Pete the Planner was dead-wrong for years

I was wrong. I’m sorry. Did I cause damage? No. But I probably added stress to relationships. For this, I’m sorry.

Allow me to explain.

It seemed like an innocuous answer to a very common question. The question: should married people have a joint checking account, exclusively. The answer: absolutely. My answer of absolutely was based on trust. I have long felt that money in relationships is a manifestation of trust. If you don’t trust your spouse with money, then you don’t trust your spouse. Simple, right? Yes, but over the last few years I have found that the absence of a joint account has nothing to do with the potential absence of trust.

I had misdiagnosed a problem. Married people with separate accounts ARE NOT a beacon of mistrust. In many instance separate accounts are a stress management technique. Oddly enough I tripped into this epiphany. Mrs Planner and I have had separate checking accounts for the last three years. We didn’t intend for this to happen, but when we set out to switch banks a few years ago, we never fully completed the transfer. Thus we had two different checking accounts. We certainly don’t have financial trust issues, so why would we bother keeping money separate? The money is separated, however the owners of the money remains the same. We both own the money. We both have “rights” to the money. Her paycheck dumps into “her” account for our use, and my paycheck dumps into “my” account for our use.

I use “my” account for the mortgage, charity, daycare, groceries, dining, and my fuel. She uses “her” account for the utilities, Target trips, car insurance, life insurance, her fuel, investing, and some other miscellaneous items. The reality is that both accounts are for our benefit. I view my income as “our” income, and she views “her” income as our income. This is enough. There is no need to have one checking account to accomplish this. In the past, I had incorrectly asserted that a joint checking was a must to build trust. The reality is that it’s often easier to split your money into two, and then split the bills into two. We have NEVER had the slightest disagreement about who pays for what.

I’m not asking you to now split off into separate accounts. I’m asking you to find a system that works best for you. I do know what won’t work: my money and your money. Separate accounts start to suck when the money in the account isn’t the household money, but instead it’s for the sole usage of the accountholder. In fact, that operating system will ALWAYS end in disaster. The household money doesn’t always have to remain in the same account, but always needs to be the household money.

So what do you do? Do you have separate accounts or a joint account? Is your system really working well? Let’s hear it in the comments.

26 thoughts on “Pete the Planner was dead-wrong for years

  1. We have separate accounts for his paycheck and my paycheck but we have a joint account where we put money in each month to pay for our mortgage and insurance and save up money for the always unexpected house repairs just to have as some padding. He uses his checking account to pay for utilities and cable, and I use my checking account to pay for the groceries and phone bill. It works because even though we use our checking accounts for different things, they are used for both our benefits and for the things are are invested in together we have money put into that checking account coming from both of us. For our situation it is a good solution.

  2. Hubby and I have been doing this for years – it works for us. Bills are split and after all of that, if you have a little money to play with, feel free to buy a new pair of shoes or something, and the other person can’t say a thing. It’s a nice way to do your part as a person in the marriage, but at the same time, not have the tension of asking to use money for something extra. This really has been a great system for us. Especially since my husbands favorite hobby is golf – if I had to balance that joint checkbook – I would go mad.

  3. We have a joint account for paying all bills, but each have a checking account where we give ourselves a small allowance. We are both extremely frugal, and the personal “fun money” accounts have been an amazing relief, because they give us “permission” to spend a few bucks on small things we want without feeling guilty.

  4. I think that having separate accounts is a fantastic idea. We do it in our household. I cover items with ‘my’ money and he covers other items with ‘his’ money.

    I never have felt like I should tell him what to do with the money he rightfully earns and vise versa. Just because we are a team does not mean I gained control of his money. It is most definitely a stress management technique. We never argue about money. Thankfully, neither of us have poor money management skills.

    We do have a joint savings to save for the future.

  5. In my first marriage, we had a joint checking account. It sucked. He was a spender, I was a saver. Plus he didn’t keep track of anything so I had to constantly try to monitor his spending habits or we would overdraw.

    My second husband and I have separate accounts. It works for us. We pay our own personal bills like credit cards, vehicle (me) and student loan (me, again) and split the mutual bills. I take care of the cell phones, cable and insurance. He pays the electric, water and mortgage (I pay half of that, though, ’cause it’s not cheap!).

