OpinionMeister

Tuesday, May 10, 2005

Separate or Joint Banking

The New York Sun has a column by a therapist (precisely what kind of therapist is not revealed) named Elizabeth Bailey concerning the banking habits of married couples. Link.
Over half the married households in this country now keep multiple checking accounts. [...]

Do separate accounts undermine the institution of marriage or cement it?

Most often it is the man who wants to merge and the woman who wants to keep her money distant. A certified financial planner based in Greenwich, Conn., Lili Vasileff, argues that indeed, women should keep at least some money to themselves. A separate account, among other benefits, establishes a credit history, encourages each partner to develop financial management skills and control, and allows the saver to take pride in achieving specific financial goals. [...]

But today, marriage is a partnership - at least in most of the 50% of the marriages that survive, that is the case. This partnership should strengthen and deepen as milestones are encountered or circumnavigated. Even if a couple enters marriage with individual accountability, as the partners make and reach financial goals - an apartment, a car, the extra expense of a child, or even a move from margarine to butter, Key Food chicken to organic - a merger of money makes sense. It is a matter of trust.

Separate accounts paper over insidious differences in spending and savings styles. [...]

It's not so much that separate accounts allow individuality to run rampant. It's that a partnership requires agreements - at the very least an agreement to disagree. The separation of his from hers encourages those disagreements to calcify until they are too hard to remove.

I cannot speak with any authority as to which is better, but I do have a preference. My wife and I have kept a single account from the day we married. Separate accounts somehow strike me as similar to a pre-nuptial agreement - possibly a sound financial calculation, but one that does not demonstrate a great deal of trust. Yes, a lot of marriages do not make it, but I feel that going into a marriage with the assumption that it will make it, and structuring your life and your finances accordingly, increases the odds that it will make it. You may end up worse off if the marriage breaks up, but planning for a possible break-up has got to shape your attitude toward the marriage in ways that make a break-up easier when things get tough, as they do at times in every marriage.

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