Keep your finances separate - MoneySense

Keep your finances separate

When you get married, does that mean you’re becoming financially dependent on each other? I don’t think so.

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When I come across couples that are joined at the hip financially it makes me cringe. With a resounding, “We love each other, why would we keep our money separate?” these people equate life partnership with total melding. Coupling doesn’t mean make yourselves one, coupling means making your new economic unit stronger.

You’ll notice there’s no such thing as a joint RRSP or a joint TFSA. Each of those vehicles has to be used separately. Joint accounts are great for dealing with the monthly fixed expenses like your rent or mortgage, utilities, food, insurance and the like. But savings … well, savings should be a thing you manage individually. Since you have to invest your money for your savings to grow, keeping your savings separate is a nod to that independence you need to maintain to be a healthy couple. Plus, individuals typically come with different risk personalities, time horizons, and goals.

Don’t even get me started on joint credit. Other than a mortgage, no credit should be joint. If you must have a line for which you are both liable, then it should take two signatures to access it.

I’m not sure where the idea that we need to merge all our money to be totally committed to a relationship came from. Yes, you need to work together. Yes, it would behoove you to have at least a few goals in common. And, yes, keeping secrets is a bad idea. But having individual financial identities—individual credit and savings—is the only way to make sure you’re strong on your own, as well as strong in your partnership.

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