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Married with (Sort of) Separate Checking Accounts - Live Like a Mensch
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Live Like a Mensch

Married with (Sort of) Separate Checking Accounts

 

I feel like this picture from our wedding is an excellent metaphor for how J and I handle our money.

 

There are a couple of money issues that are guaranteed to start a flame war online (a gentle one, since personal finance folks tend to be awfully nice). Those include:

  • Paying children for chores or good grades
  • The relative evilness vs. usefulness of credit
  • Paying off debt in a smallest-to-largest balance "snowball" fashion or focusing on highest interest debts first.
  • Whether married couples should have joint or separate checking accounts

It's this last one that I thought I'd tackle today, because I think J and I do this differently from anyone else I know.

We have separate checking accounts, separate savings accounts, as well as a joint savings account for our emergency fund and our longer-term savings.

Since J and I have very different spending and savings habits, this is what we need to do in order to maintain sanity and marital harmony in our household. For example, I consider a checking account something that can and should be used, so I plan for it to go down to a zero balance (basically) each month. Because I balance my checkbook on a several-times-a-week basis, I have only ever overdrawn my checking account once, and that was when I was teaching and working a 60-hour week. (Ironically, it was when I was making the most money I've ever made in my career that I overdrew my account. Whenever I've been living hand-to-mouth, I've had no issues keeping my account in the black). I regard my personal savings account (in which I always keep at least $1000) as my "cushion" in case of bad math or other mistakes. Since I am so diligent about double checking everything, I have always been able to transfer money before there's a possibility of overdraft.

J, on the other hand, is very uncomfortable with a checking account that goes down to zero. He prefers to leave a cushion right there in checking, partially because he has never successfully kept a check register (don't get me started), and partially because he likes knowing that he's got money instantly available in case of emergency.

Considering our completely different approaches, if we were to merge our accounts, it would be all over except the shouting.

So, we have separate accounts. That doesn't mean that we don't regard our money as our money. It just means that J gets to have an account with a large enough cushion to keep him from staying up nights worrying, while I get to have an account that I can use to its fullest without worrying about what it's doing to J's blood pressure.

So far, this is pretty standard stuff for the separate account route. Where we differ is in the fact that we still have one person who has been elected Money Czar in the relationship. (That would be me).

One of the "cons" of having joint accounts is that one person has to take care of the finances or else things will quickly slip into a "But I thought you were going to pay that bill" or "I forgot to tell you I charged $150 last week" chaos. (No Money Czar with a joint account means that it's dogs and cats, living together. Mass hysteria!) If neither person wants to be Money Czar (and really, the official hat is not really that cool), then either you end up overdrawing your account and not paying your bills, or someone ends up doing the chore and feeling resentful.

For me, having to be in charge of our accounts would not be bug, but a feature, of having joint accounts. I love managing money. I even like paying bills. It gives me a sense of accomplishment, particularly if we have money left over at the end of the ceremonial bill-paying.

And since J does not keep a check register or really pay more attention to his account other than to see what his balance is (which drives me crazy), I wouldn't be at all averse to being in charge of family finances.

Which is why I am. Even though J and I have separate accounts, and I cannot write a check on his account and vice versa, I do have password clearance to his checking account and have our accounts linked. So when J gets his paycheck, I transfer some of the money to my account so that I can pay bills and take out cash for our envelope system. (I also transfer money from my account to his if I ever receive money in my account that ought to be in his). I keep a check register for his account.  I never let his account get below a certain threshold that we have agreed upon. I keep track of the automatic payments and withdrawals from J's account and I pay some bills directly from that account.

This system completely works for us. I get to do the happy dance of numbers for both of our accounts, and J gets to feel comfortable that a) bills will be paid and b) there's always a pre-determined minimum balance in his account, while not having to do the money chores that he hates. This system does make it more difficult to buy surprise gifts for each other (or rather, for J to buy a surprise gift for me), but I'll take the small inconvenience if it means we feel pretty streamlined in our attitude and approach towards money. (Also, unless he's buying a gift for me online, he can always use cash to buy a gift and keep it a surprise from me, since we do use the envelope system and we each have our own spending money from the cash stores).

For me, I feel like having separate accounts with me as the Big Cheese Overseer works because it allows us to both feel comfortable while still taking advantage of personal interests and strengths. It may be a somewhat complicated system, but organizing a complicated system doesn't bother me in the slightest.

