Should You Merge Finances or Keep Them Separate

Should You Merge Finances or Keep Them Separate?

Being married may sound like a dream come true, but in reality, it is a difficult task. Nobody tells you what to expect. You may have witnessed your parents’ marriage or perhaps other people’s marriages, but it is still hard to know what rules you need to abide by.

One example is finances. Many couples merge their income into a joint account. They use that account to pay bills and deposit paychecks. But is this the right thing to do? Should you merge your money or have separate bank accounts?

People are often given conflicting advice about this topic. However, a recent study shows that merging finances can actually be better for the marriage. It offers a source of protection for the relationship. It makes the marriage happier overall and prevents petty behavior such as scorekeeping. You will not be consumed by who paid for what since you will both be contributing to the joint bank account.

However, it is best to do what works best for you and your unique relationship. After all, money matters are a top cause of divorce. So if you are wondering if you should merge your bank account with your spouse’s or keep your money separate, here are some advantages of both options.

Merging Bank Accounts

Studies show that joint bank accounts promote togetherness. On the other hand, couples who kept separate accounts experienced a decline in relationship quality over time. Couples who merged their finances did not experience this decline.

The main reason for this is that those with joint bank accounts saw improved financial harmony. Overall, they saw less conflict and higher satisfaction, since both partners are contributing to the bank account. Merging money into a joint account promotes unity and togetherness. It eliminates the dynamic of “your money” versus “my money, so there is less resentment.

Another reason for this may be that having a joint account generally makes life easier. You use one bank account to pay bills, so you’re not wondering who is paying for what. There is less hassle involved.

Having a joint account also allows you and your partner to save up toward shared goals. Need a new car? Want to go on vacation? Having one account where you deposit all your money makes the process easier.

Most importantly, having a joint account fosters communication between the parties. When one person wants to make a large purchase, they will need to discuss it with their spouse – or they should, anyway. By having discussions about money, it can help reduce conflict. It can also help the parties understand each other’s financial goals and priorities.

Keeping Finances Separate

However, merging finances is not all sunshine and rainbows. It can be messy, so it is not the right option for everyone. There are some situations in which it may be better to keep money separate.

One prime example is if you have premarital savings. Anything you acquire before marriage is not subject to split in a divorce, so why give your spouse access to it? This is especially true for inheritances. Even when you are married, your spouse has no claim to it. But they do once you commingle it, or put it into a shared account.

If your spouse has debts, then you may want to hold off on a joint account. That is because debts may be subject to garnishment. What this means is that your hard-earned money could be levied and used to pay for your spouse’s debts. This could lead to resentment, especially if you are the breadwinner and your income is being used to pay for your spouse’s bad money habits.

Speaking of the breadwinner, those who make much more than their spouse may benefit by keeping their finances separate. They need to be fully on board with the fact that they will be paying for most of the bills and household expenses.

If you and your spouse have different spending habits, then having a joint account may not be a good idea. You may not like the idea of your husband or wife spending all your hard-earned money and then realizing you will not have enough to cover the rent. Make sure you and your spouse are on the same page financially before deciding on a joint account.

On the Fence?

Should you merge your bank accounts or keep them separate? While many couples do merge them, it will depend on your unique situation. Those who are engaged or newly married may be uncertain about merging their finances. They must have conversations to understand the pros and cons of different bank account structures.

Have a conversation with your spouse about what will work best for you. You should be able to strike a balance between togetherness and autonomy. You can employ strategies such as having a joint account with separate credit cards or setting spending limits. Or you can have multiple bank accounts.

Set financial date nights where you and your spouse can discuss financial issues. This is a good idea whether you are newly married or have been married for many years. That way, you can see what structure works best for you.

Seek Legal Help

Money is one of the top causes of divorce. You and your spouse should decide how to best handle it to prevent arguments.

When financial issues ruin a marriage, Broward County divorce attorney Scott J. Stadler can help. Contact us right away for help navigating the ins and outs of divorce. To schedule a consultation, call (954) 346-6464 or fill out the online form.