Having one would make it easier to pay common bills, but how do you go about doing it? Here are our tips if you are planning to set up a joint account with your other half.
Setting up a joint account with your partner may be a scary thing. After all, money can be a sensitive issue, especially if you are both drawing vastly different incomes. This also makes your relationship more official (well, as official as it can get before you are both legally married), and it may set you up for heartbreak and potential issues (scams, and so on), if the relationship goes south.
That said, there are conveniences to having a combined account, especially if you have got common bills to pay. And, instead of trying to keep up with who owes what, and who should pay for what, there may be more advantages to opening a joint account, than not.
Here, our tips to managing it.
- Communicate with your partner before setting it up
Having a joint account is a huge step, and you both need to be on the same page when it comes to your expenditure. Questions like withdrawing cash (do you need one signature, or both), what should the money be used for (common ones include the wedding, rent/mortgage, groceries, utility bills, car payments…), how much should each partner contribute toward the account (we recommend a fixed percentage of your pay instead of a set sum, especially if you are both earning different amounts), and so on.
- Retain your own individual accounts
While caring is sharing, it may not be safe to do so here. It is still better to portion a part of your salary into your own account, in case of rainy days and other situations.
- Put a percentage of, instead of a fixed sum
As mentioned earlier, if you are both earning different salaries, it may be fairer to contribute a percentage of your salary instead of a fixed sum into the joint account.
*Use it for common bills only
Whether you both share the same values when it comes to money or not, reduce conflicts and confusion by using the account for bills you both are responsible for. This includes expenses for your wedding, your flat, renovations for the flat (watch out for these unexpected costs!), groceries, and so on.
- Let your partner know if you are taking money out of the account and vice versa
If there are last-minute expenses you have to incur, or if there are some matters to take care of while one of you is unavailable, just make sure you let your partner know, and vice versa. It is only a courtesy anyway, and it is also to prevent any miscommunication or misunderstandings from happening.
Addressing issues with joint account
Money issue is one of the top causes of conflict and arguments within a marriage. From one partner overspending to managing your mortgage, here’s how you can stop it from affecting your relationship.
If spending habits are hurting your relationship, it is time to act. Money is one of the top four causes of conflicts in a relationship, according to reports. No matter what we argue about — he spends too much, she hides the bills, there isn’t enough to go round — we do argue. the money may not even be the real issue.
“Most people fight about money because our families or origin impact how we regard money,” says Melbourne psychologist Meredith Fuller. “It can be an emotional issue, and no amount of financial advice can solve the problem.”
If yours was a family that did it tough, you will look at the world differently to a partner whose parents were not short of cash or believed things would always turn out for the best. Money is not just a stack of notes — it represents power, freedom, independence and security.
“Part of the problem is that we don’t talk about it enough,” says financial counsellor, Sheila Freeman. “It only comes up in a crisis. Ideally, you would work through the bills together so you both know what it costs to live.”
Let’s face it, in the current climate we are even more likely to have “heated debates” about money. Here are ways to stop those arguments turning into warfare.
- Make it just about money
It is hard, but avoid bringing up other relationship issues that have been bugging you. “Very often, couples will scream and yell about money,” says psychologist Jane Haufbaum, but they are really arguing about other things, who’s doing the housework, or who is not putting the kids to bed. Money is an easy cause to latch on to.”
Sit down and discuss only the issues at hand. If you feel your partner has overspent, tell them that, but don’t use phrases like, “That is so like you” or “I’ have told you before”. It will only escalate.
- Remember you’re in this together
Screaming at each other won’t pay the mortgage. You have to work together, and the best way to do this is to write a mission statement for your finances. This might sound odd, but it works.
“Just write down your financial goals. It may be as immediate as, ‘We need to pay the mortgage next month,’ or it might be, ‘We have to limit our outgoings by 30 per cent,” says Jane. “If you have a shared goal, you’ll both focus better.”
- Play to your strengths
Think about your partner. Are they a planner? Do they love spreadsheets? Think about your own strengths and weaknesses, and when you draw up a budget, use the person with the relevant skills to organise key areas.
- Talking about money problems
Pick a place that is neutral territory and put a time limit on the talk. Don’t make it a blame session. Concentrate on ideas for managing better instead.
If one of you has trouble saving, try writing down every cent you spend to see exactly where the money is going. That way, you can more easily work out where you can trim costs.
[Punch]
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