Marriage and money. They often go hand in hand. That doesn’t mean money should come between you and your partner. That is why many experts recommend that couples have separate bank accounts. It keeps money outside the equation and still inside the house.
What the numbers say
More than one in four millennials manage finances separately in their marriages or long-term relationships. One in five millennials doesn’t know their partner’s earnings or how much money is in their bank account. This is a noticeable shift because only 11% of Gen Xers and 13% of baby boomer couples have individual bank accounts.
Many conservative financial experts believe that separate finances lead to the separation of relationships. A 2006 study concluded that couples with joint accounts were expected to stay together and were serious about their relationship. These experts believe that lack of trust leads to having individual accounts as a family is a single unit, and both spouses need to work together.
On the other side, several other experts believe that long-term couples should not have joint accounts and rather have separate bank accounts for the following reasons:
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Privacy, autonomy and control
Many argue that separate finances are keys to a healthy relationship as it builds trust. It shows that each spouse has more faith in the other to have individual bank accounts and maintain privacy. Having separate accounts doesn’t mean that a family doesn’t function as a unit. The spouses can remain faithful to each other even with individual accounts.
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Different spending habits
In every relationship, each person’s spending habits will be different. They both feel that a specific purchase could have been avoided, and the money could have been saved. Moreover, many studies prove that financial misunderstanding is one of the root causes of breakups and divorce. Separate accounts reduce misunderstanding.
Protection from creditors
Unlike a joint bank account, separating your account will protect your spouse from being contacted by your creditors.
Which is the best?
Both. The amount you had saved like inheritance or savings when you were single is not considered marital property until you merge it with a joint account. Having a joint account and individual accounts gets you the best of both generations. You can get to maintain privacy and also share the funds used to pay bills, etc.