an individual savings account is owned only by the person whose name is on the account. With that noted, divorce laws in all states potentially can trump the basic statutes governing who allegedly owns a bank account based on how it is titled, according to "The Complete Divorce Handbook: A Practical Guide" by Brette McWhorter Sember.

Types of Property Division

In the United States, there are two general types of law governing the manner in which property is divided between a husband and wife in divorce proceedings, according to Cornell University Law School. First, in a community property state, property gained by a couple during the course of a marriage is divided equally between them. Second, in a state that uses equitable division practices, a court determines how marital assets are divided between the spouses based on what is fair in a particular case. Equitable division of property does not use a black and white standard; furthermore, property division is based on the specific facts of an individual case.

Considerations

The key consideration in determining the in which an individual savings account is handled in a divorce case is when and how the money in the account was obtained. If the money in the account consists of wages earned by the spouse who opened the account during the course of the marriage, this money is considered marital property and is subject to division. However, if one of the spouses brought the money into the marriage and placed it in a segregated, individual account, the cash is not likely considered a marital asset and will be set aside for the spouse who earned the money before the start of the marriage.

Misconceptions

A common misconception associated with determining which spouse gets what property during the course of a marriage is that an individual bank account protects the wages earned exclusively by the spouse who opens the account from the other party to the marriage. The manner in which the cash is preserved and maintained is not the issue. The issue remains when and how the money was earned.

Expert Assistance

Division of assets represents one of the most emotionally challenging and legally complex issues in divorce proceedings. Finding yourself facing a divorce, including one that likely will involve disputes over property issues, suggests that your best interests are served by hiring an attorney. The American Bar Association maintains consumer resources to assist people in your position in finding capable legal representation.