Wednesday, December 10, 2008

Joint or Separate Bank Accounts?

My wife and I have always maintained separate bank accounts. It never really occurred to us to do all of our banking with joint accounts. I’ve often wondered what it says about a couple when they make one choice or the other.

It’s not that I have my money and my wife has hers. Since we were married it’s all been our money. If I happen to be short on cash, she’ll just give me $100 from her wallet without keeping track. If her bank account gets low for some reason, I’ll just write her a cheque.

Sharing a bank account feels sort of like sharing a toothbrush to me. It can be done, but you’d have to be in quite a romantic mood to think that sharing a toothbrush is a good idea. It just seems like a pointless hassle to balance a chequebook when two people are making withdrawals. Misunderstandings with joint accounts must lead to the occasional bounced cheque.

It’s possible that having separate accounts but not really keeping our money separate is only possible because we both tend to be frugal. Maybe other couples have to keep track of each other’s spending. A joint account might help with monitoring each other. Alternatively, having “her money” and “his money” is probably more easily done with separate accounts.

Perhaps getting a joint bank account shortly after getting married is a symbolic gesture of commitment like wedding rings. If you’re not sure what to do and you want to be like other people, a joint bank account seems like the right choice.

There are probably some good reasons to have joint accounts. My wife and I actually have one joint account for a technical reason to do with transferring money years ago, but I think of it as hers and never touch it. Does anyone have any thoughts in support of joint accounts?


  1. Joint account for common items - Home bills, groceries, etc.. Separate accounts for your own personal use/savings/investments.

    Overdrawing shouldn't be a problem if you figure out how much your monthly common expenses are + cushion, and you each contribute 50% to the joint account.

    It also serves to more easily keep track of monthly expenses.

  2. My wife and I have 1 bank account. I handle everything and my wife likes it that way. It works great for us. I would never consider having it any other way. I have to note though that we both have the same type of habits and attitude toward money. Obviously because we are married we trust each other fully.

  3. Astin: It sounds like you and your wife have the discipline to use the joint account only for the agreed upon expenses.

    MG: When your wife buys things, she must communicate the amount spent to you in some way. Or maybe you maintain enough float that you can afford to just see what happened periodically?

  4. We have a joint bank account that my wife manages, and I have another account for my own personal spending money. For anything I buy, either I've discussed it with her ahead of time, or I'm willing to buy it from my personal money. Things for which I think I should be reimbursed go on one particular credit card (which gets paid in full every two weeks) partly to record the purchases, partly for the insurance and rewards, but mostly so I can avoid overdrawing the account without having to keep a float in there.

  5. Our bank accounts have always been joint. I do have one bank account in my name alone where I keep money for some of the kids' expenses.

    I organize the spending plan, pay the bills and reconcile the accounts. My husband likes it that way and so do I (I have a higher AR factor than him when it comes to money). He has no interest in the micro-management of our household finances. Once we agree on goals and where we want to direct our money, I take care of it. We are both responsible for strategy, I am responsible for implementation.

    He likes routine, so he generally withdraws the same amount in cash each week for himself. If he needs more, we keep enough float that it's not a problem.

  6. Bah, this was the topic of my next Potato Wedges column -- you beat me to it!

    I like your toothbrush analogy, BTW.

  7. Just like MG, my wife and I only have one bank account, which we hold jointly. We took this decision when we realized that we were both keeping a substantial balance to avoid paying banking fees. The transition was not complicated at all, since we have always been taking together all the important decision regarding our household and respective personal finances. The only issue we had was the lack of "privacy", which we resolved by keeping separate credit cards (although we see the total amount when the bill gets paid, the details of the casual transactions remain personal).

  8. Based on this small sample it appears that most couples use joint accounts for various sensible reasons. I suspect that I've mostly heard from people who manage their money well. There must be people out there who have bank account strategies in place to monitor a spendthrift spouse.

  9. We put everything on credit cards. Makes it much easier to manage the bank account. The only drawback is that my wife can not really buy me anything and know that there is now way that I will investigate it. In reality I don't really look that closely at her credit card statements. Once again, I think it all comes back to trust.

  10. We only have joint savings accounts, and like yourselves don't keep track of the few bucks that get transferred back and forth. My husband really isn't frugal at all though. I agree with you about the "occasional bounced cheque" risk, but I also don't want to be discussing or looking through every last pack of smokes or gift for his mum my husband buys. I don't have time for that, but he's a big boy anyway and doesn't need to be monitored.

  11. Mostly joint accounts, but I have my own set of accounts as well. This is done for taxation purposes -- arcane CRA doesn't allow income splitting, so investment capital comes from my pocket ("untainted" by my husband's income).

    The joint accounts make paying bills and budgeting in general easier. We both take equal responsibility in handling our finance, and there is no clear definition of who-does-what (which is the way we tackle most things).