Kevin O’Leary: Couples Should Keep Their Finances Separate
Written by
Kristopher Kane
Edited by
Susan Kim
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Many couples, married or in long-term committed relationships, may ponder the issue of keeping their finances separate or opening joint accounts. Though the idea of sharing everything from good times to hardship has a certain romantic appeal, is it good advice?
If you take the word of renowned investor Kevin O’Leary, couples should keep their finances separate. O’Leary is perhaps most famous for being one of the investors on ABC’s popular show “Shark Tank,” where hopeful entrepreneurs present their ideas to the gathered “sharks” in hopes of convincing them to invest.
O’Leary strongly recommends that couples keep their finances separate. It might seem strange and run counter to traditional wisdom, but O’Leary asserts that maintaining financial independence can do wonders for a relationship.
Are Joint Banking Accounts Good for Couples?
For most romantically involved couples, combining finances is a meaningful sign of trust and commitment…a way to say, “No matter what happens, we’re in this together.” However, O’Leary maintains that keeping your finances separate isn’t a question of love or trust but rather about retaining control over your financial destiny.
Money matters can be a significant source of stress and friction in a relationship — it’s one of the two biggest things couples fight about (the other is intimacy). In many cases, finances aren’t just a matter of economics but also of emotion. Financial disagreements can cause tension and, in extreme cases, can even strain relationships to their breaking point.
Joined Finances, But Not Joint Accounts
O’Leary is clear and blunt when cautioning newlyweds against fusing financial resources. The outspoken tycoon isn’t shy about offering words of wisdom on a range of topics and when it comes to personal finances in a romantic relationship, he has a clear stance: Keep your money separate. O’Leary sees this as a critical step both parties should take to protect their financial security.
O’Leary goes so far as to say he prohibits the practice of joint accounts within his own family and “forces” pre-nuptial and even co-habitation agreements. He claims this minimizes financial conflict. While studies have shown that money-related arguments can contribute to instability in relationships, not all sources agree on the causes.
Could O’Leary Be Wrong About Shared Accounts?
Not all marriage and financial experts agree with O’Leary’s advice. According to a study from Northwestern University’s Kellogg School, sharing a joint bank account can be a strong predictor of a couple’s happiness. The study found that the choice to combine finances indicates a certain level of commitment and trust, which can significantly enhance relationship satisfaction.
Joint bank accounts can also invite transparency in a relationship. When both partners see each other’s spending habits, it allows for honest conversations about financial priorities. This openness can foster understanding, trust and a feeling of shared goals.
Merging your money can simplify things by reducing the need to divide expenses or keep track of who owes what. This can save time, reduce miscommunication and prevent potential disagreements about money.
Finally, a joint account can provide a sense of unity and equality, reinforcing the idea that you’re working together as a team. Money is less likely to be perceived as “mine” or “yours” but instead as “ours,” promoting a sense of shared responsibility and partnership.
For Richer, But Maybe Not for Poorer
So what’s the best approach — the traditional one backed by recent studies or the advice of an entrepreneur and businessman with a net worth estimated to be $400 million? According to O’Leary, having control over your finances doesn’t put a damper on romance. Instead, it can provide clarity and instill confidence. If each partner knows where the other stands, O’Leary claims that can bring about a sense of security and foster individual growth.
If applied well, O’Leary’s philosophy of keeping finances separate while maintaining open communication, thoughtful planning and a proportionate financial contribution toward shared expenses could make one’s romantic life easier and maybe even a bit richer.
O’Leary’s suggestions may not resonate with everyone and that’s to be expected. Naturally, what suits one couple may not suit another and every couple has to find their own way to navigate their situation using communication, understanding and mutual respect as their compass. Merging finances is not a one-size-fits-all solution and there’s no rule stating that love and shared bank accounts must go hand in hand. O’Leary’s advice is just one (very wealthy) man’s opinion and the studies referenced above are based on a much larger set of empirical data. Ultimately, the decision lies with each couple.
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