We’ve always had separate accounts – so we’re good, right?

Posted on Dec 2, 2022 by Katie Carter


I’m always surprised at just how many people maintain separate bank accounts throughout the entirety of their marriage. Though I definitely understand the desire to keep things separate – and maybe to share expenses in a mutually owned household account – I do think that it often causes confusion about what is marital property and what is separate in the event of a divorce.

You see, just keeping accounts separate doesn’t mean that the money in the accounts is yours. Only having one name on a credit card doesn’t mean that the debt attaches to only one spouse.

Under Virginia law, anything earned, purchased, or acquired during the marriage – regardless of title – is a marital asset (or, in the case of debt, a liability).

What’s separate is anything that you earned, purchased, or acquired PRIOR to the marriage, or anything that you were given or inherited by someone other than your spouse, whether before, during, or after your marriage.

Carefully keeping these accounts separate, and not commingling funds, is not the thing that will prove to a court that your accounts are truly separate.

I agree that, in some cases, this does seem unfair. If one of you is a spender and one of you is a saver, but you both have roughly equal incomes, well, there is a sort of logic to the argument that you’ll each keep your own. But, you see, that’s kind of opposite of the entire principle of marriage, which is that the two of you are partners under the law.

The way the law – and judges – look at a marriage, you’re like business partners. The family is the business. And, for better or for worse, you’re in it together. So, the debt of one of you is the debt of both of you. The bank account of one of you is the bank account of both of you. It all sort of goes into a pot and is divided under equitable distribution.

Dividing things up and ‘each keeping their own’ is generally not what happens in a divorce. Often, in a separation agreement, we’re able to get the parties to agree to this, especially if they’ve had separate accounts. But it’s not a guarantee, and it’s not how the law works.

Think about it this way. In many cases, there’s a significant disparity in income. One spouse may work a whole lot more – or be dramatically more highly paid – than another. The parties may come together and decide that one of them should stay at home to raise their children. It’s a sacrifice, of course, but a mutual one, agreed upon by the parties, to ensure that their children have the best possible upbringing in life.
Maybe one party travels, so the other party has to be closer to home. One party works long hours, so the other has to be available to meet the needs of the various family members, take care of the home, and take care of other things necessary to keep everything running smoothly.
It’s kind of…opposite…of the principles of marriage to have a higher earning spouse carefully stashing away money, carefully titling things in his name only, in an effort to keep those things away from his spouse. The way the law operates, its designed to operate as a protection, to keep both parties honest, to keep them responsible for their roles as partners in the business of marriage.

So, just because you have accounts, and they’re separately owned, doesn’t mean that your ‘separate’ account is separate for the purposes of the division of your assets in a divorce. Maybe, in your case, your soon to be ex will agree to keep things separate – but, then again, maybe he won’t.

I can definitely see how, in the context of a saver and a spender where most of the other things in the marriage are roughly equal, it would seem like this is an unfair policy. I can certainly understand, if you’ve been responsible while your husband was less so (and, heck, maybe that’s even a big part of the reason for the divorce) it would feel unfair that you were then asked to divide those accounts.

Divorce often feels unfair, after all. The way judges and attorneys look at it, we’re looking at what’s ‘equitable’, so a lot of people think that we’re looking at fairness. But fairness is, ultimately, kind of hard to quantify. It’s subjective. And what feels fair to one person feels literally entirely the opposite to another. So, it’s hard to have reasonable expectations if you go into a divorce expecting fairness.

Mostly, we look at what’s there – assets and liabilities, earned during the marriage – and we put them in a pot. We don’t necessarily divide everything 50/50, but a lot of things turn out roughly 50/50. Things like the marital home and the retirement accounts are divided predictably. Bank accounts, usually, are divided – or, at least, the marital portion is.

The areas where there’s room for interpretation are child custody and visitation, and spousal support. Beyond that, though, we classify property as either separate, marital, or hybrid, and divide.

I’m sorry if this isn’t the answer that you want to hear, and I can certainly understand if it feels unfair. I can’t speak perfectly to a unique set of circumstances, so I also definitely advise you that if you want to double check, or see how these rules apply to your situation, to sit one on one with an attorney and have a conversation about your specific concerns and how to address them.

Ultimately, though, once you’re married, whether you mix the accounts or not, things become marital in nature. A lot of that is designed to protect lesser earning, less powerful spouses. Marriage itself is designed to be a protection. You earn an interest in his retirement accounts without working at his job, you have an interest in the equity in the home even if your name isn’t on the deed or the mortgage (assuming it was purchased during the marriage and paid for, at least in part, with marital money).

Keeping things separate – on its own – is not enough to ensure that the assets you’ve accumulated are yours alone, or to avoid your share of the marital debt.

There may be other factors that contribute, and could potentially result in the judge awarding one party more or less of the assets or debt (that’s one of the main principles of equitable distribution after all; that monetary and non monetary contributions to the marriage matter in terms of division). But just the simple fact that you’ve kept your accounts in your own separate names is not enough, by itself.

For more information or to schedule a consultation with one of our attorneys to discuss your situation, give our office a call at 757-425-5200.