Many divorces result in both spouses wondering whether the other spouse took advantage of them. The simple fact is that most of these divorces end up reversing the economic benefits of marriage. Instead of two people (and possibly two incomes) supporting one household, a divorce results in having to support two separate households.
But what if one spouse is actually taking advantage of the other? What if there is financial abuse involved? Unfortunately, this scenario is far more likely to happen to women than it is to men, for several reasons.
If you’re wondering, “Can my husband legally withhold money from me,” then you’ve probably got a lot of well-founded concerns to consider. This article will not answer every question in detail, nor will it provide legal advice for your situation.
This article’s intent is to help frame some of the issues surrounding this situation so you can determine what your next steps should look like.
“Can my husband legally withhold money from me?”
To provide a short answer to this question, “It depends.” What does the answer depend on? It depends on several factors:
- Is your husband able to claim this property as separate property?
- Do you have any legal rights to this money?
- What state do you live in?
But the more important questions probably look like:
- What do my options look like in this situation?
- How do I take care of myself?
- What else is going on, that I don’t know about?
- What is going to happen to me or my children?
In other words, if you’re asking this question, it’s probably a symptom of much bigger problems. Let’s take a look at why this might be more likely to happen to women than to men.
Why this could happen to women more often than men
There aren’t really reliable statistics to indicate whether women are more likely to be victims of financial abuse than men in a marriage. However, anecdotal evidence shows that the phrase:
“Can my husband legally withhold money from me”
appears in Google searches significantly more than:
“Can my wife legally withhold money from me?”
Here are 5 indications why this might be true. Again, they are not backed by empirical evidence. Furthermore, your personal experience may be different.
1. Financial abuse in a marriage is a form of domestic violence and is highly correlated to domestic abuse.
According to the National Coalition Against Domestic Violence, between 94% and 99% of domestic violence survivors have also encountered financial abuse, or economic abuse. And women are more likely to experience domestic violence in all forms, than men.
2. Men are more likely to ‘handle the financial planning’ in a marriage.
According to a 2019 study conducted by UBS Global Management, 58% of high net worth (HNW) women defer their long-term financial decisions to their spouses. The study also showed:
- 85% of women handle day-to-day planning, while only 23% handle the long-term planning.
- The top three needs that women are most likely to identify are:
- Retirement planning
- Long-term care
- 76% of widows wish they were more involved in financial planning during their marriage, indicating that these top three issues likely were not covered by their husbands.
- Millennial women were more likely to be financially vulnerable than older women
In other words, the decisions that cause widows to live in poverty after their husbands pass away are similar to the decisions that enable wives to be vulnerable to economic abuse. In either case, these decisions directly lead to serious financial consequences.
And part of that is because they’re more likely to trust men to handle the money so they can focus on other things.
3. Women are more likely to be trusting about the finances and focus on things that are not financially related.
This isn’t a universally accepted fact. But as a financial planner, the vast majority of my client relationships were ones where the man handled most of the financial matters, outside paying the bills. Why?
Because in those households, the woman generally:
- Raised the children
- Maintained the household
- Focused on balancing their career with their household duties
In other words, many of the things that have come to define the stereotypical marriage between a man and a woman. This wasn’t true in EVERY case, but often enough for the stereotype to make sense.
In some cases, the women were simply busy and overwhelmed. In others, the husband had a high level of interest in making money decisions, especially investment decisions. And in others, the women simply did not care to know the details.
4. Men are more likely to be interested in the topic of money than women.
I’ve met financial planners who have established entire practices around this observation. And breaking through in ways to make financial planning more attractive to women.
But the simple fact is that men are overwhelmingly more likely to be interested in money than women. Look at the financial services industry, which is still dominated by men, despite years of effort to make it more enticing for women to join.
5. Men are still more likely to be the bread winner in a one-income family.
According to recent U.S. census data, 46.6% of opposite-sex married couples were dual income families where the husband and wife worked outside the home. But in one-income families, husbands were much more likely to work outside the home (18.2% of families) than wives (7.2%).
Now that we’ve covered some background one WHY financial abuse in a marriage might happen more often to women, let’s bring this back to the question of whether your husband can withhold money from you.
And the most important question to consider is: “Is the money considered marital property or is it separate property?”
Marital property vs. separate property
As a general rule, marital property is property or assets that was acquired or shared with the other spouse after the couple was married. Conversely, separate property is property that one spouse either brought into the marriage or acquired through some means outside the marriage (such as an inheritance).
