Starting a family comes with a lot of planning and managing your finances is one of the crucial ones. It will come a time when you have to decide if you need a joint account because that would mean transparency and a higher level of sharing.
Do you really need one?
You don’t necessarily need a joint account since you already have your own individual accounts prior to getting married. Basically, a joint account is a shared savings account. If you have ‘nothing to hide’ and both of you are able to ‘share everything’, then a joint account would do you a lot of good. However, you could still maintain your own individual accounts. If that is the case, why should you have a joint account then?
Family Financial Management
A joint account will let both of you manage your expenses and other financial commitments.
- Expenses – This account can be used to pay for your utility bills and insurance payments that are recurring monthly. You should both contribute a certain amount to this account which can then be used to pay for whatever expenses you need to. Besides that, this is also the account that you use to pay for your mortgage or hire purchase loans. With this account, you can both monitor and assess your spending better and find ways to reduce it where necessary.
- Emergencies – A joint account allows either one of you to have access to the finances especially when there is urgency. If either one of you is unable to access the accounts, the other partner could still ensure that the finances are accessible.
Managing the joint account
With a joint account, management is crucial because any irresponsible act from one party could detriment the entire plan. One thing for sure, you need to have maximum transparency with money issues. There will be no privacy whatsoever when it comes to finances. There should not be:
- Overindulgence – One party should not over-indulge in spending using the joint account’s funds. Even if you are spending using your own individual account, your commitment to the joint account must not be compromised.
- Decision-making – Both of you need to come to an agreement on any additional payments to be made as it would mean having to contribute more each month from your respective salaries. If you are going to take out a loan for renovation, both of you must agree (or disagree).