Okay, what about the times when I was single, that I had to write a check to myself to move money from one account to another? It’s no different.
Why not?
I don’t mean that flippantly; I honestly don’t see a real difference.
Money comes in from investments and salary and money goes out in the form of bills and automatic withdrawals for various things like savings. Money gets allocated to RRSPs, paid in taxes, received as rebates, put in savings accounts, used to buy equities and mutual funds, put in sinking funds and educational funds for the kid. Money is paid to the mortage and transferred between accounts - including from my chequing account to my wife’s.
Some of these processes are overseen by my wife and some by me. What difference does it make that they are not all routed through some central account?
Well, we write checks to move money from our checking account to our investment account. And by habit we’ve fallen into doing different parts of the process more often than the other person. But that is just habit, either of us could and sometimes do all steps of the process.
Here is an analogy. Since we have a big house, we have our bedroom, her office, and my office/library. Nothing is off limits to anyone else, but I’d never rearrange the books on her bookcase of the pictures on her office walls, and vice versa. In our bedroom we’d never do anything without mutual consent. I’d say that we share the bedroom, but I wouldn’t say we shared offices.
Just thought of this difference. At tax time we see the difference in our incomes, though not throughout the year very much. We never see, or track, or care about the difference in our spending. So much so that at Christmas, from the tradition of her family, presents come from everyone, and after Christmas there can be a complicated accounting where money is passed around more or less on the ability to pay. I recommend it - it eliminates a lot of the stress I read about.
In my first marriage we shared finances and it was a disaster. My ex had no concept of how to track money. Plus we had other problems of course.
I remarried in my 50s and we keep our finances separate, partly from my earlier bad experience but also from habit, since my current husband’s have always been in his name only (this is his first marriage). Also I want to preserve my finances for my son from the first marriage.
Not really. Between the two of us, we have X amount of dollars. I handle some of it and he handles some of it. Sometime I give him money and sometimes he gives me money. The money isn’t anyone else’s; it’s ours.
I dunno, it seems like a perfect example of sharing. We give each other money all the time. Sometimes he buys dinner, sometimes I buy dinner. We take turns. We’re sharing, just like in kindergarten.
And if you can suggest another and easier vehicle besides a check for transferring money from his account to my account, which is where the autopay comes out of, I’d love to hear it. He doesn’t use online banking. Perhaps he should go to the bank, withdraw cash, come home, give me the cash, and then I go to the bank and deposit the cash? It’s just a heck of a lot easier, if it’s his payday and he’s giving me money out of it, to just have him write me a check, then I give him one of my deposit slips, and he deposits the money in my account when he deposits/cashes his check. It’s not rocket science.
Having a joint checking account, especially when it’s the only account (as the OP seems to feel is the holy and correct way to manage money) sounds like a huge headache to me. Suppose he’s out and about with the checkbook and I need to spend some money? What if there’s $500 in the account and we both write checks for $250 on the same day? (And how does that work—2 checkbooks on the same account? Ugh, sounds like a recipe for disaster.)
At tax time we see a huge difference in our incomes, but not throughout the year. We never see, track or, care about differences in our spending either. Neat, huh?
I see the semantic issue. In one sense “ours” is the union of yours and mine. Consider your refrigerator, and something like butter which you can say is ours. You aren’t sharing that butter in any sense. You can’t share something you both own.
When we go out for dinner, and pay cash, she’ll ask me if I need money, which involves how much happens to be in my wallet. But I’m not buying her dinner and she’s not buying me dinner. I usually the credit card thing (being a sexist pig) but it is our credit card.
If I make nachos for myself, and she wants some, then I share. But not money.
If you don’t have two accounts, you don’t have to transfer money, do you? I’m not discussing the transfer mechanism, I’m discussing the need for the transfer.
In situations of tight money, I can see compartmentalizing it for budgeting purposes. We never needed to, even back when money was a lot tighter than it is now, and before cellphones where you can often check. But in 33 years of marriage I don’t think we have ever run into the situation where we both wanted to spend significant amounts of money, unexpectedly, at the same time. But when you have two accounts, what if you both need to spend $250 and you have 270 in yours and he has 240 in his? As any computer scientist can tell you, fragmentation is inefficient.
So, how do you do bills? Do you allocate money based on income into the shared account? Do you divide bills based on ability to pay? Is the private account of the person with the greater income larger than that of the person with the smaller income?
The way I see it, I am (or he is) buying US dinner. We both eat, the restaurant gets its money. Who cares how the transaction is accomplished?
We would find the hassle involved in managing two people having their hands in a single account more onerous than occasionally having to transfer money.
Well, if he wanted to spend $250 but only had $240, he’d wait until next payday. If it was a necessary purchase (say, car repair) we’d hit up (my) savings or use the credit card. Or, horror of horrors, I might give him some cash. What a horrible chore it is, too!
Honestly, the transfer thing happens once or twice a month at most. Usually he gives me part of his biweekly paycheck (toward the bills that he doesn’t pay himself*), but not always. Maybe he needs all of his check this month because he’s making a big purchase. So he’ll make it up to me next check. Or if he doesn’t literally hand over money, he’ll buy all the groceries, or pay the big vet bill this month, or take care of more of the other incidental expenses. Really, it all comes out even.
We are not HAL. We are human beings. The most “efficient” method is not always the one we are most comfortable with. I would get huge headaches if I had to co-manage a checking account with ANYONE. This system works for us, and we’re very happy with it. Why does it bother you so much?
