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Wednesday, June 24, 2015

Should Married Couples Have Separate Checking Accounts?

How's it goin' all?

I got some deep marriage wisdom for you, from a man that has been once divorced, and is now happily married.  No...I don't have a marriage expert as a guest.  Yours truly will opine today on the greatest money debate of all time: Should married couples have separate checking accounts?

As always, I Googled this question and came across some excellent articles.  The Six Financial Mistakes Couples Make by Aleksandra Todorova, was by far the most comprehensive, focusing on all money related matters (debt, investing, emergencies, e.g.) during a marriage.  Bankrate.com's, Married with Separate Checking Accounts, has the top spot on the search page.  Though I find both of these articles useful, they both make a fundamental mistake: Placing the topic in the realm of what's practical and logical for each individual.  Well, duh, Carlos, that's how it should be!  Personal experience tells me that (placing the individual's needs first) should be secondary, not primary.

There are three ways couples, once married, use checking accounts.

A) One checking account for the couple.  All checks go into this one account.  Both individuals access the account.
B) Two checking accounts.  Each individual has their own bank/bank checking account where they deposit their money.  There may be some shared access, ex: Here's my debit card, go buy...my pin is...
C) Three checking accounts.  Each individual has their own, plus the couple creates a "joint" account where they each deposit part of their income for communal expenses.

Now, Bankrate.com's Heather Larson gives the following reasons as justification for keeping checking accounts separate:

  • Sense of autonomy as couples adjust to the interdependent lifestyle of marriage.
  • Prevents arguments over money and gives both spouses a feeling of fairness and independence.
  • Makes dividing expenses much easier when spouses contribute a percentage of income to joint expenses that matches the percentage of income they bring to the table.
  • Keeps your spending spouse's debt on their credit score card, not yours.
  • To keep one person's spending habits from affecting the other.
  • Brings meaning to gift-giving.
  • No one person dominates the marriage by dominating the joint money.  No one person will become the "parent," wielding the money power to make the other the "child."
  • Separate accounts facilitate the division of assets and the expenses of a divorce.    
It's absolutely comical seeing the last bullet of this article mentioning divorce as a justification for keeping separate checking accounts.  Why?  Because that's exactly where you and your spouse are heading if you follow this advice.  Bold statement?  Let me explain.

Marriage should be as simple as possible.  This article by Bankrate.com adds complexity to marriage, even though it attempts to keep money out of the marriage equation as much as possible.  I will tell you right now that it is impossible, and no practical or logical advice will ever prevail over a clearly emotional subject in an emotional set-up such as marriage.

My first marriage 

Respect.  That's what was missing in my first marriage.  I realize now that I had married the wrong person for me.  She had little to no debt.  Her income was slightly more than mine (we were both teachers).  And though we initially started our marriage with separate checking accounts, we even adjusted to opening one joint checking account as a last ditch effort to stop arguing over money.  Money should not have been a source of arguing per Bankrate.com's justifications.  But it was nonetheless.

When it came to our joint debt, like our 2nd mortgage on our townhouse in San Jose, we would argue about how much to pay, the minimum or more; if more, how much more.  When it came to date nights, we would argue about whose "turn" it was to pay the bill.  I kid you not!  So much for gift-giving.  Even with our separate checking accounts being used to buy things each of us desired, we would still scrutinize the expenses.  I have to admit, the latter was mostly me, worrying about our joint financial goals not being met with someone's "frivolous" purchases.

When you marry the wrong person, money will be first to let you know it.  Intimacy is a beast that hides in a cloud until the last days of your marriage.  When I look back at my first marriage, and wonder why I argued so much over money (and sex later) with my ex-wife, it comes down to one thing: lack of respect.  Yes, I "loved" my ex-wife, but I wasn't "in-love" with her.  What was worse, however, is that I never saw her as my equal.  I never submitted to the sanctimony of marriage with her being someone who is not only an individual, but a part and extension of me.

After my divorce I made this very important decision: If I was to marry again, this person would have to command all of my love and respect, AND dethrone money from the queen's chair I had put it on.  Where do you have money sitting currently?

High net worth people get prenuptial agreements.  Do us all a favor: Just don't marry if you "have to" get a prenuptial arrangement.  You are not okay with that person, who should be your soulmate for life, getting any of what you've earned over your lifetime.  There's nothing wrong with this.  Keep dating until you find the person you would be happy to give all of your money to in the event of your passing, or some of your money to, in the event of a divorce not having its origin be money.

If debt is a problem for you during dating, don't marry!  You cannot start a marriage mentally fit with a problem already on the table.  If the debt is small, wait for the person to pay it, or move on.  If you've found the "right" person, I can assure, they could have all the debt of the world and you would still marry them.  What comes after, of course, would be incredibly hard, but knowing the challenge, you'd still be first to take the leap forward into coupledom.

When I met Jessica, my true love, she had creditors calling her everyday, asking for payment on her various unpaid credit cards, owing nearly $10K from discretionary expenses on high fashion.  The funny thing was, I wasn't bothered by it.  It was surprisingly insignificant to me, and that's when I first knew I was on to something, so to speak.  She would later impress me by consolidating her debt, and getting rid of it prior to our engagement.  She had made a powerful discovery about herself and money, and I hadn't gotten in the way of her empowerment, mostly being a soundboard for her during this personal trial.  Little did she know I would have married her debt, and gladly taken on the potential for subsequent arguing, albeit as a unified body.  Soon as we got married, we joined our checking accounts.  Neither one of us objected.


Till death do us part.


Do we still argue about money?

Jessica and I argue about money all the time, like most married couples.  But here's the difference, we both know, money will NOT separate and divorce us ever.  We argue about money without fear that the other person is going to turn around and get divorce proceedings started.  I tell you, it is refreshing.  A typical argument goes like this:

Carlos on the phone or texting, seeing the online checking account debit: Jessica, what you buy now?
Jessica: I bought X.  It was only $.
Carlos: But you don't need X.  You have plenty of Y just like it.
Jessica:  Yes, I do.  Y isn't working anymore.
Carlos: But we can't afford it right now.  We have to do Z!
Jessica: Yes, we can!  Stop worrying about money.  Why are you constantly looking over the account?  
Carlos: I don't know...I'm anal like that, you know.
Jessica: Yes, honey, I do.

Over the years I've gotten a lot better about ending my silly back-and-forth arguing over money with Jessica.  Why?  Because I know there is no winning for either of us.  If she's wrong, she will be upset.  If I'm wrong and argue incessantly, she will be upset.  Pointing out when we are wrong is obviously necessary, but overdoing it is not, especially since it is not a "divorce" offense.

Marriage is an undeniably difficult commitment.  For there to be respect, each person needs to give 100% of themselves (their love, attention, etc.) to the other person at all times.  You won't avoid arguing over money, but perhaps you will a truer reason for divorce: infidelity.

I know I'm no expert, but this is my take and I'm sticking to it.  What say ye? 

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