Some millennials trying to avoid property division in divorce here in Carlsbad may be in for a surprise. A recent Bank of America survey concluded many millennials are electing not to open joint accounts with their new spouse after marriage. The Bank of America study shows 28% of newly married couples are maintaining separate checking and savings accounts from their new spouse. This is twice as high as the 13% of newlyweds who did so in the previous generation according to the survey.
In addition to the 28% who kept separate accounts entirely, many more couples set up “mine, yours and ours” savings and checking accounts. These strategies are rooted in the idea that the funds in their separate account will remain “separate” property in the case of a divorce. This simply isn’t the case in California, unless you enter into a prenuptial agreement.
The surprise for Millennials trying to avoid property division in divorce is the fact that California is a community property state. Community property is to be divided equally between the parties at the time of divorce. This includes all debts and assets obtained by the couple during the marriage – even if they have maintained separate accounts. Income is considered community property in the absence of a prenuptial agreement.
Even worse, these couples may be surprised to learn not only is their separate account strategy (without a prenup) not going to work, the cost of litigating the matter actually consumes even more of their money.
Millennials trying to avoid property division in divorce should contact the Certified Family Law Specialists at Burke & Domercq to discuss a prenuptial agreement. Prenuptial agreements allow you to enter into an agreement prior to the marriage which can protect and preserve the separate property you wish to establish. If you have recently married and are surprised by this blog, you may still be able to rectify the situation. Print the most recent statements for each individual account in the 3 months immediately prior to the wedding, and contact us or call 760-434-3330 to schedule an appointment to discuss an ante-nuptial agreement. (ante-nuptial simply means “post nuptial” or after the wedding).
If you are approaching a divorce, the trial attorneys at Burke and Domercq can work to show the Court our clients have contributed more financially during the course of a marriage and therefore awarding a larger percentage of community property (bank accounts) is actually more equitable under California law. The circumstances of each case are unique. However, with a little planning, these issues in divorce can be avoided all together.