When we were young and childless, my husband and I kept separate bank accounts. I loved how it underlined that we were both individuals, able to exist independently even as we merged furniture and moved in together. But after we had our first child and expenses such as childcare and Little Gym entered our lives, we merged our checking accounts into one joint account. Outgoing expenses became primarily about the child — then children once we had another — and it was comically ridiculous to pull from multiple accounts.
But is having a joint account with your partner or spouse really a smart idea? Or is it a fast track to trouble? What kind of things should you take into consideration before merging your entire financial world with another person? In 2018, a report from Bank of America showed that 28% of partnered millennials polled chose to keep their banking accounts and finances separate — compared to just 11% of Gen-Xers and 13% of Baby Boomers.
To understand the pros and cons of each approach, Scary Mommy spoke to four experts. And, well, there are a few things to keep in mind before you sign on that joint dotted line.
The Case for Separate Bank Accounts
Suze Orman, the rockstar financial guru, has always advocated for each member of a partnership to have their own separate bank account. Reasons she gives include keeping a balance of power and one partner being able to leave the other without being penniless. I definitely get that, but I also know that Orman has never had kids nor experienced the wild expenses that come into your life once you do.
That said, I have a good friend who remarried and merged households, with a total of six kiddos between them. When I asked if she and her new husband had separate accounts, her answer was "of course." Having both divorced, they understand the value of keeping tabs on their own cash. They also each take financial responsibility for their own bio kids. Finally, if he wants some garden equipment while she wants some new clothes, they see the value in not having to ask each other's permission. After all, they each have their own job and paycheck. They settle joint expenses via Venmo. And I admit that they make it look easy.
Why Having One Bank Account Makes Sense
I perhaps could have sustained our separate-account system through parenthood if everything was still paid by cash or check. Now, with so many expenses automatically withdrawn and everything else paid online, I just do not have the bandwidth to negotiate whose account each expense should come from.
Ashley Quamme, a licensed marriage and family therapist in Georgia who walks couples through financial issues, says one account works for her family, too. "My husband is a certified financial planner, and personally, we merged all of our accounts except for our business ones," Quamme says. "Our pay goes in, and our bills are auto-drafted. We each know what's going on and feel equally responsible. There's no hiding purchases. But professionally, my role is not to tell couples what to do, but to help them to figure out how to come to an agreement and navigate the nuances to make it work."
An Ideal Middle Ground: Separate and Together
As with many things, there is a great compromise, spelled out nicely by another rockstar financial guru and mom to young kids, CNET Money Editor at Large Farnoosh Torabi. "I suggest a three-account strategy: mine, yours, and ours," Torabi says. "Keeping separate accounts for your own 'stash' of money you can freely spend without needing to have a conversation is, in my opinion, imperative for modern couples who crave financial independence as much as financial 'one-ness.' Then use a joint account for the expenses you want to share."
Torabi does note that this three-account strategy works best for dual-income households, where each person makes roughly the same. If one parent makes the bulk of the income, this compromise might be less than ideal. Melanie Anderson, a teacher and mom of three in Winona, Minnesota, who blogs at loopylittleletters.com, points out that it created a lot of tension when she and her husband tried to both contribute to a joint account. "I felt like it put a spotlight on the disparities in our salaries," Anderson says. Since she was at one point doing the full-time childcare, it was important that she could "see everything that comes into the bank as 'our' money." They went back to one joint account.
Ultimately, "There is no right or wrong answer, and it depends on what works best for the couple," says Jaclyn Strauss, a mom, CPA, and CEO of 2ndVault.com, which helps people store financial information. "At the end of the day, kids are freaking expensive, and you have to factor in the labor and work to keep track of the amount you spend on them. Time is money."
Her point: Do what makes the household run smoothly and keeps the peace, and give up on the notion that there's a one-size-fits-all answer to this relationship question.
Ashley Quamme, licensed marriage and family therapist
Farnoosh Torabi, CNET Money Editor at Large
Melanie Anderson, a teacher and blogger at loopylittleletters.com
Jaclyn Strauss, CPA and CEO of 2ndVault.com