How Should Married Couples Manage Their Bank Accounts?
The most referenced blog post I have written is still a question that comes up with clients, so I decided it is time for a refresh.
Couples often ask me how best to manage their bank accounts. It seems that lots of couples, from newlyweds to longtime loves—and everyone in-between—wonder about this topic.
There is no textbook right or wrong way for couples to manage their bank accounts. Different things work for different people, but the two most common ways I see are:
A) Spouses keep their money separate from one other and decide on who pays which bills, or
B) They dump all the money into one account and hope nobody spends too much.
However, there is a third option which really works for me and my wife, Susan.
We have three joint bank accounts. One is the “family account” and both our incomes are deposited there. We use it to pay family expenses, like daycare, groceries, and the mortgage.
Both of us have different things that we like to splurge on but the other sees it as frivolous. For example, I tend to eat out for lunch more often than she thinks is reasonable. To reduce potential conflict over what we buy, we each have our own checking account and each of us gets a monthly allowance. And you thought allowances were only for kids!
I pay most of the family bills each month, and when I am paying the bills, I transfer our allowances from our family account to our individual accounts. We have a rule that we cannot tell each other what to--or what NOT to--spend our money on.
If we both decide we need something and agree it is appropriate for the family to purchase it, we purchase it from the family account; however, if we do not both feel the family should purchase it, then one of us can buy it with their allowance. Like so many coming out of COVID we decided that our back yard space needs an upgrade. We determined together that the family can afford to have new composite decks put around our pool.
At the same time John Marshall, Amelia and I have been enjoying our new scout skills with flint and steel, so I want a fire pit. While Susan will enjoy the fire pit it is not a priority for her, so I used my allowance (and some sweat equity😊) to install a one. Since it is permanent, I did get her to agree to the instillation, but she didn’t get involved with the cost since it didn’t affect her or the family accounts.
This system not only prevents a lot of conflict, but it has another benefit. As people get older, bill paying can change and how to handle bank accounts adapts accordingly. This can be scary for a lot of people, especially those who have not been the primary bill payer for years. Since Susan handles her own bills, bank accounts and credit cards, I know that if something happened to me, she knows how the system works and would have no problem taking over for the family.
Our system may not work for everyone, but it does prove that with a little creativity, handling bank accounts does not have to be a sore spot between couples.