Some people say, “It’s always better when we’re together,” but does the same apply to our money?
Being in a relationship is exciting. Whether you’re in your twenties and in love for the first time or in your fifties and getting back into the dating scene, it’s nice to have a significant other by your side. Whatever stage in a relationship you find yourself in, an issue seems to always arise when it comes to finances.
Let’s be honest, no one really likes talking about their finances. The conversation can feel awkward, inappropriate, and extremely uncomfortable at times. However, these discussions are very important, especially as your relationship becomes more serious.
A big concern is whether or not you should have joint bank accounts with your partner. There really is no clear winner when it comes to the battle between single versus joint accounts. The answer lies within the personality traits you possess and the relationship you have with your partner.
To help you make the best decision for your specific romance, here are some things to keep in mind.
Choosing to combine finances is a very traditional approach, suggesting a “What’s mine is yours” mentality. Joint accounts are beneficial in several ways, but they also have some consequences.
First off, having joint accounts promotes trust in your relationship. Since all of your money is in one place, both parties must be responsible with their spending. Joint accounts eliminate secrecy that may surround money and can let you be open about your spending.
If you’re more prone to make impulse spending decisions and risky investments, it may be wise to join accounts so your significant other can keep you in check.
Joint accounts also let you see the bigger picture. You have a better sense of how much money you as a couple have because it’s all stored together. Too many bank accounts can lead to confusion, and make it difficult to track spending and areas of financial stress.
On the downside, any relationship always runs the risk of ending. In the event that you ever break up, splitting the finances can be messy. No matter how many positives, we always suggest waiting to join accounts until your relationship has hit a serious, mature level.
If you’ve been handling your finances, paying your bills, and supporting yourself on your own for most of your life, then holding individual accounts may be a better route for you. Individual accounts create autonomy, and if you’ve had financial independence all of your life, then it could be hard to give up this luxury.
Separate accounts can also help you avoid money battles. You can spend your money how you like and not have to worry about your partner’s opinions.
Going this route also encourages financial literacy. If or when the relationship comes to an end, you will still be able to handle your financials independently and have the skills to survive solo.
But, who said you can’t have the best of both worlds? There is no why reason why you can’t have both joint and individual accounts. Consider having a joint account just to pay the bills. Then have your own personal accounts for spending money. This compromise combines the advantages of both scenarios while eliminating some of the negatives.
When it comes down to it, you and your partner should recognize your individual spending habits and financial philosophies. From there, you must have a discussion about the best decision for your unique situation.
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