- Anything that can be paid by autopay or online comes out of my account, because I’m most comfortable with that system. I prefer not to write checks, so any bills that require a check, he pays (he uses checks and credit card only, no debit card, his preference). I think there may be a few that probably COULD be auto-paid, but he prefers to pay them himself. Whatever. The bills get paid and we have an excellent credit score.
And also (anyone), please to be explaining how exactly people manage the mechanics of 2 people, 1 checkbook? Not duplicate checkbooks and registers, surely. OK, so you could both have debit cards. How the heck do you keep the register accurate? Does it stay in a drawer and you both come home with a pocket full of receipts, then enter in the amounts? <shudder> Does Wife or Husband always have The Book (which seems to me an awful lot like just having separate accounts anyway, if only one person is managing the money)?
My husband frequently has far more money in his account than I do because he has a higher-paid job and fewer pre-tax expenses than I do, such as healthcare and dependent care reimbursements. In fact, he usually has at least twice, if not four times what I have. But I’m not sure what that has to do with anything. The money is still ours - more of it just happens to be in his checking account, not mine.
As for bills - we divvy up based on our strengths. My husband can’t remember to pay bills, so those he does pay are automated. I remember those things (well, 98% of the time), so I take care of things that can’t be automated as well as unexpected expenses, unless an unexpected expense is unusually high. If it’s high, I tell him and he pays.
It’s just not that big a deal, really.
We don’t bother to keep the register accurate. I get an update email from my bank if there were any transactions the previous day. I eyeball it and make sure everything is accurate. As long as they all match what I know happened, I don’t worry about actually checking the math.
These days we do enter every receipt into a spreadsheet because we went from living slightly above our means to saving about 40% of our income, and to make that kind of switch we really had to start paying attention to what we spent. But before that I just kind of kept an eye on the running balance and if it was getting low I would tell my husband to lay off the debit card.
I only write checks to pay a couple non-automated bills, and I don’t think he’s written a check in ten years.
To add to what** Manda Jo **said, we have a standing rule that if either one of us is going to spend over $150, we check w/ the other one first (unless it’s for groceries or standard household bills). It’s not hard since a large purchase like that is usually planned at least a little bit ahead of time, or if not there’s always cell phones.
I usually enter stuff into the check register, we just put the debit receipts on the desk and I take care of them when I notice them. My SO gets paid once a month so we sit down together and do the bills at that time.
We don’t really divide the bills based on ability to pay, no, because either one of us could pay all the bills, really. So we just divided bill paying according to personal preference.
Addressing both of these… “Two accounts”? Only two? Brace yourself, we both have multiple accounts! In different banks even! Some in my name, some in hers, some in both.
When you were single did you have only one? When I was a young, single dude in college I had four. Broken down thusly:
- Account attached to my student loan at one of the few banks that dealt with government-backed students loans.
- No-fee checking account that let me write checks and process transactions without hammering me with fees, but paid me no interest (so it did f–k all for growth)
- High interest savings account for growth, my college-age savings was pretty weanie, at least growing a little bit.
- Line of credit account. The interest rate on that was only half of credit card rates. I used it kind of the way RSP Loans work today to maximize my RSP contribution (tax-free investment plan).
So back then I had to move money around too. From myself, to myself, and back again. I’d have to go to one ATM to withdraw money to deposit in an ATM across the street to cover my student loan payment deduction. The idea is to maximize growth, and minimize the cost of banking.
My wife and I manage our money in similar ways. Our money is in a lot of different places to maximize long-term growth while keeping risk and cost to a minimum. Even if everything as in both of our names we’d still be transferring money hither and yon from time to time. So I can’t actually answer “Is the private account of the person with the greater income larger than that of the person with the smaller income?” because we have different accounts that do different things for us.
Do you have one phone line? Does that phone line have an extension in each office?
We have OUR money. A like the one phone line that has an extension in the bedroom and each office, our money is safely in a mixed system.
Here’s how we do it:
- There is only one checkbook.
- I am in charge of the financial record keeping in our household. That way we can be sure that every transaction is entered once and only once.
- We don’t use debit cards. We use credit cards. Then we get a single credit card bill every month, which I pay in full. That covers the vast majority of our monthly expenditures.
- For cash: I check my bank account online every morning so I see what ATM transactions occured the previous day. I then enter them into the checkbook register.
- A cushion is kept in the checking account more than we could reasonably expect to need all at once; if my wife needs an unually large amount she’ll tell me and we’ll figure out together how to make it work.
- Most regular transactions that cannot be paid via the credit card are now paid via online bill pay. It’s my job to pay those expenses as well. Same for moving money to savings and investments on a regular basis.
- There are very few expenses that call for a paper check, and very, very few that I cannot pay but my wife must pay instead. Then she tells me she’s taking the checkbook with her for the day and gives it back to me when she comes home. Actually, the only thing she does that for nowadays is for the day care of our son.
The most important point is this: Because my wife can put almost all of her purchases on a credit card, it doesn’t matter (within reason) what the checking account balance is.
We have one checkbook, which almost always sits at home, and pretty much only gets used for bills which can’t be paid online. We have two debit cards, and are pretty good about writing in withdrawals. (I find maybe one missing every few months.) Whoever gets cash puts most of it in a drawer where either of us can take it if we run low. Most of our transactions are done on our Discover Card - cashback, no fee, and no interest because we always pay it off. Who writes checks out any more?
Perhaps, but in matters economic, I tend to think there is strength in diversity - having lots of accounts means that, should something screw up with any one account, you are not screwed. 
For that very reason, I also tend to have accounts with different banking institutions.