Example of marital property
Marital property is considered property that both spouses can reasonably lay claim to in a divorce case. This ends up in an equitable distribution of marital assets, as agreed to by both spouses in the divorce settlement.
An example of marital property would be a joint bank account that was opened in the married couple’s name and funded by paychecks both spouses earned during their marriage.
Example of separate property
Separate property is property that the other spouse cannot claim in a divorce. Separate property is normally excluded from discussion during divorce proceedings.
An example of separate property might be a $100,000 life insurance policy that one spouse inherited from a deceased relative. They established a bank account in their own name and never gave the other spouse any reasonable indication that they would bring that money into the marriage.
Likely arguments over property
In situations where one spouse is withholding financial resources from another, it might be very blatant. This would be a clear example of financial abuse, which we’ll discuss in a later section.
More likely, there will be a dispute over whether the property is actually marital property (and the dependent spouse may have a legal claim to part of it), or whether it’s separate property.
While state law may dictate what is marital property and what is not, below might be some justifications or reasons that the withholding spouse mentions. There is no right or wrong answer here, because each situation might warrant a different outcome.
Reason #1: I earned this money, therefore, it’s mine.
In most cases, this is a justification for financial abuse. In generally, this sounds like something that the primary earner says to the dependent spouse as an intimidation method. And because the abused spouse is so dependent for financial support, they remain intimidated.
But in some cases, it might not be so clear. So that’s when you need to hire a financial advisor who specializes in divorce planning to help.
Reason #2: I had this money before we got married, so it’s mine.
This may be a valid argument, as money brought into a marriage remains separate property as long as it is not commingled. Commingling is when one spouse voluntarily adds separate property to marital property, making it indistinguishable.
The most common example of commingling is when a spouse decides to transfer money from a separate bank account into a joint account. Once this happens, it becomes harder to justify the argument of separate property.
The longer a marriage lasts, the less likely this is to be a valid argument.
Reason #3: I inherited this money from a family member, and it wasn’t intended for you.
This could very well be a legitimate argument for the separate property argument, as long as it was never commingled with marital property.
Reason #4: This money is in a separate bank account, in my name only.
Naming or owning a separate account from your spouse does not make the assets in that account separate property.
For example, a couple is married for 10 years. Husband has been squirreling away part of his paychecks in a hidden account in his name only. Wife has sacrificed her career to support the family and raise their children.
The husband cannot justify his separate account, since it was funded with money that was earned during their marriage. This makes it marital property, despite the type of account it’s in.
In other words, separate property is defined by the origin of said asset, not by the disposition.
Reason #5: I earned this money after we separated, and decided to start keeping our finances separate.
This may (or may not) be valid. When a couple separates, each spouse is usually better off establishing and maintaining a separate bank account during the separation period.
However, this statement and the supporting facts should be evaluated in accordance with the terms of any separation agreement, support agreement, and the terms of the final divorce decree.
Community property states vs. equitable distribution states
To further muddy the issue about separate versus marital property, differences in state law may determine the division of assets in a divorce.
In most states, divorce will result in an equitable distribution of marital assets. This doesn’t mean that everything is split equally. Rather, each spouse may receive an ‘equitable’ portion of the assets, based upon their circumstances and what is negotiated during the divorce proceedings.
In equitable distribution, there may be legitimate reasons for treating some assets differently from others. For example, one spouse may decide to keep the house after the divorce, in exchange for the other spouse keeping more assets in a larger retirement account.
In community property states, all marital property is split down the middle, 50/50. This is regardless of what type of property it is. There are nine community property states:
- New Mexico
Generally speaking, separate property is not included in the 50/50 split of assets.
Having covered the two main considerations for dividing assets in a divorce, let’s shift focus to the possibility that your husband IS illegally withholding money from you. That is considered financial abuse, or economic abuse.
What is financial abuse?
According to the National Network to End Domestic Violence, financial abuse is:
“behavior that seeks to control a person’s ability to acquire, use, or maintain economic resources, and threatens their self-sufficiency and financial autonomy.”NNEDV Financial Abuse Fact Sheet
In other words, financial abuse occurs when one spouse prevents the other spouse from being able to make their own financial decisions, or restricts their ability to exist without depending on the abuser.
