Together & Separately
When you get married, does that mean you should become financially dependent on each other? I don’t think it should.
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 money melding. Coupling doesn’t mean make yourselves ONE; coupling means making a new economic unit. It means each person brings his or her strengths to a relationship. It doesn’t mean giving up your financial identity to the family unit; there’s no strength in that!
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, and individuals typically come with different risk personalities, time horizons, and goals, keeping your savings separate is a nod to that independence you need to maintain to be a healthy couple.
And 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 the line. No joint credit cards, ev-ah! And no co-signing for buddy because he or she can’t qualify on his or her own. If your bestie can’t get the loan it means he or she shouldn’t have the loan.
I’m not sure where the idea came from that we need to merge all our money to be totally committed to a relationship. 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.
Listen, I’ve been married three times. I’m hear to tell ya that it doesn’t matter how much you love a person, crap happens. If you think you’re immune to said crap, you’re living in a dream world. Death, divorce, unemployment are realities a lot of people have to live with. Make sure you’ve got a strong financial identity so no matter what life throws at you, you can stay strong.