If our accounts were joined, I know that we would each get frustrated with the other for how we prefer to handle checking. If our accounts and our money management were completely separate, I know that we would fight about things not getting taken care of in the way that wanted them to. With separate accounts that we both can access (since J also has password clearance to my account--he's just less likely to use it), I can be my OCD self over our money, but still keep both of us happy in how the funds are managed.

The problem with articles about whether to have joint or separate accounts (or Yours-Mine-and-Ours accounts) in marriage is that it's trying to give general advice for something that is very specific and personal to the married couple. I can't imagine many people that our system would work for, and it took us several years of trial-and-error to find this method of managing our money. Every couple is going to be different and will have different preferences, habits, strengths, and weaknesses. So saying there are only two options for handling money--joint and separate--ignores the many different weird permutations that will work on case-by-case bases.

How does your household handle finances? Does anyone else have a system as strange as ours?

Comments

 

racheltayse said:

My husband Alex handed over the checkbook well before we were even engaged. I have a distinct memory of finding an almost-late bill at his apartment when we were dating and making him drive to a place where we could pay it while I wrote a check on the way. Needless to say, we have joint accounts now and though he has the password to the online account I doubt if he's used it in the last month!

June 18, 2013 3:13 PM
 

haverwench said:

We have a pretty standard joint system: joint checking and savings, two shared credit cards, and I handle all the finances. (We also have individual credit cards from our single days, but that's mostly for the sake of our credit scores.) However, back before we were married, we had a slightly unusual system: we had separate accounts, but we still shared our expenses. This started back when we were dating long-distance, and we decided that it was only fair to split the cost of travel expenses so that money needn't be a factor in deciding who should visit whom. So we'd keep track of all our travel costs for each trip (plane ticket, airport parking, etc.), and the non-traveling party would write a check for half the amount spent. Later, when we moved in together, we expanded this system to cover all our household expenses. We kept a sheet on the refrigerator, divided into two columns (one for each of us), and whenever one of us spent money on anything we would both use (like groceries or the phone bill), it would go on the sheet in the appropriate column. Then at the end of the month, we'd total up the columns, figure out the difference, and whoever had spent less would write out a check for half the balance. This system got us in the habit of keeping track of expenses--so after we got married and merged our finances, we just combined the two columns into one, in which we both record our expenses on a day-to-day basis. Only now, instead of just adding up the expenses at the end of the month, I put them all into my budget spreadsheet so we can track our spending in different categories. Ooo, I just love *lists*!

June 18, 2013 5:18 PM
 

frugal_fun said:

Random thoughts -

-There's no reason why you couldn't have 2 "his" and "hers" joint accounts, especially if you're Money Czar. :) It would save minor hassles with the bank and possibly major headaches if either one of you were incapacitated for a time.  It would create the legal situation that you're defacto created anyway. In other words, don't change a thing of what you're doing other than considering adding each other's names to the accounts for emergencies.

-Everything we have is joint, but we don't use debit cards to pay for things. We pay with joint credit cards that give us really good cash back. I pay every week from the joint checking to keep the credit card under control. (Thanks e-payments!)

-I love playing accountant, too!! I have no idea why, but I'd play "banker" all the time when I was a kid. Guess who was elected Money Czar?

-I think why this is so controversial is because people's image of what constitutes a good marriage is different. We've all met a married couple or two that keep separate accounts, no kids, take separate vacations and/or don't seem to spend a whole lot of time together. I will admit that I somewhat wonder about those couples, because that doesn't sound like a good marriage to me.  Ah, well.

June 18, 2013 5:59 PM
 

bhavyacarson said:

We have a pretty standard joint system: joint checking and savings, two shared credit cards, and I handle all the finances. (We also have individual credit cards from our single days, but that's mostly for the sake of our credit scores.) However, back before we were married, we had a slightly unusual system: we had separate accounts, but we still shared our expenses. This started back when we were dating long-distance, and we decided that it was only fair to split the cost of travel expenses so that money needn't be a factor in deciding who should visit whom. So we'd keep track of all our travel costs for each trip (plane ticket, airport parking, etc.), and the non-traveling party would write a check for half the amount spent. Later, when we moved in together, we expanded this system to cover all our household expenses. We kept a sheet on the refrigerator, divided into two columns (one for each of us), and whenever one of us spent money on anything we would both use (like groceries or the phone bill), it would go on the sheet in the appropriate column. Then at the end of the month, we'd total up the columns, figure out the difference, and whoever had spent less would write out a check for half the balance.

June 27, 2013 2:47 AM

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