Baby boomers in Arizona and elsewhere may have been reluctant to maintain separate bank accounts and assets while married, but millennials appear to see things differently. As reported by CNBC, more than a quarter of millennials have decided to refrain from setting up joint accounts after getting married. The reluctance may be based on the number of millennials who have seen for themselves how their parents fared during a divorce when comingled finances complicated the assets division.
Although separate accounts and a “mine, yours and ours” approach may reduce conflicts during the life of a marriage or its dissolution, it might not be the hoped-for iron-clad arbiter of asset division. Residents of community property states, such as Arizona, may discover that the contents of separate accounts might not be as separate as they thought.
Failing to protect assets with separate bank accounts
A soon-to-be ex-spouse’s attorney may successfully argue that any properties and financial assets acquired during the marriage are “marital property.” That makes them dividable, and a judge is not required to make it a 50-50 split. Dividing the assets “fairly” does not necessarily mean “equally.” Property claimed to be separate may instead serve to add funds to a settlement that a judge decides is fair.
Planning ahead with a mutually agreed-upon prenup
A prenup may be the best option for keeping assets separate in a community property state. They are becoming a popular option among millennials. A prenup also gets couples talking about their finances. Mutual understandings and transparency during the planning stages of a marriage may help reduce or eliminate acrimonious feelings developing during a possible future dissolution.
Discovering hidden assets
Even with the best intentions, attitudes and perspectives may change over the years and a couple may begin to drift into more turbulent waters. As noted in Forbes magazine, it may be necessary to conduct some detective work and discover if a spouse has been accumulating hidden assets. Finding out about hidden assets could make a significant difference in a spouse receiving fair treatment in a divorce settlement, especially if suspicions and mistrust have developed over the course of a marriage.