Married Couples and Money
Marriage is a union of two individuals sharing their lives, dreams, and future. However, one hotly debated topic among married couples is whether or not they should share the same checking account. Some argue that separate accounts allow for more independence and autonomy, while others believe that shared finances foster trust and communication. What do we think? Well, you get more autonomy with separate accounts but is that really a good thing? When married couples have separate checking accounts your vows are transformed into a conditional commitment that says we are married but, not all the way. You have most of me, but not all of me. Part of “my” money is not available to you and how I use it is hidden. Would you accept this lack of transparency in any other area of your marriage? No matter how you slice it, married couples are better off sharing the same checking account and working toward the same financial goals. We didn’t say it would be easy, just that it is best. Read on.
In this quick post, we’ll share 2 myths about separate checking accounts for married couples and the 3 benefits of sharing money the same way you share the rest of your lives.
2 Myths About Separate Checking Accounts for Married Couples
Proponents of separate checking accounts for couples will point to its many benefits. We dispel 2 of those myths here.
Myth # 1: It is a good way for us to maintain some autonomy.
Autonomy is great for college football team loyalties, political leanings, and food preferences. In these areas and others, it is great to respect one another and celebrate your autonomy. We are all different and your best marriage will be realized when each of you can be autonomous in many ways without the pressure to “believe” the same as your partner. However, money represents something entirely different. Money is the vehicle that allows you to retire with dignity, provide your children’s education, and build the future you want. When married couples have separate checking accounts they are essentially saying they want to protect their individual interests instead of the interest of their shared goals. Learning to budget and share common goals is a challenge but for those who are trained by it, great results will come. Successful married couples handle finances together and save the autonomy for football and food.
Read 6 money habits of successful married couples.
Myth # 2: It’s better to keep separate accounts since we disagree on financial priorities anyway.
“A house divided against itself cannot stand.” This famous quote from former President Abraham Lincoln was originally uttered to address an issue far different than household finances however the sentiment is 100% applicable. Married couples aiming their financial resources at differing financial priorities is a recipe for failure every time. Imagine two people rowing a boat in opposite directions. Even worse is the absence of any priorities at all. A couple not in sync with their financial priorities is playing tug-of-war even if they don’t know it. Married couples aim their dollars like a team; in the same direction and operating from the same checking account.
Couples use their joint checking account toward agreed-upon priorities.
- Set a time to discuss what you want your financial lives to look like in 5, 10, and 20 years.
- Decide together what goals should be set to reach your shared vision.
- Create a monthly budget that aims your dollars toward your goals.
3 Benefits of Joint Checking Accounts for Married Couples
Transparency is the name of the game! Married couples cannot win with money if they hide income or spending. If you are serious about winning with money, together, on purpose, then operating out of a single shared checking account is a must.
1. In marriage and money 1 + 1 = 3
Operating from separate checking accounts leads to a lot of “mine” and “yours” thinking. Why else would you have your own, private checking account? However, married couples who have learned how to budget their finances together and operate out of the same shared checking account find that together they can accomplish more than when they were separate. And it all starts with a budget.
A zero-based budget is important for married couples because it is an agreed-upon plan for how you prioritize your money. A zero-based budget puts all the cards on the table for you both to see. There is nowhere to hide. As such the weaknesses in the decisions you make with your money are revealed. For instance, if you are following a zero-based budget faithfully you will soon see if you are overspending on groceries or another category. Once you have that knowledge you only have a couple of choices: Keep overspending or adjust your habits to meet your goals. A zero-based budget is important because it shines a light on your spending decisions and creates opportunities for you to make joint choices that align with your shared goals.
Following a zero-based budget is important for married couples because it removes the unknowns and replaces them with knowns. When the unknowns are reduced the anxiety level reduces as well. Most couples experience anxiety around money because they don’t really know where their money is going or if they’ll have enough when they need it. What if I told you that you could know with almost certainty that when your car breaks down, you’ll have enough money to pay for the repairs in cash? Or that if your home’s roof springs a leak, you can handle the new roof without using credit? I bet your anxiety level would be reduced. A well-planned and executed zero-based budget allows you to know where your money is, where it is going, and how much you need to save to keep “Murphy’s law” from your front door.
Download your free zero-based budget pdf here.
2. Priorities and goals are aligned
The famous motivational speaker and author Zig Zigler once said, “If you aim at nothing, you’ll hit it every time”. When you have common, agreed-upon goals and dreams your everyday money decisions tend to wrap themselves around those goals and dreams. But without goals, you are “aiming at nothing”, and you’ll find yourself living a very inefficient financial life. Want to retire with dignity and leave a legacy for your children’s children? Discuss your goals and dreams and agree together on what you’ll pursue. When you have separate checking accounts you tend to use money according to your own ends. Working together brings better results.
3. It is a huge indicator of future success
Traditionally, married couples have usually held one joint checking account. However, in more recent years there has been a trend toward separate checking accounts for married couples for a variety of reasons. Many think of it as an insurance policy against a messy split. However, according to new research, there is a potential downside to having separate checking accounts as a married couple: Couples who keep their financial resources separate are less happy with their relationship than couples who don’t—and their relationship is less apt to survive.
This 2022 study of 1,000 married couples was divided into 3 cohorts; those who completely pooled their money, those who partially pooled their money, and those who kept it completely separate. Those who pooled their resources were significantly happier in their relationship than those who didn’t pool resources at all or only pooled them partially, with those who didn’t combine them at all being the least happy of the bunch. In the British Cohort Study, pooling resources also reduced the probability that a couple would split up. (Acknowledgments to Greater Good Magazine for this excerpt.)
Successful married couples handle finances by evaluating their daily spending decisions against a monthly zero-based budget they have created together. A budget is a practical tool that allows married couples to handle finances toward their goals and priorities. Voluntarily submitting their spending decisions to the boundaries of their shared budget and checking accounts is a strong signal of future success.
Should Married Couples Have Separate Checking Accounts?
No. We don’t think so. In fact, with couples I have coached, handling all finances from the same checking account has had a positive impact on debt reduction, trust, and harmony 100% of the time. When couples combine their finances into the same checking account, budget their money together in pursuit of their agreed-upon goals, and behave according to their agreed-upon priorities the best results are achieved. Married couples who share the same checking account will initially experience greater challenges such as communicating and negotiating with their spouse. However, the results of this growth are undeniable.
Adults create plans and follow them. Children do what feels good.
7 Steps to Financial Wellness for Married Couples
- Save a starter emergency fund of $1,000 as fast as you can.
- Pay off your debt. Start by listing all of your debts except for your mortgage. Put them in order by balance from smallest to largest—regardless of interest rate. Pay minimum payments on everything but the little one. Focus on that one until it is gone. Then take that payment and put it toward the second-smallest debt, making minimum payments on the rest. That’s what’s called the debt snowball method, and you’ll use it to knock out your debts one by one until you are debt-free except for the house.
- Save a full emergency fund of 3 to 6 months of household expenses
- INVEST 15% of your gross income toward retirement.
- CONTRIBUTE to children’s college education fund.
- PAY off the house early.
- Build wealth and be generous.
Note: Steps 4,5 & 6 are worked on at the same time.
