savings account division at divorce

[Harry Yoshida]

What is the name of your state (only U.S. law)? California

Dividing Savings Account Balance at the time of Divorce in California.

I and my wife were married in 1963. We agreed that our date of separation is June, 1978. We are trying to work out property division, and one of the issues is to divide savings account balance.

My wife has been entrusted to manage Savings Account since we got married in 1963. Since we have never thought of getting divorced, she has not kept any of records of deposits or withdrawals except very recent ones.

We tentatively agreed that the savings account balance was about $10,000 in June, 1978 which is agreed upon date of separation.

I suggested that we assume the community property portion is what $10,000 in 1978 would have become now in 2009 if no additional deposits were made since 1978. I suggested that we find out prevailing interest rates of savings account from 1978 to 2009 in calculating the amount of money that original $10,000 would have become.

It turns out that it is a substantial amount of money as far as we are concerned, and she would not agree to my suggestion. She has not come up with any alternative solution yet.

Is there some way based on either statute or legal precedent(s) that we can calculate the community property portion of the present balance of savings account? I guess it has to do with dividing $10,000 plus post-separation passive appreciation (or profit) of the “investment” of $10,000.

 

[mistoffolees]

Why 1978? You got married in 1963. Unless you legally separated in 1978, you are still married and the account is still a marital acccount. That means that anything accumulated since 1963 is marital property. If you end up in court, your verbal agreement to use 1978 won't matter.

If you legally separated in 1978 (if your state even has such a thing which I didn't check), then your separation agreement should have addressed it. Plus, there's the fact that you've mingled so much marital property with the separate (pre-1963) property that it would be impossible to sort it out at this stage, anyway.

I'd simply consider the entire account to be marital. You'll spend far more aggravation, time, and money than it's worth trying to sort it out.

For what it's worth, $10 K in 1978 would be worth $18 K today if there were a 2% annual interest rate. You can probably find online calculators which show the actual rates.

 

[Harry Yoshida]

To: mistoffolees
From: Harry Yoshida

Thank you very much for your answer. It is very helpful already.

The date of separation of June, 1978 was decreed by the Court, although the entire divorce proceeding is not over yet, i.e. Property division not ruled yet.

I am willing to accept the court ruled date of separation of June, 1978.

Now, we do not want to battle in the court about dividing assets. So, we got to talking about division of property, and want to submit our stiputlon to the court for its approval.

As I said before, we agreed that we had $10,000 in savings account in June, 1978 as community property.

Does my proposal of fixing the community property portion of savings account at $18,000 (on the basis of 2 % annual interest rate) have any legal basis such as precedent(s)?

Thank you in advance for your answer.

 

[tranquility]

Not that I'm aware of. Division is division and not a net future value division. There is no way this should have been sitting around this long. While I'm sure there are some big cases out there for wealthy people who fought it out in the courts for a long time, you'll need a person to research them as it's simply not in the general knowledge books and I suspect few, if any, practitioners have any experience is such matters.

If there was 10K on date certain, I'd give each 5K and move on to other assets. Sure that may, in some economic way benefit one party over the other, but I suspect it will all even out over full division.

 

[LdiJ]

Not that I'm aware of. Division is division and not a net future value division. There is no way this should have been sitting around this long. While I'm sure there are some big cases out there for wealthy people who fought it out in the courts for a long time, you'll need a person to research them as it's simply not in the general knowledge books and I suspect few, if any, practitioners have any experience is such matters.

If there was 10K on date certain, I'd give each 5K and move on to other assets. Sure that may, in some economic way benefit one party over the other, but I suspect it will all even out over full division.

I am confused as to why this is even an issue.

If neither one of them deposited additional cash to the account since separation, then the entire account should be divided.

If one or both of them have been adding cash to the account since separation, then the question is why did they do that, and why shouldn't the entire account be considered to be marital property?

 

[tranquility]

If neither one of them deposited additional cash to the account since separation, then the entire account should be divided.

The OP wrote:

My wife has been entrusted to manage Savings Account since we got married in 1963. Since we have never thought of getting divorced, she has not kept any of records of deposits or withdrawals except very recent ones.

From the way the OP wrote, I suspect he did not make or gain benefit of any of those deposits or withdrawals.

If one or both of them have been adding cash to the account since separation, then the question is why did they do that, and why shouldn't the entire account be considered to be marital property?

If they did, I agree. Both as to the why question and as to the division answer. (At least absent the ability to trace.)

 

[mistoffolees]

To: mistoffolees
From: Harry Yoshida

Thank you very much for your answer. It is very helpful already.

The date of separation of June, 1978 was decreed by the Court, although the entire divorce proceeding is not over yet, i.e. Property division not ruled yet.

I am willing to accept the court ruled date of separation of June, 1978.

Now, we do not want to battle in the court about dividing assets. So, we got to talking about division of property, and want to submit our stiputlon to the court for its approval.

As I said before, we agreed that we had $10,000 in savings account in June, 1978 as community property.

Does my proposal of fixing the community property portion of savings account at $18,000 (on the basis of 2 % annual interest rate) have any legal basis such as precedent(s)?

Thank you in advance for your answer.

Amazing. You got a court order in 1978 telling you to split the account and you never did so? And continued to add money to the account?

Since 1978, how much money has been added and by whom? (even an estimate will do).