Should Spouses Combine Finances?

Should spouses combine finances? Some people will readily answer “yes” or “no,” without fully understanding the potential implications of each choice. If you live in a community property state, like Louisiana, it helps to be familiar with the basic legal concepts surrounding what’s known as the community of “acquets and gains.” It’s also important to remember that there are pros and cons to combining finances and keeping them separate.

Example: Spouse 1 had more money than Spouse 2 at the time of marriage, and so elected to have Spouse 2 sign a prenuptial agreement, agreeing to a separate property regime (i.e. opting out of the aforementioned community of acquets and gains). Spouse 2 went on to found a multi-million dollar business. Upon divorce, Spouse 1 was not entitled to any of the value of Spouse 2’s business, because it was separate property. Ouch! Lesson: a separate property regime can “protect” you from losses and gains. Choose wisely.

Want to avoid the pitfalls of making the wrong choice? Talk to an attorney before making a decision.

The PBS program linked below explores this question from a social point of view. Schedule a consultation with your lawyer to discuss the more serious legal implications of combining or not combining your finances with those of your spouse.

https://www.pbs.org/video/should-you-combine-finances-tcwyik/