Combining bank accounts with your partner before tying the knot is a significant decision with benefits and considerations. This blog post will explore various aspects of this decision, from its impact on marital happiness to different approaches and practical steps in merging finances.
Combining Bank Accounts Before Marriage Leads to a Happier Marriage
Yes, you can combine bank accounts before marriage.
A matter of fact, a recent study led by Modern Husbands Advisory Board Member Dr. Jenny Olson found that couples who combine their bank accounts before marriage will, on average, experience a happier marital life.
The research indicates that sharing financial resources fosters a deeper sense of partnership and trust, which are foundational elements of a successful marriage. This shared approach to finances helps in aligning financial goals, reducing conflicts over money, and building a stronger, united front in managing both challenges and successes.
You can listen to Dr. Olson share the details behind her work on a past episode of the Modern Husbands Podcast.
Additional Research
Marketwatch dove deep into academic studies on banking practices within marriages and interviewed experts on finances and relationships. Most of the experts they talked to we also spoke with, experts who also serve on our Advisory Board.
We spoke with some of the same experts they did, experts who also serve on our advisory board. Their findings are unique because they also conducted a large survey to collect data about banking practices and attitudes.
Through this research, they learned that joint banking has shown to be beneficial for couples. Below are the highlights.
Yours, Mine, and Hours Is an Option
For couples who are not ready to fully merge their finances, the "Yours, Mine, and Ours" approach can be a viable alternative. This strategy involves maintaining separate accounts for personal use and a joint account for shared expenses and savings.
Dr. Scott Rick, a past guest on the Modern Husbands Podcast, shared why this strategy is particularly helpful for couples who are financial opposites.
According to Dr. Rick, the structure of the approach is important. We took a deeper dive into his ideas in our past post, How to Split Your Finances: Psychological Money Laundering.
Below is an illustration of the flow recommended by Dr. Rick.
How to Start with a Conversation
Initiating a conversation about combining bank accounts is crucial and can be challenging. It’s important to approach this talk with openness and understanding, focusing on mutual goals and concerns.
Discussing each partner's financial history, current obligations, and future aspirations can provide a comprehensive understanding and set a solid groundwork for joint financial planning.
Dr. Megan McCoy, CFP®, LMFT, CFT-I™, AFC® is an Assistant Professor at Kansas State University's Department of Personal Financial Planning. She is a licensed Marriage and Family Therapist, an Accredited Financial Counselor®, and a Certified Financial Therapist-I™.
Dr. McCoy is also a contributor to our Marriage Toolkit. Her topic, how to start a money conversation, is included in the free preview.
Click here to access your free preview to the Marriage Toolkit.
The Process of Joining Bank Accounts
When you decide to combine bank accounts, the actual process can vary depending on the bank or credit union, but generally follows a standard set of steps:
Compare bank or credit unions
The fees they charge
The services they offer, like online bill payment or a mobile app
The interest they pay for savings accounts
Pro Tip: Find out the minimum balance requirement, which is the amount you must keep in the account at all times to avoid or reduce fees. This may not be the same amount you need to open the account.
Gather Required Documents
You must also provide information so the bank or credit union can verify your name, date of birth, address, and identification number.
An identification number can be a Social Security number, Individual Taxpayer Identification Number (ITIN), passport number and country of issuance, alien identification card number, or other government-issued identification number.
Many banks require you to show a U.S. or state government-issued identification card with your photo on it, such as a driver's license, U.S. passport, or military identification. If you do not have a U.S. or state government-issued form of identification, some banks and credit unions accept foreign passports and Consular IDs, such as the Matricula Consular card.
Additionally, you generally need one of the following:
Your Social Security card
A bill with your name and address on it
Your birth certificate
Set Up the Account
Visit the bank together to fill out the necessary forms. Decide if you want one or both partners to have equal access to deposit and withdraw funds.
Pro Tip: Establish a split deposit into a savings account at a credit union or bank. By making saving automatic in this way, your savings balance is out of sight and thus out of mind.
Wrapping it Up
Deciding whether to combine bank accounts before marriage is a personal decision that depends on each couple's unique circumstances. It requires honest communication and careful consideration of both partners' financial habits and goals.
Whether you merge your accounts fully, partially, or keep them separate, the most important thing is that both partners feel comfortable and agree upon the approach. This financial unity can play a crucial role in building a strong and supportive relationship.
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