Financial Fridays: Why every couple should keep separate bank accounts * River City Belle

Financial Fridays is a series of unsolicited but much needed financial advice.

Jerad and I keep separate bank accounts. Are you shocked? Keeping separate bank accounts allows us each to maintain our financial independence and remain happy partners. Don’t worry, we also keep a shared account.

All couples argue about money; it’s the reality of life and marriage. Anyone who tells you that they and their spouse never argue about money is lying! The spending and saving habits of individuals vary widely, and you may find that your partner in life is not your money soulmate. Jerad and I have very different philosophies on money, but we’ve always had open conversations about our financial goals and the lifestyle we want to live. Our money conversations started before our engagement. At the same time, we were planning our life together; we also began planning our financial future.

Once we were engaged, we developed a financial setup that worked best for us and our relationship. Our financial setup is incredibly easy to monitor, ensures us financial independence separately, but also provides our economic security as a family unit.

Yours, Mine, & Ours

Yours, Mine, & Ours is the phrase we’ve coined to explain our financial setup to friends and loved ones. The setup also ensures that we are treated as equal partners in our relationship, regardless of who earns more money. As a couple, we’ve weathered times of underemployment, unemployment, injuries that left one of us on short-term disability. Through all of life’s scenarios, the Yours, Mine, & Ours approach has kept us financially sane and minimizes our arguments about money.

Ours

The entirety of all our paychecks funnels through our main shared account. The funds in the Ours account are then used to pay our monthly bills, donations, and expenses. We make an effort to save for special occasions, vacations, and emergencies. As a couple, we periodically re-assess our goals and adjust our financial plan. Our financial plan is on a shared Excel spreadsheet with tabs for each month of the year.

We always take care of our shared expenses and our shared goals before we set aside discretionary funds.

Yours & Mine

At the end of each pay period, we divide the remaining balance of our paychecks into two smaller amounts. These smaller amounts are then transferred into our personal accounts to be used at our discretion. We have a cap set for our discretionary money. I use my funds to dine out with friends for lunch or dinner, reward myself with a manicure, surprise my husband with a gift, or fund my latest travel adventure or a new purse. We never argue over how much I spend on a purse or how much he spends on new computer because we don’t know how much the other is spending. It all comes from our personal funds.

I already know what you’re thinking, how do you all have that much money?!?! We don’t. Sometimes our discretionary money has been as little as $10. The concept is about having $10 that is your own. It allows us the freedom to purchase things we want after we know our “Ours” has been paid. By setting our discretionary amounts the same we create an environment in which we are equals. Separate accounts allow me to fund my adventures while still maintaining our shared financial goals.

We each have a side hustle, and we don’t share our side gig money. Those go straight into our own accounts.

This Won’t Work for Us, I Make More Money Than My Spouse

Yes, it will. Marriage is a lifelong commitment in which two individuals have decided to build a life together. You’re not in competition and equal partners should share equally in the finances. The spouse that makes less still has the same value to the marriage as the one that makes more. If you were the lower-earning spouse, wouldn’t you want to be treated equally?

Separate Accounts = Infidelity or a Lack of Commitment

No, no, no. In fact, separate accounts mean trust. I don’t need to see all of Jerad’s spending. I know the bulk of his discretionary money is going to his savings account or to the local comic book store for the latest copy of Oblivion Song.

If a separate account immediately makes you think that your spouse is being unfaithful, well then… you have a relationship issue that is much larger than your finances. The two of you are in desperate need of a heart-to-heart conversation about your relationship.

We Keep Our Accounts Completely Separate, That’s What Works for Us

So, you keep separate accounts and you each have a responsibility to certain bills. One of you pays the mortgage the other pays the electric and cable bill. If that is what works for you, great! However, if you are using this method and find yourselves arguing over which money went where I highly recommend trying out our system. If nothing else, it feels drastically less complex.

In the end, you and your partner have to make the decisions that are best for your scenario and relationship. Talk openly with your partner about your goals. Where do you want to live? Do you want to buy or rent a home? Is cable a necessity to your life? How often do you want to travel? Once you have a financial plan for your relationship, you can work on creating a budget and begin achieving your financial goals.