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by Sarah Sharkey
December 31, 2020
by Sarah Sharkey
December 31, 2020
When you are building a life with someone, it is essential to get on the same page about money. Thoughtful conversations are the key to setting up systems that work for your shared life.
Although it can involve some trial and error to find the system that works best for you, it is worth the effort. For my husband and me, we've completely changed our minds about how we manage our household finances after being married for a year.
Here's how we worked through our decision to switch from separate accounts to completely joint finances.
My husband and I were married last year in a beautiful ceremony in my hometown. The wedding was lovely, but we were most excited to start our lives together, which included getting on the same page about money.
Before we tied the knot, we discussed the future of our finances and the money goals we wanted to set as a couple. Luckily, we were able to get on the same page about our financial goals. But we both liked our existing financial systems.
Each of us had been using different banks for many years. Neither one of us had a desire to leave our current banking system behind. The main logic behind this decision was that the paperwork involved in combining our finances to a joint account seemed like another chore that neither of us wanted to tackle.
So instead of combining our finances into joint accounts, we decided to keep things separate. At the time, we thought that keeping our finances separate was the right choice. We would be able to continue using the checking accounts that we set up before marriage without any more paperwork. The plan was to cover shared household expenses by communicating about what needed to be paid and taking care of certain bills out of different accounts each month. Plus, we could still set aside money for shared savings goals.
But we quickly realized that this approach was too involved for us.
After a few months of paying household bills out of two separate accounts, we were starting to wonder if we should make a change. We thought we would be saving ourselves a hassle by not switching bank accounts. Instead, we had to work together to cover our household expenses in a strange dance of separate checking accounts.
With careful budgeting, we had enough to cover our bills and set aside money towards financial goals. But when something like a major vehicle repair came into the picture, our carefully laid plans were thrown for a loop. The issue was that our funds weren't easily accessible in one place. For us, that caused too much of a hassle to justify.
Eventually, we decided that separate checking accounts weren't working for us. Although the process of combining our accounts into a joint account seemed like a hoop to jump through, we decided to make the change.
When we merged our checking accounts into a joint account, it gave us both a sense of relief. Instead of spending too much time shifting money around, we could set our bills back onto autopay.
With both of our incomes going into the same account, we were able to build a more substantial buffer that was difficult to maintain in two separate accounts. If an unexpected expense throws a wrench in our monthly budget, we don't have to shift money back and forth to adjust for its impact. Instead, we can rely on the buffer we've built together. Plus, we can both quickly understand where we stand for the month without checking multiple accounts.
Since we both like the flexibility of having a little bit extra in our checking accounts, this helps us stay on top of our bills. But keeping a modest buffer in two separate checking accounts was not an efficient approach.
For us, we aren't concerned about having the freedom to spend out of separate checking accounts. Instead, we want to be able to stay on track towards our financial goals together. Although this approach might not work for everyone, it works well for us.
The switch has saved us more time each month. Instead of working together to get the bills paid, we can simply enjoy our time together as newlyweds.
Are you and your spouse looking to combine your finances in a new checking account? Check out our Total Access Checking account, which can help you both get on the same page.