Why financial abuse is important to recognize
Many people dismiss financial abuse as a form of domestic violence because there isn’t an apparent crime. At least, not one that victims would feel comfortable reporting. But it’s well understood that financial abuse is a form of domestic violence, even if the victim isn’t a victim of physical violence.
The fact remains that financial abuse usually exists in tandem with other behaviors associated with domestic violence. And forcing a victim to remain economically dependent allows the abuser to maintain (or accelerate) their violent behavior.
But sometimes, it’s difficult to understand whether you’re dealing with the stress of a marriage in trouble, or whether you’re actually a victim. Let’s look at some of the classic signs of financial abuse.
Signs of financial abuse
Financial abuse can be broken down into several types of behavior, all of which conspire to reduce the victim’s independence and maintain financial control over the victim.
This is when the victim is restricted from working outside the home, or even performing remote work within the home. Not only does this prevent the victim from earning much money, it blocks off another social avenue for friends, family, or coworkers to notice signs of abuse. Here are some signs of employment-related abuse:
- Sabotaging employment opportunities, like job interviews
- Stalking the victim while at work
- Preventing access to resources to allow the victim to find a job
- Demanding that the victim stop working or stop searching for work
This can also work in the opposite direction. Many abusers force the victim to work to earn family money. Here are some examples:
- Refusing to work, which puts pressure on the victim to earn more money
- Refusing to pay child support or spousal support
- Directing the victim to work more hours or take a second job
- Telling the victim what jobs to seek out
Forcing the victim into unwanted debt
An abuser can increase a victim’s dependence by forcing the victim into debt that the victim cannot realistically pay under the given circumstances. This is similar to a tactic used in human trafficking schemes to keep human trafficking victims dependent on their abusers. Here are some signs:
- Opening credit cards in the victim’s name only
- Identity theft, or using the victim’s personal information, such as their Social Security Number, without their knowledge or consent.
- Forcing a victim to take out loans or sign financial documents
- Refinancing a mortgage or car loan without the victim’s knowledge
- Use of physical violence or coercion to force the victim to make credit-related decisions against their will
Restricting or preventing access to funds
Restricting a victim’s access to money enables the abuser to maintain a strong hold on the victim. Here are some signs of this form of financial abuse:
- Controlling all financial decisions or withholding financial information, such as financial statements or bank statements, from the victim
- Giving the victim an ‘allowance’
- Using joint accounts to spend large amounts of money
- Prohibiting the spouse from being involved in any banking or investment decisions
- Manipulating the spouse’s benefits, like Social Security benefits or a pension
- Forcing the victim to give the abuser money
- Titling assets or demanding that the victim retitle assets, such as real estate or investment accounts, in the abuser’s name
- Hiding assets
- Demanding justifications every time the victim spends nominal amounts of money
Most of these signs are a far cry from the financial problems that a married couple face, even if their marriage is on the rocks. If this is happening to you, the best thing you can do is take action. Let’s look at what steps you should consider.
Steps to consider
The best thing a victim can do is to get help as soon as possible, especially if you’re in imminent danger.
In a crisis situation, the most important thing is the victim’s immediate safety, and the safety of any children involved. There are myriad support services available, such as the National Domestic Violence Hotline. Their toll-free telephone number is: 1-800-799-SAFE . Once you’re physically away from your abuser, these networks have resources and connections with divorce attorneys, state agencies, and child support services to help you determine the next course of action.
If you’re not in an emergent situation, here are some steps to consider:
- Open your own bank account.
- Close your joint credit cards. Maintain a credit card in your name only.
- Check your credit history to ensure you are aware of all open accounts.
- Talk to a family law attorney. If you cannot afford to pay for a divorce, ask for a referral to pro bono legal help in your area.
- Make copies of all important documents. In the case a financial planner or a forensic accountant get involved, this paperwork will help them get started. This would include:
- Open your own PO box.
- Change all passwords to your online accounts.
After retiring from a 24-year career as a Naval officer in 2017, Forrest became a financial planner to help people achieve success in managing their personal finances. In 2022, he sold his partnership stake in his financial planning firm to focus on helping people full-time through his writing.
Featured in: Forrest’s writing has been featured in the following publications: Forbes, Military.com, NerdWallet, Yahoo Finance, The Military Guide, The Military Wallet, Christian Science Monitor, and many other publications.
If you have questions about the content, please feel free to reach out via email.