Pros and cons of a secret bank account

Perhaps the two most common regrets of Wisconsin women going through divorce are not having been more involved with the family finances during their marriage and not having maintained control of their own money. Keeping a separate, secret bank account may be one way to take a more active role in one’s finances and avoid regrets during divorce. There are both advantages and disadvantages to this approach, however.

On the plus side, it can be empowering, both financially and emotionally, to have one’s own source of funds. A separate account may alleviate some of the loss that a woman may feel about giving up her career and her financial independence to stay home and raise a family. An additional bonus of a separate account is having funds that a spouse cannot access or control, particularly if there is concern that he or she may clean out joint accounts and use underhanded tactics to run up divorce expenses.

On the other hand, it may be considered a breach of trust to maintain a separate, secret account during marriage. The spouse with the secret account could be accused of hiding assets or dissipating marital funds, which could negatively impact his or her credibility in a divorce proceeding. To avoid such accusations, it is important that the fund include only one’s separate property, such as assets held before marriage or inherited. Also, the fund should be disclosed on one’s financial affidavit during the divorce proceedings.

An experienced family law attorney can help answer any questions about what constitutes marital property and what may be deemed one’s separate property. The attorney can also assist in developing an appropriate strategy for the division of marital assets.

Source: Forbes, “Pros And Cons Of Keeping A Secret Fund In Case You Divorce,” Jeff Landers, Feb. 14, 2013