Closing Joint Bank Accounts After Divorce in Australia

Your divorce is finalised, but your ex-spouse can still withdraw from your joint bank account tomorrow morning. Australian banks treat joint account holders as "either to sign" by default — meaning either party can empty the account without the other's consent or knowledge. Until you act, your money is exposed.

Freeze Before You Close

Before closing any account, lock it down:

1. Contact your bank immediately and request a change from "either to sign" to "both to sign" (dual signatory). This prevents either party from withdrawing without the other's approval
2. Cancel or freeze joint credit cards — banks hold both account holders jointly and severally liable for the full balance, regardless of who spent the money or what your separation agreement says
3. Suspend redraw facilities on joint mortgages by writing to the lender. Without this, your ex can redraw equity you've both been paying down

These protective steps should happen as early as physical separation — you don't need to wait for the divorce to be finalised.

Steps to Close a Joint Account

Once your property settlement is formalised through Consent Orders or a Binding Financial Agreement:

1. Open an individual account in your own name at the same or a different bank
2. Redirect all direct debits and salary payments to the new account — go through three months of statements to catch quarterly debits
3. Transfer the agreed balance to your individual account per the settlement terms
4. Visit a branch together (or both contact the bank separately if required) to formally close the joint account
5. Get written confirmation of the closure and zero balance

If your ex-spouse refuses to cooperate with closing the account, most banks will allow you to remove yourself from the account with written notice, though the process varies by institution. You may need to provide a copy of your Consent Orders.

Credit Cards: Joint Liability Doesn't End With Divorce

This is where people get caught. A court order dividing debts between you and your ex-spouse is binding between the two of you — but it does not bind the bank. If your ex was supposed to pay off the joint credit card and doesn't, the bank can and will pursue you for the full amount.

The safest approach:

• Pay off the balance in full using settlement funds
• Cancel the card entirely — don't just remove yourself as a secondary cardholder
• Get a statement showing zero balance before the account closes

If you can't pay it off immediately, at minimum convert it to a "both to sign" arrangement so no new charges can be added.

Redraw and Offset Account Risks

Joint home loans with redraw facilities are a frequently overlooked risk. If your ex's name is still on the mortgage, they can access the redraw balance — potentially tens of thousands of dollars — without your consent.

Write to your lender requesting:

• Suspension of the redraw facility, or
• Conversion to dual-authorisation for any redraws

Do this before your property settlement is executed, not after.

Separating Everyday Financial Accounts

Beyond bank accounts and credit cards, work through this list:

• PayPal, Afterpay, Zip Pay — remove your ex's linked cards or payment methods
• Joint savings and term deposits — note any early withdrawal penalties before breaking a term deposit
• Shared brokerage or share trading accounts — these require the settlement terms to specify who gets what
• Loyalty programs — Frequent Flyer points, hotel rewards, and credit card points are increasingly contested in settlements

Timing Matters

Don't close joint accounts before your property settlement is finalised — the court needs to see a complete picture of the asset pool. But do put protective freezes in place immediately upon separation. The gap between separating and settling is when financial damage typically happens.

The NSW After-Divorce Checklist includes a financial account separator worksheet that tracks every joint account, its status, and the steps needed to untangle it — so nothing gets missed during the split.

See more New South Wales guides →