I’m firmly of the belief that when you marry, you do so because you want to spend the rest of your lives together, help make better decisions together and because you share similar interest and goals. There should be no more name-labelling the peanut butter jar, so to speak. Like the saying “mi casa e su case” (my house is your house), we share our belongings, our meals, heck even our bed. So why is it that so many are afraid of marrying their finances?
According to an RBC poll, one-third of Canadian couples between 18 and 35 now keep separate bank accounts. I was there too. Prior to getting married and buying our first home, we discussed merging our bank accounts (after we were married). Well, actually my wife brought this up. And I never really thought much of it. At first I was a little reluctant to do so.
After all, isn’t my money, my money?
I had my checking account, she had hers. Neither of us were making much more money than the other. She had over $25k in student and car debt (now zero!); I had none. But my reluctance really had little to do with her debt (as I was already helping her out with some of her loans). Looking back, it probably had a lot more to do, with the thought that I was giving up independence or some version of it.
So what made me change my mind? She asked me one simple question: What’s your hesitation with joining accounts, wouldn’t it make it easier? I can’t recall what I said that day, but I know I really didn’t have an answer for her. I mean, what was I trying to hide?
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We kept our own personal accounts alongside the joint one for probably the first six months of marriage, but it was more complicated than it needed to be. Here’s just a few reasons why I think having a joint bank account makes more sense:
- It’s just easier. Having multiple accounts can get complicated. With one account, you don’t have to worry about who pays for what and for what bill. Whether online or through your branch, you can easily access all your transactions from one convenient spot – money comes in, money goes out from the same bank account. Less fees, things to track and ultimately less mishaps (i.e. missed payments, etc.).
- Encourages better communication. Joint accounts forces you talk about money more openly, more often. And that’s a good thing! No one’s left in the dark. It makes everyone accountable. Yes, you might have to explain that big screen TV purchase to your spouse, but really, your 60-inch plasma sitting on your wall can barely be called a hidden expense. Money can cause a lot of friction in a relationship, it’s best to be open and work together. We also schedule monthly 10-minute budget talks, just to review if we’re on track.
- It allows you to work together, towards common goals. You’re a team now. Surely you share some of the same hopes and dreams. One of the cons I often hear is the “if one is a saver and the other is a spender” argument. Well it’s true that that can be tough. But all relationships involve compromise. So it’s so important to be open and have a honest discussion around money and what your financial goals are with your partner.It doesn’t make sense to me that the spender in the relationship spends the rest of their years working, while the saver, retires early and ends up yachting it up in the French Riviera with their friends. Your goals should align. You should be yachting together or whatever it is that floats your boat. But it’s important to be on the same page.
If you want to have some personal fun money, you can still have a joint account and set aside a certain amount you budget each month for your own personal use. We use cash or have separate credit cards, for surprise birthday and Christmas gifts that we don’t want each other to know about.
But it’s also important to ease into it. If you’re really uncomfortable about the whole thing, start small. Start a joint bank account where only some of your smaller expenses are paid from that account, while maintaining your separate accounts, until you’re both comfortable and ready to merge. I realize merging your finances is not always an easy task. It’s a big step in living together and trust plays a huge role. But I also know that relationships can’t survive without trust. Although having a joint account has worked really well in our case, it’s worked because we were open about money and our money issues. If you’re not, that’s a good place to start.
If you have separate accounts, I’m curious to know why ? How do you separate all your bills?