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| Advisors' Forum |
The Chips Are Down
03/01/2008
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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.
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