How to Hide Money From a Spouse Legally - 10 Ways
Hiding money from a spouse is almost never a good idea, even if you're worried about divorce or want to surprise your spouse.
However, there are some legal ways to hide money. Here's how to hide money from a spouse legally in abuse cases, to protect assets in anticipation of divorce,* or in other challenging situations.
*Note that this article is for general, informational purposes only, and it should not be considered legal, tax, or investment advice. For help with your specific situation, contact the appropriate professional.
Why Hide Money - Is It a Good Idea?
Everyone has different reasons for hiding money. Some reasons may feel legit, but typically, it's not a good idea to hide money from a spouse.
Common reasons I find for people having a money stash are 'just in case' they get divorced or to have money to surprise their spouse.
Rather than hiding money, though, it's better to be open about your financial assets and agree on an amount both parties can keep in a separate bank account with no questions asked. This way, both parties feel protected, but no one hides cash or can be accused of financial infidelity.
But sometimes it's necessary, so here are ten ways to legally hide money from a spouse.
10 Ways to Hide Money From a Spouse Legally
Technically, it's not illegal to hide money from a spouse, except in the case of divorce proceedings. So if you need to have hidden money, here are ten ways to hide it.
1. Don't Disclose New Income to Spouse
If you work and receive a raise or bonus, don't disclose it. You aren't lying, because you didn't tell your spouse you didn't get a raise or bonus. But you aren't revealing the truth either. Instead, you can transfer the 'extra' money to a separate bank account and keep your regular income in your joint account.
2. Get Cash Back Each Time You Check Out
If you pay with a debit card at checkout, at most stores, you can ask for cash back on top of the purchase price. So if your total was $40, but you requested $80, you'd receive the extra $40 in cash, which you can put away.
3. Safety Deposit Box
If you have a cash stash already, you can open a safe deposit box at your local bank and hide the cash in it. If it's only your name on the safe deposit box, your spouse doesn't have access to it and won't know what or how much it contains.
4. Paying off a Loan From Family
If a family member lends you money, you must repay them, right? If you tell your spouse you're reimbursing family members for the money you borrowed, they won't have much to say. Whether the money is loan repayment or money they're setting aside for you is a personal matter, but it can give you the cash you need to make a move if you need to leave.
5. Buy New Possessions
Buying new possessions puts your money into something that typically isn't liquid. However, if you can return the items or sell them on the secondary market, you'll get cashback for the items without worrying about hiding assets.
6. File Taxes Separately and Overpay
If you and your spouse file taxes separately, you can increase your tax withholdings, which means your employer will keep more money out of your paycheck. You'll get the money back when you file your tax documents, but for now, it hides money from your spouse.
7. Gather Prepaid and Giftcards
You can hide money on prepaid cards and gift cards, just be careful. Make sure that they don't expire if you don't use them and that you don't lose them if they are physical cards. The money usually isn't insured, so if you lose a prepaid card you loaded hundreds of dollars onto, you may not get it back.
8. Not Disclose Cash Income
You can hide any money you earn outside of your regular income and in cash. Side hustles are great for this, as many pay cash. In addition, you can stash the cash somewhere safe like a safe deposit box or in private bank accounts and not worry about your spouse finding it. (Note that cash earnings are still typically taxable as ordinary income.)
9. Take Out Your Own Personal Credit Card
If you have decent credit and a job, apply for a credit card in your name only. If your spouse's name isn't on the card, they can't see or use it. Have statements sent to your separate email address, and your spouse won't know about it.
10. Delay Promotions and Bonuses
If you're due to receive a promotion or bonus at work, such as stock options, consider asking your employer to delay it. This is because if you have yet to receive the higher income or bonus, it potentially may be excluded in divorce proceedings, and you can keep the money to yourself.
Divorce
Most people want to hide assets before a divorce because most marital assets get split down the middle in court. But each state has different laws, mainly falling into the two categories discussed immediately below, so be sure to consult a qualified attorney for legal advice.
Community Property vs. Equitable Distribution
Community property division usually means marital assets are split 50/50. Marital property means any assets (or debt) either spouse acquired (or incurred) during the marriage. However, any assets owned before the marriage that wasn't commingled (used for both parties) may remain separate.