  6. We had three accounts, his, mine and ours. No mistrust, just convenience. We put money into the joint account for bills, etc., but then we each had some discretionary money. I liked to shop and Bath and Body works…. he hated that stuff. He thought a bar of Coast soap was sufficient. He didn’t see the few extra dollars it cost, and we could definitely afford it. It just would have annoyed him. I didn’t see how much the little extras he bought for his Harley because it would have annoyed me. I was blissfully ignorant as to what those trinkets cost. Plus, when I wanted to surprise him with a gift, or vacation, etc., he didn’t see the paper trail before I could surprise him. Same went for him. A long time ago, I saw the bill for the long stem roses my first husband sent to me for Valentine’s Day. It sent me into a tizzy. I ruined it for him, and myself, and he never sent me another flower. I sucked the enjoyment for him right out of it. There are plenty of very innocent reasons to have a separate checking account.

  7. Pete – I agree that there is nothing wrong with having 2 separate checking accounts. We do something very similiar what you described. My wife’s pay is depostied into one bank and my pay is deposited into a seperate bank. The reason for this is very similiar to yours. We also split up the bills between these 2 accounts.. What makes this ok is both checking accounts are joint accounts.
    Maybe your original thoughts on this topic might have been along the lines of one spouse having an account that the other person does not have access to. This could get into a strange area, even if the spouse with the individial account insists it is “our” money. I just have to ask “what is the point?”

  8. We started out with separate accounts. He had his bank and I had mine when we got married so we just divided the household expenses into equal percentages. I then switched to an online bank and added him to the account so it would be easier to “pay me back” (now that I am home with our girls while they receive early intervention) for those expenses that get deducted from my account that we don’t feel like changing because I will work again once they are in school (student loans, life insurance, etc). I put other expenses on the joint credit card (gas, groceries, etc.) that we pay off each month. It’s worked great for us but we also knew each other well and knew we both weren’t big spenders or financially irresponsible.

  9. We have both a “Joint” and separate “Personal” accounts (One ofr myself, my wife, my daughter and “savings”). Our paychecks go into the “Joint” account, and our budgeted “allowance” gets automatically transferred out into our “Personal” accounts weekly. We pay our bills out of the “Joint” account and our personal expenses out of the “Personal”. My Wife’s overdraft is set to pull from the “Joint” account, but mine is set to deny overdrafting because I use it for a lot of internet purchases. All of the account technically have both names on them so we can both see them when we log into the bank.
    And no, I don’t trust my wife not to overdraft her account – it still happens about every 2nd or third month.

  10. We’re a little weak on dudes in this comment section, so I’ll throw in an opinion. Pete, I agree with the sentiment of “our money” in whatever system you prefer to apply. I have many friends that successfully pull off the separate model. It doesn’t work for us for a number of reasons, mostly practical, but also philosophical.

    First, the separate model highlights and symbolizes who the higher earner is. That account will always be more full, a larger, bigger pile. When that is associated with one half of the marriage (regardless if you pay more bills) that spouse is (actually and symbolically) the higher earner, more responsible and more liable.

    Second, and confirmed by several of the comments above, separate opens the door to dissolving consideration for your partner’s opinion on your spending. I love to golf too, but I spend on golf what “we” can afford, not what “I” can afford and, for us, the best way to manage this is to pull from one bucket. My spouse supports (that’s probably, too strong) this spending because it makes me happy and doesn’t adversely effect our financial or personal relationship. We have other mechanisms to make sure that we’re being considerate, such as discussing any expense over $100 together.

    Lastly, the math is unnecessarily difficult. Seriously, if it’s not a trust or ego issue, why the heck do twice the work? Why have to think, for new expenses, who pays for it, thereby inherently associating that expense with a person, instead of a pair of humans bound by their undying love?

    Like I said before, I’ve seen the cat skinned many ways (figuratively), agree that married peeps should consider their income collectively, but combined accounts works the best for us.

  11. This is what we do as well. That way he’s not upset when I buy a new outfit and I’m not upset when he buys the latest gadget.

  12. We have been married since 10/10/10 and we have separate accounts (even during dating for 2.5 yrs) and I tell him I am paying the “rent”- which is a monthly amount that is split fairly (not equally- based on our income levels) for all the bills and expenses including the mortgage. He thinks it’s funny when I say I am paying him rent!

