Be my Valentine: Are you and your partner ready for a joint account?

Key takeaways:

• Learn how clear communication about your finances can strengthen your relationship.
• Opening a joint account can alleviate stress when paying household bills.
• Voicing your financial goals early on can help your relationship.
• Empowerment in your financial situation can help you focus on what really matters to you.

Finances play a large role in your relationship with your significant other. Healthy and successful relationships start with upfront communication about finances.

According to one study, couples who argued about finances once a week were 30 percent more likely to get a divorce than couples who reported disagreeing about finances only a few times a month. To dig even deeper, it’s miscommunication about money issues between partners that is the ultimate culprit.

That is why it’s important to keep communication top-of-mind if you’re thinking about committing to a joint bank account. A joint account can be a great way for you to work together towards your individual and collective financial goals, while also allowing you to easily share joint expenses such as household bills or childcare expenses without having one person pay more than the other.

Financial topics to cover

However, it’s not a decision that should be taken lightly. Before you proceed, consider discussing some of these basic financial topics to determine if you’re aligned:

Current spending and budgeting habits

It’s important to understand how much your partner is spending and what he or she is spending it on. Are you two are on the same page when it comes to how you like to spend your money? Do you both have similar budgeting habits? If not, consider creating a budget that you both maintain together.

Debt

If your partner has debt, he or she is likely going to use a large amount of his or her income towards paying it off, which could result in more household expenses falling on you and cause friction later. If this is the case, suggest he or she set up an appointment with a financial coach to help create a plan for getting out of debt.  

Credit score

Bad credit can cause problems when you’re making joint purchases, including an increased mortgage payment if you choose to buy a home together. If you have concerns about your credit worthiness, schedule a meeting with a MidWestOne personal banker to talk about ways you can improve your credit.

Financial goals

Do you both have the same ideas about retirement or the amount you’re spending vs. saving? Don’t assume you’re aligned. Start planning for your joint financial future and work towards reaching those joint goals.

Setting up a joint account

If – after discussing the items above – you both decide to set up a joint account, the next step is to visit your local banker.

At MidWestOne, you can set up a joint account in a similar way to opening your personal account. You’ll provide your banker with personal information for you two, and he or she will assist you in opening your account. Prior to consulting your banker, consider discussing what type of account you’d like to open. You can compare the different accounts at MidWestOne.com.

Your newfound financial habits shouldn’t end after setting up your joint account. Remember to make your finances a joint effort and set aside time to discuss money.

If you have questions regarding opening a joint account, the MidWestOne team can help. Stop in to see us at any of our locations.

MidWestOne Bank does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

Member FDIC