Before combining your cash, it’s important to have an open conversation about money. How you spend and save, and what you expect from each other. Being upfront is key, and it will help you to develop a game plan. Some conversation starters:
- Will you deposit equal amounts?
- What will you use the account for - paying bills, loans, rent or as an emergency fund?
- Withdraw whenever, or get an allowance?
- Will you combine everything into one, or keep separate bank accounts?
- Will both of you have full authority to operate the account, or will both of you need to give permission to do certain things?
Set ground rules. Kick goals.
It’s important to agree on the basics when it comes to money - spending and withdrawal limits is a good starting point (it may minimise arguments about money later down the track). And set collective savings goals with a reward for both when you achieve them.
All or nothing? Not necessarily.
It’s likely one of you will earn more than the other. To make things fair, some couples deposit a ratio of their earnings into their joint account. For example the highest earner pays 60%, the other pays 40% of theirs.
This approach enables couples to keep separate bank accounts rather than pool their entire earnings and savings into one, giving both a stronger sense of financial freedom.
Keep track. Together.
The account is in both your names so you’re equally responsible for it. Making assumptions that the other account holder has paid the rent, for example, could trip you up. This goes back to agreeing to things upfront. You might want to consider automating regular payments to make things easier.
Tackling existing debt.
You may have commitments outside your current relationship e.g. child support or loan or credit card repayments. Talk about whether this will be taken from your joint account or handled individually.
Be careful with credit.
If your relationship ends, you are both liable for debts that remain in your names. If one of you starts missing payments, it will impact on both of your credit ratings. Something to be aware of.
Combining your finances is an important step in a relationship. If you and your other half are in it for the long haul, then getting a joint bank account could really work for you.