My wife has her own checking account

by Rocket Finance

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.

  1. 22 Responses to “My wife has her own checking account”

  2. By plonkee on Jan 18, 2008 | Reply

    Sounds like you’ve got a great set-up. I wouldn’t get too hung up on doing what other people tell you is the best thing to do, if it works, then it’s right.

    Personally, I think it’s a trust issue to have separate accounts. As in, you (naturally) trust Mrs. Rocket not to mess up her account and to put it to work for the whole family, and likewise she trusts you to do the same with your account.

  3. By rocketc on Jan 18, 2008 | Reply

    I have had more than one person who I respect, tell me that separate finances are a bad idea. But as long as there is communication, I don’t think it will become a problem.

  4. By LittleSis on Jan 18, 2008 | Reply

    I think that makes a lot of sense.I’m showing my husband this post right now!

  5. By rocketc on Jan 18, 2008 | Reply

    Proceed carefully. .. the set-up can work for you if you are honest and really try to work together.

  6. By rocketc on Jan 18, 2008 | Reply

    Oh, and don’t open an account without a bonus!

  7. By LittleSis on Jan 18, 2008 | Reply

    We already have 2 checking accounts since we just got married. I think it can be effective especially if you really limit and only carry the debit card for your account – it helps you stick to the budget that way. Who knows if we’ll do it at this point – we’re rolling in the dough anyways. 😉

  8. By ArdenLynn on Jan 19, 2008 | Reply

    This is the exact way we have our household finances set up.

    I don’t know what the experts say but we have been married for 17 years and we have 7 children.

  9. By rocketc on Jan 19, 2008 | Reply

    I always wanted a big family, but now that I have 3 kids, I can’t imagine having any more. Of couse our youngest is only 10 months at the momemnt. . .check back in a year. 🙂

  10. By Aaron Stroud on Jan 20, 2008 | Reply

    Rocketc, your title is deceptive! But I confess, it guaranteed my attention (I’m trying to skim through 200+ posts).

    I think you two have separate electronic envelopes, not separate accounts. This is no different from one spouse carrying an envelope for groceries the other spouse watching over the envelop for the utility bills, etc.

  11. By rocketc on Jan 20, 2008 | Reply

    I think you are probably correct. This is the way we look at it.

  12. By Danielle on Jan 22, 2008 | Reply

    My husband and I are just now consolidating things after getting married last year.

    I would like to point out that the problem of not knowing exactly how much money you have to spend can happen with single person with a single account as well. Large bills change in amount and due dates can move around due to changes in the billing cycle.

    One thing we are trying right off the bat is to get any large and regular payments that we can’t control the due date of out of our joint account.

    On Pay Day our savings comes out automatically and we will transfer the amount needed to cover those large and regular bills to a separate place. Any other debts we have (credit card right now) can be sent on the pay day before it is due.

    We also have a line of credit $1000 we can go into if we make a mistake. I’m not sure I would follow this plan if a mistake ended up in an overdraft fee!

  13. By rocketc on Jan 22, 2008 | Reply

    It is good to have some kind of overdraft insurance in place. Most banks will do something like this for free.

    I am annoyed at how much companies move their due dates around.

  14. By TwoLivesTooHappy on Jan 24, 2008 | Reply

    And two accounts. We both work, we both have debts we brought into the marriage (just past 1 year together!), and we both have our preferred ways to spend the money we have for ourselves. There is a joint checking and joint (high-yield) savings account, but we contribute to those from our separate accounts. There has never been a problem about money for us, & we help each other if anything is ever short, but separate accounts mean we can save for our personal goals at our own pace. Also, if I want to blow $300 to get him that one thing he keeps putting off for himself as a birthday gift, individual accounts mean he doesn’t think about where “we” are going to cut back to afford it.

  15. By rocketc on Jan 24, 2008 | Reply

    That is an interesting point about getting gifts for each other. There was time when I would receive a gift and knew that it would show up on our credit card statement at the end of the month. . . 🙂

  16. By corrin on Jan 24, 2008 | Reply

    good for you two.

    i handle the finances in our family and all paychecks are direct deposited into my checking account. after all bills are paid, allowances are distributed and the rest goes into savings. we initially did it this way because my husband isn’t exactly a whiz with money and he thought he would do better receiving a set amount each payday.

    it works so far!

  17. By Livingalmostlarge on Jan 28, 2008 | Reply

    Sounds like a good system. It couldn’t work for me because we leave little fat in the checking account, but sounds good.

  18. By cliff on Jun 6, 2008 | Reply

    My wife and I had separate checking accounts for the first 7 years of our marriage. Last year we switched to a joint account because we thought it would make things easier. So far it has worked out quite well.

    The key to success, though, is to always maintain a balance in your joint checking account which is sufficient to cover 1 month’s expenses.

    Example: If you know that your monthly expenses are usually around $4,000 and you make $5,000/month, then you should have $4,000 in the bank on thelast day of the month (assuming you get paid on the 1st and 15th). When you get paid on the first of the month, you will have $4,000 + $2,500. By the 15th, you will have spent down some of the account (say $2000 for the first half of the month), but you will get paid again and you can replenish the account (hopefully you will have $4,000 + $2,500 – $2,000 + $2,500 = $7,000. Then at the end of the month (after you spend the remaining $2,000 of monthly expenses) you will end up with $5,000 on the last day of the month. Then you can transfer $1,000 to long term savings and start the process over with the remaining $4,000. This works perfectly so long as your income exceeds your expenses (which it should). This way, there is virtually no way you can overdraw your account (unless you REALLY blow your budget) and you should always have something left at the end of the month to transfer to savings.

    True, you could get a higher yield by keeping the money in a savings account, but the peace of mind of never bouncing a check or getting an overdraft and the savings from only having 1 account instead of 2 tends to offset the $10/month or so of lost interest.

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