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Infidelity often sparks marital trouble. But there’s more than one kind of infidelity that can tear couples apart. “Financial infidelity” is a breach of trust so significant that many relationships struggle to recover.
Imagine working 60 grueling hours a week to keep your family financially afloat, only to discover your husband, who’s on disability, has secretly loaned over $11,000 from your joint bank account to his parents.
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This isn’t just a minor disagreement over spending habits. But is it an overreaction to close your joint bank account? And if you do, how do you ensure it’s the right step, legally and emotionally?
What is ‘financial infidelity’?
Financial infidelity happens when one partner hides or mismanages money in ways that jeopardize the couple’s shared finances. It’s not just about large sums — it’s about the secrecy and disregard for the other partner’s consent.
The husband’s actions in this scenario qualify as financial infidelity. He bypassed a shared understanding of their finances to make a major financial decision on his own, ignoring the impact on his partner.
Research underscores how important transparency is in managing joint finances. A 2023 study published in the Journal of Consumer Research [1] found that couples with merged accounts generally experience stronger relationships.
But if one side begins making unilateral decisions, fissures can develop that leave the wronged partner feeling vulnerable.
Read more: US car insurance costs have surged 50% from 2020 to 2024 — this simple 2-minute check could put hundreds back in your pocket
Closing a joint account: Can you, and should you?
The idea of closing the joint bank account might feel like reclaiming control, but is it legally possible?
The short answer is yes, though the details depend on the account terms. Most joint accounts allow either party to make transactions independently, including withdrawing funds or even closing the account. However, some banks require both parties to consent before an account can be closed, particularly if the account is in good standing and has a significant balance.
If your partner disagrees with the closure, the process gets more complicated. The first step is to review the account agreement to determine whether both signatures are required. If the bank permits one-party closures, the wife could withdraw her share of the balance and request the account’s closure without her husband’s approval.
But doing so could escalate tension without addressing the underlying issues.
A direct conversation — or mediation — might be necessary for accounts where mutual consent is required. Shutting down shared finances isn’t a decision to be made lightly, and it should come with clear plans for how both partners will manage their money moving forward.
Is separating finances the right move?
In the short term, closing the joint account could provide the wife with a sense of security and control over her earnings. In the long term, it could further divide the partnership and make shared expenses harder to manage.
She can consider other options like establishing clear boundaries around discretionary spending, setting up a household budget or opening separate personal accounts while maintaining one for shared expenses. A couples’ therapist or financial advisor could help mediate this discussion to create a framework for better communication around money.
When it comes to managing that money itself, Advisor.com could help this couple establish a plan for their money going forward, including setting boundaries around their shared resources.
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If the husband’s actions represent a deeper pattern, separating finances might be necessary for the wife’s financial and emotional well-being. Seeking legal advice is on the table, too, especially if significant debt or other liabilities are involved.
If divorce is a concern, make sure to look up whether your state is covered by “equitable division” or “community property” laws.
All told, 41 states use equitable division rules in divorce proceedings, meaning that all assets, earnings, personal property and debts are split fairly based on a judge’s discretion — although not always evenly, according to Justia.com [2].
In the remaining nine states community property rules apply instead. Typically, this means that the presiding judge will determine whether assets, personal property or debts are classified as shared or personal property. From here, shared assets and debt are split, while anything identified as personal will only apply to that partner.
In general, this means that it’s harder to separate debt in community property states compared to equitable division states.
Moving forward
If the wife decides to close the joint account, the steps are straightforward but require careful planning.
First, she should open a new personal account to ensure her income is deposited somewhere safe. Next, she must transfer automatic payments and direct deposits to her new account to avoid disruptions in essential expenses.
If you are also looking to open a new bank account, Wealthfront’s cash account offers a reliable and safe high-yield savings plan with full access to your money at all times. Wealthfront’s cash account offers an APY of 4.00%, or about ten times the national average.
With fast (and free) transfers to internal Wealthfront investing accounts, as well as external accounts, it gives you both flexibility and growth potential for your money.
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If their joint account has any remaining funds, negotiating how to divide them fairly could prevent further conflict. Parking these funds immediately to generate a little bit of extra interest could be a good idea while sorting out the details of a new financial relationship.
Create a financial cushion
For many married couples, the idea of maintaining separate emergency funds seems unnecessary. However, this situation illustrates the importance of having resources of your own, whether you choose to use them to help your family, or you need them because your relationship is ending. Creating a financial cushion for yourself is key, but many people struggle to find room in their budget for additional savings beyond their retirement fund.
If you’d like to start your own emergency fund for this scenario, consider opening an account with Acorns. Their platform automates investing and saving to simplify the process of setting aside extra funds.
Acorns automatically rounds up the price of each of your purchases to the nearest dollar and deposits the difference into a smart investment portfolio. This is an easy way to grow your wealth on autopilot, and allows you to start small and grow steadily.
If you sign up with a recurring monthly contribution Acorns can give you $20 to get you started.
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[1]. Journal of Consumer Research. “Common Cents: Bank Account Structure and Couples’ Relationship Dynamics”
[2]. Justia. “Community Property vs. Equitable Distribution in Property Division Law”
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.