Some Very Good Reasons To Keep Separate Bank Accounts in Your Relationship

Mature couple calculating bills at home using laptop and calculator.
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In 2018, a Bank of America study revealed that millennials were once again coloring outside the financial lines and breaking yet another generational money trend. More than one in four — 28% — were keeping their finances separate in their marriages and long-term relationships. In fact, one in five millennials didn’t even know how much money their partners made. For context, just 11% of Gen Xers and 13% of baby boomers kept individual bank accounts.

So, do the older sets have it right, or is it smarter for couples to share everything except money? 

There is, of course, no one right answer for every couple, but as it turns out, the millennials might be onto something. 

See: Behind on Your Retirement Savings? 6 Money Moves Millennials Should Make To Catch Up
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First, the Argument Against Separate Accounts

Many experts, particularly those from the old school, insist that divided finances lead to divided relationships. The Atlantic, for example, cited a 2006 study that suggested that couples with joint accounts were more likely to stay together than those who kept their dollars and cents apart.  The study’s authors said that segregated finances indicate a lack of trust and preclude the couple from working toward their financial goals as a unit.

Building Wealth

Many, many other experts, however, say that there are plenty of cases where it makes sense for long-term couples not to have their finances tie the knot even when they do. Here are the top four.

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One or Both Want to Maintain Privacy, Autonomy, and Control

Suze Orman is emphatic in her belief that separate finances are one of the keys to a healthy relationship.

According to NextAdvisor, Orman defies conventional wisdom in saying that it can actually build trust when each party has enough faith in the other to let them keep control over their own private finances — “private” being the keyword. In many cases, people look at having their own checking account the way they look at having their own bathroom — it’s just not a part of their lives that they share with even their most intimate partner. They want to spend and save however they choose and trust the other to do the same.

Explore: Will Millennials and Gen Z Have Enough Money To Retire?

They Have Different Spending Habits

Orman’s other point was that in almost every relationship, one person invariably spends more or is less diligent about saving than the other. The lower spender or better saver often resents the other as a drain. The higher spender might resent feeling like he or she is being monitored or told what to spend and what not to spend. 

It’s hardly uncommon.  

As U.S. News and World Report points out, money battles are one of the primary causes of breakups and divorce. Separate accounts remove most of the ammunition from those battles.

Read: What It Means To Live a Truly Rich Life and How To Achieve It

One Wants to Protect the Other From Creditors

As CNBC points out, separating your finances can not protect you or your money in the case of divorce — but it might protect your significant other from being hounded by your creditors.

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According to US Bank, creditors can’t target your spouse or significant other, but they might be able to target a jointly owned bank account with the debtor’s name on it.

Find Out: 17 Biggest Budgeting Mistakes You’re Making

One Party Brought More Money Into the Relationship

Another scenario where separate finances might make sense is when one party comes into a relationship with a whole heap of premarital cash and the other does not. According to the Teachers Insurance and Annuity Association of America (TIAA), whether it’s inheritance or savings, if you came upon it while single, it’s not considered marital property — until you mingle it into a joint account.

Find Out: Why You Should Start Budgeting Now for 2022

In the End, You Don’t Have to Pick One or the Other

So, should you marry like a millennial and keep your money separate or do like their parents did and go all in together? Who says you have to choose? 

According to USA Today, there’s an alternative that can offer the best of both worlds, prevent friction and fighting, and allow each party to retain autonomy while also uniting the couple behind a communal account. It’s easy — just do both.

By opening a joint account and also maintaining individual accounts, both people get to maintain their privacy and control over the money they deem to be theirs while also sharing money used to pay bills and make the household run. 

This highly effective compromise strategy is unofficially known as “yours, mine, and ours.” 

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Last updated: Oct. 28, 2021

About the Author

Andrew Lisa has been writing professionally since 2001. An award-winning writer, Andrew was formerly one of the youngest nationally distributed columnists for the largest newspaper syndicate in the country, the Gannett News Service. He worked as the business section editor for amNewYork, the most widely distributed newspaper in Manhattan, and worked as a copy editor for TheStreet.com, a financial publication in the heart of Wall Street's investment community in New York City.

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