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Newlyweds: What To Do if Combining Bank Accounts Just Isn’t Working.

Newlyweds: What To Do if Combining Bank Accounts Just Isn’t Working.

February 03, 2022

It’s Valentine’s Day! Love is in the air. At Summit Wealth Group, we want to contribute to long and lasting relationships. So, in that spirit, we want to address a point of contention for many couples (specifically for newlyweds): How to make it work if combining bank accounts is causing problems.

In a perfect world, when couples join as one, everything in their possession combines, including income, savings, and bank accounts. What’s mine is yours and what’s yours is mine. The reality is some couples have a more challenging time with this than others. Let's look at three reasons why this can happen:

Reason #1 – Everyone has a unique money personality

Some people are savers. Some are spenders. Some are diligent budgeters, and others check their bank statement once a year come tax time. It can be frustrating when two people with opposite money personalities get together and try and combine finances.

Reason #2 – Spending priorities vary significantly from person to person

He has his hobbies; she has hers. Early in marriage, you get a deep understanding of what the other person prioritizes, reflected in their spending. This can lead to some hard conversations if the things your spouse is prioritizing interfere with what you are prioritizing.

Reason #3 – Income or savings differences can alter expectations.

Different incomes bring about different standards by which each person lives, and savings account sizes can bring peace of mind or anxiety depending on how much has been saved.

So, what do you do when two very different people try to combine resources? Here's a quick suggestion that might help alleviate the stress.

First, a disclaimer. Understand that this is a temporary solution. The goal is to work toward combining your finances, even if it is impossible to start. Reaching a point where bank accounts and incomes are shared is proven to be better for long-term success and trust in a marriage.

TIP: Have each spouse’s income direct deposited into separate checking accounts. Then open a third checking account that each spouse must “pay into”.

Make a list of all your non-discretionary expenses. This means everything you and your spouse need to survive—groceries, mortgage, utilities, car payments, etc.

Total it all up and let’s say, for example, the total comes to $5,000 / month. Those expenses will all be paid out of that combined checking account. If you and your spouse have different incomes, we suggest paying into it in a way that is proportionate to your income. For example, if the wife makes $6,000 / month and the husband makes $4,000 / month, the wife would contribute 60% of the $5,000 to the combined bank account, or $3,000 since she makes 60% of their combined income. The husband would pay $2,000 into the combined bank account every month.

Now that you have taken care of your combined living expenses, the rest of the money in each person’s account is theirs to prioritize however they wish.

This is not a perfect solution. A lot of power comes from prioritizing discretionary expenses together, sitting down and having conversations about savings goals, vacations you want to save up for together, giving goals, and eventually retirement goals. This is much easier to do when the bank accounts are combined. But remember, this is temporary while you get your footing to minimize the tension that can already be high early on in a marriage. As you learn each other, you are already getting used to what it will take to live off your combined income. 

One last tip if you decide to use separate accounts (and this should go without saying) is to provide your spouse with your bank login info. That helps build trust and accountability, which is the foundation of any healthy relationship. 

We hope this helps and cheers to you and yours!