Getting a Joint Bank Account and Making it Work
I’ve mentioned before that M and I are getting married pretty soon (two and a half weeks!) and one of the things that we’ll be doing that is relevant to this site and to personal finance is joining our bank accounts. We’ve already created a joint ING account that simply shows up via both of our existing accounts, so that’s about as painless as it gets. But for the bank account it’s a whole different animal.
First of all, I like my bank (Bank of America) and have had my account there since I was in college (nine years) so I’d like to keep it. Besides, have you seen their new ATM machines that take checks and cash without an envelope? You don’t even need to count the money before giving it to the machine in one big was — it does the rest of the work.
There are a whole bunch of other considerations too:
- Convenience: M doesn’t have direct deposit so right now she has to go to the bank every Friday and deposit her checks. Not convenient. Luckily, there’s a Bank of America in her building so it’s actually more convenient if she comes over to the dark side (We already opened a joint account with them).
- Fees: This has been a real nightmare because some accounts are fee free as long as you promise to direct deposit consistently into the account. Which is fine, I’ll do that, but not until after we get married. And then I’ll have to worry about the existing account I have.
- Minimums: A good thing that has come of this is that I realized BofA has checking accounts with minimums of up to $25 (which is what we opened). My current account has a minimum of $750 in checking and $300 in savings. That’s $1000 I can drop into my ING account when we make the switch. Nice move!
- Free Checking: This is pretty standard at most banks so that’s a good thing. BofA came through with that too, so no worries.
But I still need some help from people that have done this in the past: what’s the best way of combining our budgets now that we will have a joint account, our own individual accounts, and one budget for the both of us?
I was going to write a clever post about my solution and how great it would be, but honestly, we haven’t even started so I don’t know what to expect. My only suggestion so far was to wing it for a month and take notes, pretending that we were a “new person” that didn’t have a budget previously.
The idea was to jot down what we spend our money on, how much we spend on both of us, on our own, etc. That shouldn’t be a problem because bills and stuff are easy. What might get a little sticky is the saving. I’m pushing for a huge amount of savings per month (for our down payment) and it might make things a little weird.
“Oh, you’re going out with your friends to dinner? Again? Oh… Well I guess we’ll live in a studio then…”
You know what I mean? So my idea was to just keep living the way we’re living in terms of spending (we are pretty frugal, so not going over the budget should be easy, especially once the wedding bruhaha is over). Then analyze our habits for a month to see how much we’ll need to dump into our individual accounts for discretionary, “I have my own money” spending, which I think is important.
Any tips out there for people who’ve done this before? M’s budgeting is all cash based (something like the envelope system) and mine is card based — I put everything on my credit card, pay it off in full at the end of the month, and rack up the points. This is what works for both of us and I don’t think we should have to give it up.
Help us out people.
As for my alternative income, I don’t even want to think about how we’ll deal with that.
May 8th, 2008 at 7:35 am
Hi Nut -
My wife and I merged/moved our accounts to a set of joint accounts shortly after marrying. It caused problems during the marriage, and was the most *ridiculous* hassle to undo when we separated.
My sincere advice, which I’d be suggesting even if I were still married, is don’t do it. Create, rather, one shared account for outgoings (rent/mortgage/bills/etc) and – if you REALLY want to – a joint savings account for very infrequently accessed funds. If I did it all over again, I would genuinely *never* again share a current account or the account into which my salary was paid. For what it’s worth, this wasn’t a bad thing simply because myself or the missus were bad with money; it’s just a very inflexible set up!
All the best!
Jon
May 8th, 2008 at 7:54 am
We simply decided to each put a certain amount in the joint account each month. We pay expenses, rent, utilities, etc. from that account. We have a joint savings account as well for long term… basically a combination of a new home fund/emergency fund. My wife contributes mostly to that, because I’m not currently make enough money for that while building my businesses.
May 8th, 2008 at 1:48 pm
We come up with the minimum income that we can expect each month (for variable incomes)… if you have two salaried folks, then you should know what you have each month.
Then you see how much you spend in each budget category each month… it can help to set an initial cap and then reevaluate after a month. You’re going to be cooking together, so you can’t simply add your two groceries budget together — there’s going to be some overlap.
Let me know if I can help you setup a budget.
May 8th, 2008 at 2:06 pm
Whats hers is hers, whats yours is hers. Let her keep her own account and just open a joint account. Your going to end up having 4-6 accounts if you make it complicated. Don’t make things too complicated, it is alot less stressful. M and I have everything joint including our investments, except retirement benefits which can only be invdividual. M has her own account which was hers before marriage, but she does not put anything new into it. Everything of ours goes into joint accounts.
May 8th, 2008 at 3:36 pm
My wife and I merged everything the week we married. We have joint checking and savings accounts and that’s it. I’m old-fashioned I guess in that I don’t like the idea of separate accounts, unless you have one joint account for shared goals.
May 10th, 2008 at 8:00 am
[...] Getting a Joint Bank Account and Making it Work. Excellent post to generate ideas on merging bank accounts with your new spouse. (@The Writer’s Coin) [...]
May 11th, 2008 at 4:59 pm
We’re getting married this weekend! We both have accounts at the same back so we added each other as joint on each account. We use one account as a “spending” account and one as the “bills” account. Both paychecks are deposited into the bills account and we transfer money into the spending account weekly (groceries, gas, fun money). This guarantees we have money for bills every month and if we run over on groceries or gas, we get less fun money. This has worked well for us because we also get our own savings accounts tied to each checking account. Good luck!
May 12th, 2008 at 5:17 am
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June 2nd, 2008 at 5:42 am
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July 31st, 2008 at 5:34 am
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August 13th, 2008 at 3:37 pm
Good grief! This one’s a toughie.
L & I haven’t done the consolidation thing yet, even though we just bought a house together. And I’m not sure we ever will — just seems easier this way.
All I can say is “Best of luck!”
March 19th, 2012 at 9:00 pm
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