Mrs. Rocket and I have separate checking accounts.
We are a single income family, but 17% of my check is directly deposited into a Chase checking account in my wife’s name. For most of our marriage we had a joint checking account, but after incurring a couple of overdrafts, we decided that we needed a different set-up.
Our finances are budgeted to the dollar and so we cannot afford a two or three hundred dollar cushion in our checking account. If too many debits occur on the same day, we are in trouble. There are too many drains on the tub so to speak – her debit card, my debit card, online billpay, automatic debits and two people writing traditional checks. Even if our spending was in line with our budget, it was difficult to avoid overdrafts. One of my wife’s traditional checks might clear the bank on the same day that I paid a bill online – or on the same day that our internet bill is direct debited from the account.
The initial reason for separate checking accounts was so that we could double up on Chase direct deposit bonuses – unfortunately this was when Chase checking bonuses were only $50 instead of $125. I intended to close her account eventually, but we have come to like the set-up. It works for us. 17% of my check corresponds exactly to the amount of the budget that my wife oversees. Her spending categories include: groceries, child care, miscellaneous, clothing, gifts, and eating out. I also opened a savings account at ING Direct (to take advantage of another bonus) and linked it to her checking account. If she has a surplus at the end of the month, she can transfer it to ING.
The biggest advantage of separate accounts is that we each know our exact balance when we make a purchase. I primarily use online billpay and Mrs. Rocket primarily uses a debit card and writes a few traditional checks.
I think it is important to note that while we have divided up certain financial responsibilities in our household, our money belongs to us and all of the purchases are made by both of us. WE work as a team to decide how to best spend our money together. There are no secrets, we are both able to log in to the others account and if one of us has trouble meeting our portion of the budget in any particular month, we work together to find a solution.
Separate finances can be a source of friction in a marriage, in fact, it is the number one reason cited for separation. Mrs. Rocket and I are in this for the long haul, so even though we use his and her checkbooks, our finances belong to us.