Combining finances is a risky decision that can take your relationship to another level and bring you a huge relief or major regrets. Before you take that next step of opening up a joint account, it’s important to first consider the following five tips to help you tell if combining finances is the smartest move for you.
1. Find out if you both have the same financial goals.
Talk openly about your financial goals for the long and short term, such as paying off an installment loan or saving for a house. Reach an agreement before opening an account. You can always revise the agreement as the relationship grows.
2. Sit and create a budget together.
Make a budget that includes both of your incomes and expenses, such as money that goes into raising a family, paying for emergencies or taking vacations. The more you add to your budget, the more prepared you’ll be in the future.
3. Give the thought a little more time.
Don’t rush into opening an account. Wait at least a year before combining your finances. Doing so gives you time to evaluate the relationship, learn about your partner’s financial behaviors and decide whether or not a joint account is worth the risk.
4. Talk about spending behaviors.
Opposites attract in relationships. Perhaps one of you is the spender and the other is the saver. Discuss spending habits with your partner. Does he or she purchase items with cash or credit? Do either of you and spend money without consulting each other first? Many relationships have ended because of financial conflict, so don’t open a joint account with your partner until you have an established plan and an agreement in place.
5. Consider the type of account that you plan to open.
In the U.S., you can either open a joint survivorship account or a convenience account. With a survivorship account, your partner gains ownership of the bank account when you pass away. In a convenience account, your partner becomes a probate asset after you pass and not the owner. When your partner passes, you still retain the account whether you’ve died or not. It’s important to talk about the type of joint account that you want to open and understand the ramifications of each.
Opening a joint account is not something to take lightly. If you go into it without careful planning, a bad financial decision could damage your relationship. Always Money is happy to help you with funds to get your account started or keep your balance in good standing with an installment loan.
For over 20 years, Always Money Finance has been a regional leader in providing affordable credit solutions to customers across the southeast looking for a convenient and confidential way to meet their needs. Getting a handle on your money takes time, and Always Money understands. If you’re in a jam and need immediate help, any of Always Money’s small personal loan options may be just what you need to get you going in the right direction.
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