How To Navigate A Joint Bank Account Even If You Earn Very Different Salaries

02/02/2016 2:20 PM AEDT | Updated 15/07/2016 12:51 PM AEST
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There are many reasons to consider opening a joint bank account with your significant other. It may be that you're saving to buy a house, or that you already live together and want an easier way of splitting the cost of household products.

But while there certainly are advantages to pooling your finances (fewer bank fees, anyone?), when it comes to money and relationships, things can get tricky.

"It can be a slippery topic," psychologist and relationship expert Melanie Schilling told The Huffington Post Australia.

"I think when approaching the decision of whether or not to open a joint bank account, the first question to ask yourself is 'what stage of the dating journey are we up to?'

"Basically, there are three series of dating. The first is attraction, the second is confusion -- and some people don't ever get out of that stage -- and the third is commitment.

"This is the phase I would typically expect people to start considering a joint bank account, and definitely not before."

It is a sentiment echoed by John Arnott, executive director of customers at ING Direct.

"The classic times where we see people opening joint accounts are linked to other financial moments, for example, buying a home, moving in together, saving for a holiday, or just generally when people align their financial goals," Arnott told HuffPost Australia.

"I don't think there is necessarily a 'perfect time', it's more around your life stage and when you have that mutual alignment."

Mutual financial goals or not, Schilling says one essential thing to consider is how you and your partner were raised in terms of attitudes to money.

"We all come from different families and different money backgrounds," Schilling told HuffPost Australia. "And with that comes different money behaviours.

"If you grew up in a family where money equals freedom, if extra money did happen to come through, your family might say something like 'great! Let's go on a holiday!'

"However, your partner may have grown up in an environment where money equals security. So, if their family received some sort of extra money, the attitude might be more, 'great! Let's whack it on the super or put in a long term deposit.'

"I think it's important to ask yourself: 'what does money mean to me as a person and how does that differ from my partner?'

"If it’s the same, great. But more often the values are different."

We're working on his spending- he's worse than a girl. #jointbankaccount #realworldprobs #fastfoodjunkie #tvest #lovehim

A photo posted by Abby Smith Vestal (@abbyvestal1212) on

You might find you and your partner have different priorities.


So how do you handle the situation where you have a joint account to cover household expenses, only one party is splurging on soy candles and fancy soaps while the other is rummaging through the discount bucket at The Reject Shop?

"Again, this comes down to money value," Schilling said. "If someone is buying fancy soaps and candles, they are placing a higher value on the aesthetic side of things. If the other person wants to buy that sandpaper toilet paper, money to them might be about being frugal and saving. You need to understand your own money behaviours so you can set some rules about this stuff.

"It could simply be a case of, 'I want $8 soap and you want the $1 soap, so let’s go for the $5 soap each time'."

Where the situation can become trickier is if one party earns significantly more than the other. How do you draw up an even playing field when the playing field isn't even to begin with?

"This comes down to what stage of the relationship you’re at and the level of trust that has been established," Schilling said.

"If it’s early days, you might want to consider putting the same percentage of your salary into that account. The approach is 'well, we earn different amounts, but let’s put 70 percent of our salaries into that account, and keep 30 percent for ourselves,' rather than throwing everything in all together.

"Because at the end of the day, in a relationship, money equals power. Opening yourself financially to another person puts you at risk of giving up too much power, if you do it too early or without thinking it through or setting appropriate boundaries.

"Even if it seems like the primary earner is being particularly generous by putting more finances into the account than the other, that's not to say it's not a power play.

"For the lesser earner in the situation, it can be very dis-empowering. Knowing that you have this joint account, but you are only contributing 20 percent. How does that feel from a power perspective in a relationship?

"It’s impossible to separate money from emotion, so I do think you need to be in a very strong, trusting place in your relationship before considering it."

Probably not what this guy had in mind.


For those keen to take the plunge, Schilling still recommends keeping your own private accounts (otherwise known as sanity money) on the side.

"I think it's good to have, say, one main joint account, and you both put the same percentage of your salary into it," Schilling said.

"But then both have your personal accounts for the rest of the percentage. You don't want to be in the situation where you have to explain yourself for buying something with your own money which happened to be stored in a joint account.

"Or to have to ask permission, which in my opinion is even worse than explaining."

In spite of all this, if the relationship is right and adequate boundaries are put in place, a joint account can be a great way to un-complicate finances and work toward a mutual goal with your partner.

"From our point of view, we're seeing more and more people having joint accounts. Gone are the days where someone used to open their wallet and 15 credit cards flopped out," Arnott said.

"Less is better in finances, and the more accounts you have the more complicated your financial situation. A joint account offers you the opportunity to consolidate your accounts and minimise your fees.

"You are still in absolute control over your finances using apps. It’s very a visible process and more and more tools coming out in financial services to help people monitor their spending.

"But I think the overarching rule with joint accounts is you need to make sure you’re prudent. Entering into a joint account, you are empowering the other person to spend or save, whatever it may be. You need to make sure you clearly know the individual and each of you are striving for the same financial goal."

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