Joint Bank Accounts During A Breakup: What You Should Know (2024)

Joint bank accounts can be a convenient way to share expenses with a significant other. By pooling your finances into a joint checking or savings account, you can simplify your shared finances and work together toward mutual goals. But what happens to your joint accounts if the relationship doesn’t last? It’s not always pretty.

When Audra and her partner split up, her ex made some financial decisions with their joint account without consulting her. “My ex and I had everything jointly. I even worked for his business and we had a business account and one joint account at the bank,” explains Audra, who asked that her last name not be used . “But one day after we broke up, I was taken off the business account and he emptied the joint account.”

Audra’s story is a common one, according to Wendy Althen, founder and owner of Althen Financial Solutions, LLC in Milwaukee. “Money is one of the No. 1 reasons for divorce, and if it’s already a source of contention, that can lead to a partner emptying an account or using money as a bargaining chip,” Althen says.

However, there are a number of ways that joint account holders can protect themselves and their finances in case of a breakup. Here’s what you need to know about what happens to joint accounts when the account holders separate.

The Breakup Risk for Joint Accounts

What makes a joint account convenient for a cohabiting couple (or any two individuals with a shared financial interest) is the fact that both account holders have equal access to the funds within the account. Both account holders can set up direct deposit, use debit and ATM cards and make withdrawals whenever they like. Presumably, a person you trust enough to open a joint account with is someone who will never abuse this access to joint money.

The problem often arises when the relationship goes south, especially when it feels like the split comes out of the blue, according to Althen. “Once there’s a separation,” Althen explains, “people do weird things with money.”

Under such circ*mstances, an angry or upset partner could empty or overdraw an account without their ex’s knowledge. And since both account holders are equally responsible for all account activity, including bounced checks or overdrafts, this could leave the unwitting partner facing some serious financial complications.

This is what happened to Audra when her partner emptied their joint account immediately after their breakup. “I had an account that my partner didn’t know about,” she says. “I wish I had thought to move some of the money from the joint account into my solo account—at least enough to get me started. I was left with basically nothing.”

Divorce Offers Greater Protection

Joint bank accounts are typically shared by married couples, although domestic partners, adult parents and adult children, business partners and other types of relationships may also choose to open a shared account. But divorce generally offers the best protections to joint account holders who find their relationships souring.

That’s because money in a joint account owned by a married couple is considered marital property and must be split according to state laws. “There’s generally a paper trail with joint accounts,” Althen explains. “Even if a spouse decides to empty an account, bank statements will make it clear what was in the account at the time of the divorce, and the one emptying the account will owe the other spouse half of what was taken.”

That said, there are some options available to non-married joint account holders, such as freezing the account if you anticipate a contentious breakup. According to Althen, “typically, divorce lawyers will tell a divorcing spouse to freeze any joint accounts so that nothing new is coming in or going out.”

The rules for freezing or placing a hold on a joint account, so that no debits can be made, vary by bank. But generally, freezing a joint account can be done by either account holder, whether or not the couple is married. In some cases, you simply need to contact your bank and request the freeze. Typically, you will have to provide the account number plus answer some identifying questions. Then you will need to follow up with a letter informing the bank that you would like the account to remain frozen until further notice. The bank will hold this letter on record in case of any disputes over the account and its funds.

To lift the freeze, some banks may require that all account holders agree to unfreeze it. Other banks may allow any single account holder to lift the freeze—in this case, it’s possible that you could freeze the account just to have your joint account owner lift the freeze. If this happens and you and your joint account holder place a series of holds and lifts on the account, the bank may restrict usage of the account completely.

What does freezing an account do? “It gives everyone a snapshot of the finances at the time of the breakup,” Althen says. “Once the divorce papers are filed, assets are typically frozen if they haven’t been already, but a freeze makes it clear what was in the account at that specific moment.”

Unfortunately, even having a freeze on the account may not have helped in a case like Audra’s. That’s because splitting up joint property among unmarried cohabiting couples or others in non-marriage relationships is generally up to the individuals rather than codified in law as it is with marital property in a divorce. Disputes over property between unmarried joint account holders are generally handled through the business-related state civil courts, rather than via mediation, family court or with expedited hearings, which divorcing couples typically have access to.

Keeping a Joint Account Post-Breakup

Even with all the potential headaches of a joint account during a breakup, some couples decide to keep their joint account even after their relationship has ended. For co-parenting exes, holding onto a joint bank account can make it easy to manage their children’s expenses.

“When everyone acts like an adult, maintaining a joint account post-divorce can be the simplest and fastest way to handle co-parenting expenses,” Althen says. “Amicably sharing a joint account with an ex can be done. I don’t know if it’s normal or an anomaly, but I’ve seen it work.”

The Importance of Knowing Where the Money Is

Opening a joint bank account with someone is an act of faith—and unfortunately, there is no real, proactive way to make sure your co-account holder doesn’t pull a fast one with your money. This is why Althen recommends that everyone with a joint account should trust, but verify. “Educate yourself on what is going in and out of the account,” she advises. “As long as everyone is aware of what’s happening in the joint account, money is up for discussion between you, and you keep the lines of communication open, a joint account can work for both people.”

That said, it’s wise to tread cautiously with joint accounts. For Audra, her experience gave her new rules for her money: “From now on, I will always have my own bank accounts with my own money,” she explains. “I could see starting a joint account in which we both contribute to rent or food and utilities, but I will never again have all my money in one place where someone else can access it.”