Can We Just Talk: Should you have a joint account with your partner?

‘Can We Just Talk?’ is a series which aims to debunk the idea that it’s difficult to talk about money. In our first episode, our Contributing Features Editor, Karishma Tulsidas, sat down with Editor-in-Chief, Elizabeth Lee, and Beauty Editor, Letty Seah, to discuss whether you and your partner should have a joint bank account.

Why joint accounts?

For most couples, it's to manage the joint finances in their household.

"We started having to make payments for the house, for the car," says Elizabeth. "So right now, the joint account that we have mainly makes payments for the house and car, because I feel like those are set payments that we know to expect every time."

But how far this idea of joint accounts goes will depend on the couple. Other examples of shared expenses might also include expenses like food, or utilities, or insurance. For some, they might even choose to pool all their money together.

Another consideration is also how much each person in the relationship contributes to the joint account.

"When we first started, it was 50/50," says Elizabeth. "Throughout our careers, when one person earns a lot more than the other person, then we might adjust it slightly. But if not, it will go back to 50/50."

What benefits can you get from having a joint account?

Firstly, it can be a nice romantic gesture that shows your trust and commitment in each other.

Joint accounts can help newlyweds, or couples in general (you don't have to be married to open an account), align their financial goals with each other. It can also help prevent squabbles over scorekeeping, where a set amount goes into the shared account. As in Elizabeth's situation, it can also be a nice way to settle shared debts.

It can also help you develop better personal habits when it comes to budgeting.

"It's definitely made me more disciplined in a sense that I need to know to put aside X amount of money each month," says Elizabeth. "You don't have to worry at the end of the month, and [go] "Oh, I need to dig out another like $300 of $100 to pay for this bill [...] and that has given me financial freedom in some ways because whatever is leftover, I can do with whatever I want with that money."

In situations where you or your spouse aren't working, it can also be a way to ensure that you have some degree of money sharing and financial freedom.

Is it suitable for everyone?

That said, it's definitely not for everyone. For one, not every couple will have these shared financial commitments yet.

"The need for it just hasn't come up," says Letty, who has been married for a year and has chosen not to have a joint account with her husband as they are not living together at the moment. "We're still in the midst of looking for place. So maybe [we will] when we have to finance that place."

It might also be an issue if one of you has very complex finances or vastly different spending habits from the other. If financial independence and privacy are priorities, those can become a source of friction should the money be pooled together.

Lacking full trust in each other when it comes to finances may be reason to stay away. For example, your partner might not be very financially prudent and cause you to share their debts. This is even more so the case if your trust in your partner isn't there at all, where joint accounts can end up complicating divorce proceedings further or become a tool for financial abuse.

Is a joint account outdated?

This is a sentiment increasingly shared by many, especially amongst younger generations. Marriage as an institution is becoming less subscribed to in Singapore, as rates of citizens remaining unmarried have increased. Further, some believe joint accounts are a sign of antiquated gender roles, a relic of a time when shared finances were advocated for because women were expected to quit their jobs after bearing children.

What's best for me?

This is something that will depend from couple to couple. Studies have shown that joint accounts tend to lead to happier marriages. Sharing resources necessitates conversations about these difficult topics, and having shared goals keeps couples on the same wavelength. Ultimately, what works for others may not work for you, your relationship, and your circumstances. What's most important is to have open communication, trust and honesty in your conversations with your partner, especially regarding finances. After all, as Elizabeth noted, "money is [among] the leading cause[s] of divorce."