Q: We are planning to get separated, but mostly have joint accounts. How do we go about separating our accounts or will divorce automatically take care of it?
A: Separating your accounts is a necessary step if you are planning for a divorce. During the process of divorce, one of you will be given the responsibility of paying the debts. However, since you have joint accounts, from the creditors’ perspective both of you are equally responsible for paying off the debt. So, as long as the balances are unpaid, the creditor would expect payment from either of you irrespective of what the divorce decree is. So, it is a good idea to not keep the joint accounts any longer than what you need to. There have been cases, where one of the spouses has left town after increasing the balances leaving the other partner in deep trouble and debt.
The right step is to talk to the lenders and explain them the situation and request for closing the joint account, followed by opening up of separate accounts if required. There will be assistance available somewhere in the corporate ladder, where you can get assurance for the same, thus solving the problem with the joint account.