  13. We pay all of our bills from the same joint account. However, our budget enables each of us a small allowance for “fun” money. No questions asked. Obviously we trust each other or this would’t work. What it does do, is let me buy coffee/smoothie/clothes without having to hear about it as long as I do not spend more than my budget. He can buy bowties, Scotch, whatever. It also lets us eat out together if we are out of food budget- we will split the dinner bill on the his/her fun money accounts. Many times, one of us will fund a bottle of wine or beers to share from this fund. It really does work for us.

  14. We have always had separate accounts where we each put in our own pay checks, pay for our own fuel, trips to Target, fun stuff. Then we also contribute equal amounts to the joint account. That account pays the mortgage and all household bills. Some months we put in extra to the joint account to pay for something we both want to do, or for a household expense that is above and beyond “normal.”

    It has worked for us for 24 years.

  15. When we got married, I had 3 accounts (check, savings and bad day) she had 2 (check and save). We tried keepig seperate for a bit. Since she moved into my house before we were married, I was already paying all bills, she paid for groceries (I got the short straw). After marriage, she kept her accounts and I kept mine, but I gave her access to mine for everyday expenses. It got to the point where her account was filling up and mine was decreasing. We decided to go down to my 3 accounts, and I manage them all. Seems to work now that her money and my money is our money.

  16. I think couples should do what works for them. As a former teller I am partial to two accounts. I learned so much about our customers when I got to tell one spouse they did have the funds because the other made a withdraw or used their debit card and over drafted. So much was innocent, but still a conversation I had with customers frequently.

  17. This is what we do, too!
    Because I’m paying off business loans and he’s been working 15 years longer than I have (with the same company! while I traveled, got over-educated and started a business…ok, he’s 9 years older as well) I feel he is entitled to spend his hard-earned money how he wants without me having my say (although I do, I can’t help it).

    The tricky part is deciding how much goes into the joint account – a % of each income or a set amount? What is one person makes 3x as much (because of the industry ie. professor vs. social worker) or mom stays home for a one-year mat leave? That leaves one personal account devoid of cash while the other person can still continue spending/living their previous lifestyle.

  18. He cannot be trusted with money. It burns a hole in his pocket, and he readily admits this. He deposits his check in his account, I transfer all but enough for gas and cigarettes to my account, which he does not have access to.
    I write up a monthly budget, and we both have equal say so on it. Any money spent outside the budget by either one of us has to get an okay from the other person first. I make sure the bills get paid.
    We are accountable to each other, but he has limited access to funds. Wish it weren’t this way. I’d rather be married to an adult instead of a big kid, but it is what it is, and I sleep better at night this way.

  19. If one spouse earns more than the other, would this still work? Doesn’t seem fair that the higher-wage earner has more spending money. Glad you are happy with this, but it doesn’t look like you both benefit equally from incoming funds.

  20. Is okay for the spouse who brings home the paycheck to write a check to his spouse once a month? We have been doing this for 10 years. If I run low he does give me more, but I have to ask to get it. I have gone under many time and have gotten fees, due to me not taking or having the time to balance the check book. I have been told he is being controlling by doing this. He has control of all the money since he is working and I am a stay at home mom.

  21. Dawn – Based on some things you mentioned in your comment, it doesn’t sound okay to me. I would disagree that there is nothing wrong with this situation, even if you have been living with this arrangement for 10 years. If you, Dawn, are a poor manager of money, this isn’t a good solution that helps you or your husband.

  22. I agree that it’s possible to have separate accounts and all can be well. But that’s only providing that there is an open dialog about money between you and your partner. As a money coach, I’ve worked with many couples where money issues are avoided and collaboration doesn’t happen. Then, separate accounts can obscure problems and at worst, allow for lack of transparency.

  23. We’ve had separate accounts from the start. I had been married and divorced, and I DID have trust issues from my first marriage. I had to explain to my husband that it had nothing whatever to do with HIM, but that it was MY problem. It’s worked out fine. We work it just like you say – it’s all OUR money. i pay certain bills and he pays certain bills. When you have two people using one account, I think it’s difficult to keep everything accounted for. We’ve kept our accounts separate because it works, and it’s easier than wondering who has spent what.

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