If you live with your significant other, you have probably considered opening a joint bank account at one point or another. Or maybe you haven’t because the thought of sharing money with your SO gives you too much anxiety. I get it — just take some deep breaths and let’s look at this logically.
I’m currently in a relationship of 10 years, so I’ve had a lot of time to think about this topic. My boyfriend and I chose to open a joint bank account that pools all of our finances, but there are lots of options when it comes to joint accounts. Maybe you’d rather keep your personal accounts, and open a separate joint checking account for joint expenses instead. No matter which route you choose, opening a joint bank account comes with pros and cons.
Pro: It’s Much More Convenient
Keeping track of shared bills becomes much easier when all of your expenses are combined into one account. All your bills can be paid through one account, and you only need to remember one number and one account when something is due.
I’m also a big fan of manually keeping track of individual charges because banks often fail to add pending charges, which can lead to over drafting — an easy and expensive mistake. Since my boyfriend and I share one bank account, it makes it easier for us to track all of our bills and expenses since we’re only looking in one place.
Of course, that doesn’t mean you can’t keep your own personal bank account for personal expenses and bills. If you have your own credit card bills or student loans to pay off, then having a shared account for joint expenses just makes it easier to budget out your money. After you’ve paid your living expenses, all the money left is yours. Whether that means being responsible and paying off debt, or treating yourself to a new pair of shoes — that’s up to you.
Con: It Requires Constant Communication
In an ideal world, you and your significant other would have no issues communicating — but we all know how that works out. And even if you think you’re good at it now, talking about money is a whole new ball game. Keeping track of your finances means both parties need to tell the other how much they’re spending at all times to make sure you’re not both spending money you don’t have. Trust me, a simple: “I’m paying the phone bill today” is infinitely easier than the hairy conversation that results from neglecting to communicate and causing your SO’s card to be declined in the grocery checkout line.
I’ve been there, and I fought it at first. I didn’t like telling my boyfriend my every move — who would? But I got over my pride after our third overdraft (whoops!), and now we’re like a well-oiled machine and have avoided fees for years.
Pro: You’ll Pay Fewer Fees
This pro only applies if, like me, you forego your separate accounts to share one joint checking account. We switched to a credit union to avoid unnecessary bank fees, but we still couldn’t escape them all. Only paying the fees for one account definitely helps, though.
Some banks have a minimum balance that must be maintained in order to avoid charges. For example, Bank of America charges a $12 to $25 monthly fee, depending on the type of account, if you don’t maintain your minimum balance or have a single direct deposit of $250 each month. By pooling your money together, you can either avoid the fees altogether or save money by only paying the fee once. This also goes for checkbook charges, fees for opening the account, and other necessary charges.
However, if you both still have your own personal accounts, you will still need to maintain a high balance or make direct deposits that are high enough to waive the monthly fee. Otherwise, you could end up paying more for that additional account.
If you shop around, you can probably find a bank that won’t charge you fees. But it’s still something to consider for some rural areas that only offer one or two banks. Pro tip: make sure to research banks and credit unions.
Con: It Could Cause Fighting
Even if you think you’re the strongest couple in the world, opening a joint bank account can (will) lead to some disagreements. Most commonly, a fight may ensue if your partner doesn’t understand why you need to spend money on a new monthly expense that should be shared between both parties.
After living in a bad area, I felt like we needed to invest in a security system for our home. My boyfriend was against it and thought it was unnecessary. Cue the fighting because he had a hard time understanding why we needed to add to our shared expenses.
However, you can avoid at least some of the arguments by having your own personal account and a joint checking account. Then, your significant other can’t judge you when you get Starbucks for the third time this week (fine, day — I have a weakness, okay?).
Pro: It Promotes Equality Between Couples
Whether you slay and make more than your partner, or vice-versa, equality in a relationship is important. Being in a relationship is hardly about being the “breadwinner,” but it can be hard if you feel like the dependent (or if you feel depended on). A joint bank account is a fair way to share funds even if the income isn’t equal.
Even if you opt to keep your personal account, joint accounts allow you to either split the bills down the middle or work out how much each will contribute based on your income level.
Con: Gifts Can be Nearly Impossible to Purchase
Big or small, surprising your SO becomes slightly more difficult with a joint account. Say you want to pick up his favorite dinner on the way home. Since food falls under the “shared expenses” list, you’re either forced to pay for it yourself or risk the charge popping up on his phone and the surprise being ruined.
Since my boyfriend and I share one account, every holiday and birthday requires sneak tactics. I have to figure out a way to buy something without him noticing. I usually get him something video game related, which requires me to go to a game store. Later that evening, “Why is there a charge from the game store?” Cover blown!
Pro: You Can Earn Rewards Much Quicker
Did you know you can get joint credit cards? I didn’t, and I realized it helped us gain points a lot quicker and build our credit score equally. I mean, everyone knows that the best stuff costs the most points, so it doesn’t hurt to have two people earning rewards by using the same account or card. You could also use a credit card to make major purchases and then pay them off using the joint bank account. Either way, more points means more travel and higher point totals.
Con: Breaking Up Becomes Much More Complicated
No one wants to talk about a good relationship going sour, but it’s always possible that a couple could split. At that point, the couple would need to break up their joint bank account immediately, but this can be difficult if one side is uncooperative.
Most banks allow you to withdraw the money from the joint bank account, allocate it to yourself and the other person, and then get a new bank account under your name. It’s a stressful time and owning a joint bank account can potentially make it harder.
However, keeping your personal account makes splitting up a joint account much less complicated. You wouldn’t need to go through the hassle of opening a new account — just withdraw your portion of the funds and deposit it straight into your personal account.