Joint Account or Separate Accounts?

Basics Mar 8, 2022

Joint vs separate accounts is a recurring topic, and I'm firmly a believer in the power dynamics of separate accounts that feed into joint ones. That approach scales better for polyamory.

That's a dense statement, so let's unpack each portion of it!

What is the Joint vs. Separate Bank Accounts Debate?

There are countless articles about whether people should have joint or separate bank accounts. They are often centred around couples and marriages, since that's the common experience in personal finances.

Some are ridiculously sensationalised, proclaiming that your relationship is "doomed" if you keep separate finances.

If you ask people in general what they think, you'll find that the only people who care enough to come out of the woodwork to answer tedious personal finance questions are those that believe strongly for or against them.

If you ask specific people though? You might find that most people are reasonable and don't care one way or the other, and might say that each have their benefits and downsides.

There's some tangential benefits to having only joint accounts, and some significant risks – of course, those risks may never come to fruition.

There's some convenience to joint accounts, particularly when you are anticipating one person dying in the near future and need to pass along assets. The increased visibility into each person's finances can also be a benefit.

Yet the downsides are severe. If things get toxic, then joint accounts make it messy to disentangle. Increased visibility also increases friction and petty gripes.

Which leads into the next point...

What's With the Power Dynamics of Shared Checking Accounts?

There is a lot of momentum keeping joint accounts in the mainstream. It's historical cruft, in my view.

Remember the "good old days" when women were considered property of their husbands and relatives? Or when the majority of women in the U.S. could not open their own bank accounts until the 1960s? When credit and loans were unavailable to them without a male co-signer?

In my eyes, using only a joint account is a holdover from the days of old, with screwy power dynamics. It's a vestige of the patriarchy where women aren't allowed to administer their own funds without someone else interfering.

Joint accounts are also a tool for financial abusers to weaponize. If you don't have your own money to walk away with, you can end up trapped in an abusive relationship.

In general, having only a joint account makes deescalating more difficult with partners, even if they're not abusive.

It's small stuff, like if you're dumping income via direct deposit into a joint account, you're going to need to hunt that down to change. Multiply that out by a dozen small transactions, and closing becomes a point of friction.

Relationships should have minimal friction in my eyes: people free to join and separate without external factors forcing them together for convenience.

When Should You Use Joint Checking Accounts?

My short answer to when joint accounts are good?

Use joint accounts when you're expecting someone to die, have high risks of death, or are absent for significant periods.

In my life's experience, that includes one of my retiree friends with a terminal illness swapping over all his accounts to be joint so that joint survivorship made things easier for his wife to pick up the stray assets left behind from a heartbreaking death.

Or another experience I've seen is military spouses, who contend with extended time apart – especially when dealing with large life events like house buying. Joint accounts and powers of attorney are useful for running the household when a spouse is away for months at a time.

Individual Feeder Accounts Leading to Joint Checking aka "Yours, Mine, Ours"

There are benefits to keeping separate accounts where income arrives and individual expenses are handled.

You might expect that individual accounts are good for privacy, which is true for circumstances when you need to hide transactions – such as when staging to walk away, or purchasing a surprise gift.

Yet in my relationship with my dearheart, I expect all transactions to be entered into our accounting system. The "privacy" afforded by independent accounts is waived in favour of accountability.

It's a choice to waive privacy with individual accounts, as opposed to being forced to have no privacy with joint accounts. Any staunch privacy advocate understands that privacy is about that exact choice, and that transparency can be good.

Besides privacy, we also willingly consider our resources to be pooled, despite keeping them in individual accounts. It's a trick of perspective.

It's like we have one big pool of assets, unless something changes about our relationship and we need to disentangle. Then we still have the benefit of separated finances.

We push cash from our individual accounts to joint accounts when it makes sense to – such as for the condo mortgage. For incidentals like groceries though, my dearheart handles them through his personal account.

As I'm involved heavily in personal finances, I keep a close eye on all our accounts. I rebalance our cash holdings as needed to make sure no account falls below our set goals.

To do so, I run monthly balance sheets to help with keeping track:

Polyamory and Shared Finances

If everyone keeps individual accounts and then contributes to specific joint accounts where needed, you've got a decentralised and expandable system.

The downside of this system is that it can take a week to set up, and involves more administrative overhead as you need to shuffle money to several places. You also need to beware monthly transfer limits – i.e. if you can only transfer money out of your account six times a month.

As with most polyamory, spreadsheets and Google calendar are your best friends here. Or custom software, if you're like me and tech-savvy enough to roll your own.

In my case, I keep a joint household account with my husband at the same credit union as my personal account. It's explicitly for the mortgage and rental income, as well as incidental joint expenses.

My credit union offers an easy way to transfer money to another member of the union, so I therefore can instantly transfer money to the joint account via the option to transfer to another member at my credit union.

To transfer money directly to my dearheart's account at a different credit union, I set up ACH transfers. Transferring money to people in the US is subpar at best, but this is the best option I've found to do so.

With my dear lady's addition to my life, I'm considering how to refine my current setup.

For one thing, I'm hoping that fintech may actually have some benefit here. Quick transactions with less friction would be appreciated – especially to transfer petty cash between paramours.

Another aspect is that I might want to search for a credit union that supports more than two people on a joint account, in case I end up with large household to manage.

I've also contemplated making an entity for my polyam household, which would allow ownership stakes in the entity to come and go with multiple participants. It's an experiment I haven't heard of before, and I look forward to seeing what can be done.

Those sensationalised articles about doomed relationships with separate accounts are trying to make a point – poorly, in their case.

That point is that when you have separate accounts, you can get caught up in the trap of saying "it's my money to dispense with as I please."

If you're trying to share financial goals with a partner, then this is a breakdown of communication. There's no room for accountability, compromise, and discussion.

Instead of shutting down conversation with "it's my money," it's important to outline your shared goals. Then you can state how your actions support those goals.

That's not to say that personal spending is right out – it's a common goal to enjoy life in the moment, since the future is not guaranteed. In my case, my dearheart and I agreed to allowances. As long as we stay within the bounds of those purchases, we do not pry or care about what all it was spent on.

To read more about allowances for adults, as well as more details of my finances with my husband, I shall call to your attention this article: