Divorce can be devastating financially as incomes are split, property is sold at a loss and the financial burden of single parenting takes effect. For this reason, the financial toll must always be considered when couples are considering a divorce. According to a recent article on findings by the Census Bureau, a study over a period of 15 years showed that couples who remained married during that time built up nearly twice the net worth of people who remained single. Considering the visible toll on finances caused by divorce and the findings by the Census Bureau, a stark picture is painted for those that end their marriages. Of course, situations differ among couples and a thorough evaluation of your finances is a critical component in understanding the pros and cons of divorce and reconciliation.
Posts Tagged ‘Financial Security’
Marriage and Money
Thursday, August 19th, 2010Prenuptial Agreements – Planning to Avoid a Fight
Thursday, July 8th, 2010A very important, but often overlooked, tool in avoiding nasty divorces is a thorough prenuptial agreement. Here is an excellent article on the need for prenuptial agreements in estate planning but it is just as applicable in the divorce context.
The Money Grab
Monday, October 5th, 2009It is nearly impossible to read the news and not see something about Jon and Kate Gosselin, their divorce and their television show, Jon and Kate Plus 8. The television show follows the Gosselins as they raise sextuplets. While you cannot help but feel bad for the children as their publicity-hungry parents divorce in the public eye, it is nevertheless interesting from a divorce perspective to see how the dissolution of a marriage in the public spotlight mirrors those of people who quietly divorce without publicity - all are driven at some level by self preservation, the need for security, the need to “win” and greed.
One of the headlines today is “Kate Accuses Jon of Taking $200,000.” Apparently, Jon and Kate maintained over $200,000 in a joint account and after being notified that he would no longer be part of the show, Jon withdrew all but $1,000 of the money. Perhaps Jon had a good reason for the withdrawal, but his “reason” had the effect of leaving his spouse and children with very little to make ends meet.
When two people separate and anticipate divorce, it is natural to be wary of the other’s intentions and to be mindful of your own financial security, especially when children are involved. However, it is important to remember that in Mississippi, when money is withdrawn from an account held jointly with your spouse, that the money also belongs to your spouse. This does not mean withdrawing money is improper (unless a court has prohibited any withdrawals), but you may ultimately have to account for the money if a court decides that you overreached and withdrew more than your share of the marital funds. In the Gosselin matter, Kate withdrew $100,000 earlier this year and was ordered to return the money. Now that Jon has done the same thing, it is hard to imagine a court not ordering him to return some or all of the funds to his wife, especially considering she is now raising their eight children alone.
When withdrawing funds from a jointly held account while a divorce is pending, it is important to be reasonable and know that you may be ordered to return all or some of the money, even if it has been spent. While winning the race to the bank may be beneficial, the benefit may only be temporary.