Establishing an "exit" fund


#1

I’ve read on other forums that people squirrel away money as an “exit” fund. Some legal columns in magazines I’ve read have recommended that you have some savings of your own in case you need it when you separate. But in North Carolina, wouldn’t opening an account on my own still be considered “community” property and have to be reported on a financial statement? What if my mother were to open a savings account with me as a co-signer? Would that be considered community property since she is not a party to the marriage?


#2

Any money saved during the marriage is marital property and will be accounted for in a final distribution of property. If your mother opens a savings account any money that you put in the account is still marital property


#3

I realize that not all states work on the 50/50 ED model so what the magazines recommend may not pertain to NC, but if you were trying to collect some money to live on while waiting for an equitable distribution, how could you do that in NC? I cannot leave my abusive marriage if I have no money to put down deposits on an apt. and utilities.


#4

You may save money to facilitate your exit, but those funds will be accounted for in a final distribution, meaning if you take 10k, you may receive 5k less of another asset when all property is divided.


#5

^ i agree. i had to go through that with me and my ex-wife. everything is divided in the middle. in some cases, in which you don’t have a job during the marriage, court can grant the acquired assets to your wife since you brought nothing in.


#6

I’m assuming that when the judge orders ED it is based on what exists at that time. In other words, if you save 10k for an exit fund and then physically exit, using 5k of your fund for deposits, etc., there will only be 5k left to divide when the judge hears the case. If at that time, you are dividing a property worth 100k, that 5k will be figured in, so that you will each walk away with 52.5k. Am I correct in this assumption?

New questions, #1: what about assets and debts acquired after physical separation but before the final divorce judgment? Are these figured into ED?

#2: what about assets acquired before physical separation that were “gifted” to family members after separation but before the final divorce judgment? Can these be figured into ED? How can these “gifts” be proven?


#7

The entire 10k is divisible. If only 5k is left and there are no other assets to make up for it, the other party will be entitled to the entire 5k.

If the remainder of the martial estate is 100k, then you are dividing 110k and each party in an equal distribution, would receive 55k.

Property acquired after the date of separation (with non-martial funds) are the separate property of the spouse who acquires the property.

Gifts received from family members are the separate property of the spouse who receives the same, so long as the gift was not clearly made to both parties (wedding gifts are an example).