03/01/2008
I recently discovered that my wife has a gambling problem when I noticed that some of our joint accounts were significantly depleted. When I confronted her, she admitted the problem, but so far she is not willing to seek professional help. I expect that we are going to have a struggle over the situation. Are there legal steps I can take to control our portfolio—which is essentially jointly owned—and protect our finances?
Joint accounts with rights of survivorship are freely accessible by either joint owner. You or your wife may access the funds without authorization by the other party.
You could simply open another account in your own name and transfer the bulk of the funds to your individual account. Once those funds were in your own account, your wife would not have access to them. Yet this obviously raises potential conflict with your wife. You may also face some internal roadblocks from your financial institution, depending on its rules regarding such transfers.
The rules of each state and financial institution may vary, so as always, you should seek the advice of your financial or legal professional.
Domenic DiPiero, Newport Capital Group, Red Bank, N.J.
Your situation presents logistical, as well as highly emotional, challenges—all the more reason I commend you for having the foresight to seek advice regarding your financial protection. Many times, people in these situations wait until it is too late and financial havoc has already ensued.
There are some things you can do now to protect yourself, your family and your wife. First, I would segregate as many liquid assets as possible. Open new accounts in your name alone, then transfer cash and investable assets into them, restricting your wife’s access. (Safeguard your children’s savings and college fund accounts, too.) Suspend automatic deposits into any accounts to which your wife has access. Transfer title to the family home into your name alone, and secure any valuable items your wife may try to pawn. Any assets left in her name should be illiquid or, better yet, put into an irrevocable trust for her benefit. Contact retirement, investment and insurance agents to prohibit removal of funds or loans against these assets.
Second, close revolving credit accounts and joint credit cards, especially those that give the card holder the ability to take cash advances.
Third, carefully monitor your credit report. Your credit rating could be jeopardized by your wife’s activity, and you want to take steps to minimize your risks.
Finally, get support. There are numerous organizations that can
assist and advise you and your family through this difficult time.
Financial protection is only one step in the whole process of
dealing with your wife’s addiction. Consulting a reputable family-law attorney
might be helpful. I’m certainly not suggesting divorce, but talking with experts
in these areas can be extremely helpful when it comes to protecting your assets
and your financial future.
Kathy Kuehl, Lowry Hill, Minneapolis
Because you have a joint account,
your wife would need to sign paperwork to remove her name from the title of the
account. Because she has admitted her problems, this should not be much of an
issue. We would advise you to then title the account in your name only. Once
her name has been removed, only you will have access to the assets.
If you want to go even further, and you prefer that she never
see any statements, then we would suggest two additional steps. First, choose a
new financial advisor to work with—a firm whose staff doesn’t have any ties or
standing relationships with your wife—and invest the money there. Then have the
statements sent to a post office box that you establish, or set up an account
that will email the statements to you.
To further protect your estate should you pass or become
disabled, we would encourage you to work with a competent estate planning
attorney. The attorney will be able to help you change the beneficiaries of
your accounts so that those assets flow into a trust account. That way, your
financial professional, the estate planning attorney and a trust company will
work in your best interests to protect the accounts from being squandered.
The bottom line: With proper planning now, you can protect the
assets both from your wife and for her.
Shane Barber, Barber Financial Group, Lenexa, Kan.
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