Should Married Couples Have Separate Accounts?

September 19, 2012

Susan and I have been married for seventeen years, and when we were first married, we decided to pool our financial resources and have one checking account. This made sense since at the time, we shared all of our expenses. In fact, for most of our married life we have maintained a joint checking account, but several years ago, I asked Susan to open her own checking account. With all of the different inflows and outflows of money, it was getting harder and harder to keep track of how much was available at any point in time, so I asked her to open a separate account as a way for us to keep better track of how much we could spend on food, clothing, and other expenses associated with running a household of four kids on a daily basis.

For the last several years, I have had a portion of each paycheck deposited into our joint account, which is used to pay for joint expenses such as our mortgage, insurance, and utilities, and a portion deposited into her separate account, which is used for groceries, clothes, and school supplies. In other words, the more planned, fixed expenses come out of the joint account while the more variable expenses come out of Susan’s account. Since I am a financial planner by trade, and Susan is more involved in the day-to-day expenses associated with our household, it has worked well for me to focus on the planned things, while she focuses on the daily things.

Here are some things to consider when it comes to deciding whether joint or separate accounts are right for you:

The Two Shall Become One

When you become married, by default you and your spouse will share certain expenses. It makes sense to have a common account to pay for these joint expenses. In a single-income household like mine, I want to make sure there is enough income going into this account to satisfy these regular joint expenses. For dual-income households, it is suggested that each income earner contribute an equal percentage (not amount) to this joint account.

By having shared expenses and using a joint account to take care of them, Susan and I need to be on the same page. To accomplish this, Susan and I have regular meetings to discuss our joint finances. In these meetings, we talk not only about where we are spending money now, but also where we may need to spend money in the future. By communicating regularly, not only do we manage our finances, but we also manage our marriage.

More Autonomy, More Control

It may be tempting to consolidate all financial resources into one account, but experts say there is a benefit to allowing each spouse to maintain his or her own financial account as a way of maintaining independence and flexibility. Prior to having separate accounts, Susan would sometimes be anxious about making a spontaneous purchase because she wasn’t sure if it would “bust the budget,” but now that she manages her own account, she has a lot more autonomy in making those purchase decisions. It does force Susan to pay more attention to what she buys, but I don’t have to worry about her and I make purchases based on the assumption that the same amount of money is available to both of us.

What Not to Mix

Even if a couple did decide to combine all of their financial resources, there may be situations when a separate account is justified. DivineCaroline.com offers three situations in which having a separate account may be appropriate:

  1. If there are obligations related to a prior marriage, such as alimony or child support, having a separate account makes it easier to keep track of these expenses and not commingle them with the current household expenses.
  2. If one spouse has poor credit or is working toward paying off debt, having a separate account can help execute a debt repayment plan while rebuilding the credit.
  3. If a spouse receives an inheritance, a separate account will give them the flexibility to manage this money as they see fit.

In the end, there is no right or wrong answer to this question. The important thing is that the couple agrees on whichever method they choose and then regularly reviews how things are going to decide if it’s working or if adjustments need to be made. Even after seventeen years, Susan and I are making adjustments, but she knew I was a work in progress when she married me.