Although I am a big supporter of having joint accounts with your spouse, I won’t deny there are downsides. Currently, my husband and I use Charles Schwab for most of our banking and investment needs.
We opened that account when we moved out of the country because Charles Schwab charges no foreign transaction fees and refunds all ATM fees. They also have excellent customer service and were able to help me with getting my paycheck deposited and a laundry list of other issues as we tried to navigate the tricky waters of international banking.
Although joint bank accounts inspire teamwork and openness in marriage, my husband and I definitely had some tense moments over the last five years of banking together.
1. Analyzing Each Other’s Purchases
One of the most common reasons men and women want their own bank accounts in a marriage is because they want the autonomy to spend as they please. Early in our marriage, before we had regular money dates or discussed our financial goals, I frequently went through our online accounts pointing to various charges and asking my husband why he made them. After several months of this, he was scared to make a purchase at all, not knowing if I’d point it out or not. Over the years, we’ve remedied this problem by having our own cash spending money and also starting a rule that you only have to ask the other one about a purchase if it’s over $50.00. That way, I overlook all the little Starbucks charges and he overlooks all the small updates I make to my business.
So, depending on your upbringing or the personality of your spouse, having this oversight can be difficult on a marriage, which is one of the reasons I’m counting it as a downside of having joint accounts.
2. Difficulty in Gift Giving
A week before Mother’s Day this year, my husband told me to look out for any packages addressed to him. He didn’t want me to see the return address because it was a Mother’s Day present. I asked, “Is it from an Etsy seller?” and he was so disappointed.
Technology and our joint banking accounts ruined a little of his surprise. My Mint App (one of many financial tools I use) already told me he spent money at Etsy. I assured him that Etsy was a pretty big range and that I wasn’t disappointed at all, but it was more about the principle of the matter.
This has happened several times in our relationship, to the point where we tell the other one around Christmas time to not look at our account for a few days, which isn’t good either. Many people have suggested that we simply buy gifts with cash, and although that works at times, we both prefer the convenience of online shopping.
3. All Your Eggs in One Basket
In 2005 my family’s life completely changed after Hurricane Katrina blew its way through our town. It was so hectic after the storm. Banks were closed, ATMs weren’t working, and it was difficult to do anything that required using local banks. Everything was underwater. My mom was able to call an open branch of her bank and stop the large check she just wrote for my student housing expenses at my college (which was by then totally closed because of the storm.) I remember how stressed they both were.
Having a joint checking account and putting all your eggs in one basket can be detrimental in an emergency or if your bank has a breech or some other security issue. Spreading out your accounts and your money in different banks and different accounts provides a layer of security that you can’t get with just having one main joint account.
My husband and I feel comfortable banking with Schwab because it’s such a large company but for an extra layer of security, we do have separate accounts in Smarty Pig, an online high yield savings account, which does not allow joint accounts. So, if you do like having joint accounts, you should know that some banks are better about allowing joint accounts than others.
It’s All About Communication
Really, when it comes to joining finances with your spouse (or not), it all comes down to communication and trust. I know many couples that are happily married with joint accounts because they have to work together on all of their money decisions. I also know other couples that are equally as happy with their separate accounts because they trust each other to make wise financial choices and feel like they have a sense of independence.
Whichever path you choose, just remember to have regular financial check-ins to see the status of your combined net worth so you know how far you have to go before you can reach financial goals and ultimately retire.