In equitable distribution states, assets in a divorce are divided fairly according to the court's definition and analysis. As a result, both spouses usually walk away with some of the assets, but it might not be precisely a 50/50 split in terms of dollar value.
Hidden Assets
Hiding assets in divorce is illegal and can lead to penalties. If a spouse wants to locate hidden assets or detects suspicious activity and wants to know more, they can start a 'discovery process.' This legal process allows each party to obtain information about the other's assets and financial status.
Hidden Assets Penalties
If the courts find that either spouse owns assets that they didn't disclose, and either you or your ex-spouse lie under oath about it, that could be a punishable crime. The penalties may be financial, or the courts could bring up more charges against you or your ex-spouse.
Protecting Assets in a Divorce
Rather than hiding assets in a divorce, consider learning how to protect assets in a divorce. The more prepared you are for the separation or divorce, the easier it might be.
Know All of Your Assets
Take inventory of your financial assets by downloading account statements for the last 12 months. This way, if you're locked out of accounts, it won't matter.
Categorize assets that belong to you, belong to the other spouse, and are shared. Next, note if recent large withdrawals or other suspicious transactions might make you think your spouse is hiding assets.
Monitor Your Credit
Everyone can pull their credit reports weekly for free from all three credit bureaus. Pull your reports, and look for any recent activity you don't recognize, such as large credit card purchases, new credit lines, or bills not getting paid.
Move Some Assets to a Private Account
Before you go your separate ways, consider splitting the joint accounts into separate accounts. Take half, or as close to it as you can, and put it in into separate accounts for each of you. Of course, the courts will have the final say in who gets what, but at least you'll protect yourself from being locked out of the accounts, without money to sustain yourself.
Hiding Money FAQs
What Are Some Illegal Ways of Hiding Money From Your Spouse?
There are many ways to illegally hide money from your spouse. Some of the most common include undervaluing assets, getting your boss to pay you 'under the table,' overpaying bills, and getting a safe deposit box. (Note: I do not endorse these methods, and nothing in this article should be construed as any explicit or implicit endorsement of such activity.)
How Do You Find Hidden Assets?
During a divorce, your divorce attorney can ask for a discovery process if you think your spouse is hiding money or other assets from you. The process takes a while, but it covers all money in any accounts your spouse could be hiding.
What Is a Red Flag That a Spouse Is Hiding Assets?
Some common red flags that a spouse is hiding cash or assets include receiving mail from a bank or credit card you don't recognize, a sudden refusal to talk about money, a sudden lower paycheck because your spouse has more money kept for taxes, and unusual financial transactions on your bank statements.
Can I Empty My Bank Account Before Divorce?
You can empty your bank account before divorce, but the courts will still decide how much each person gets. Therefore, it's often wise not to spend any money you take out of the account until you know what the courts say that you're entitled to receive.
Can My Spouse Take My Retirement in a Divorce?
Any retirement benefits earned during the marriage usually become marital assets and therefore become a part of the divorce settlement/judgment.
Can My Spouse Take My Inheritance in a Divorce?
Whether your spouse can take an inheritance in a divorce depends on when you received it and how you used it. For example, if you received it before the marriage and never used the funds for anything within the marriage, your spouse likely won't get anything. However, if you receive it during the marriage and/or use the funds benefiting both parties, then your spouse may be entitled to a part of it.
How to Hide Money From a Spouse Legally: The Bottom Line
Knowing how to hide money from a spouse legally is important, but you should always be 100% honest with the courts if you get divorced. Lying under oath is punishable by law, and a good divorce attorney can start the discovery process to ensure no assets are hidden by either spouse. Instead, be honest with one another, and share the assets as allowed by law to avoid any illegal activity.
Want to level up your game around money in your relationship? My free quiz will help you learn your Couple’s Money Personality Type AND how you can grow from there!
Adam Kol is The Couples Financial Coach. He helps couples go from financial overwhelm or fighting to clarity, teamwork, and peace of mind.
Adam is a Certified Financial Therapist-I™, Certified Mediator, and Tax Attorney with a Duke Law degree and a Master's in Tax Law from NYU. He is a husband, dad, and musician, as well.
Adam's wisdom has been shared with The Wall Street Journal, the Baltimore Ravens, CNBC, NewsNation, and more.
