A joint bank account may be the spice of (marriage) life. According to the author of the new book, A research paper published earlier this yearCouples who want their honeymoon to last longer should consider consolidating all their bank accounts into a joint account.
Relationship quality has been found to peak around the wedding day and then decline sharply over the next two years. Although we may know this colloquially as the “honeymoon period,” researchers have coined the term “the melting pot,” and the relationship dynamics during this period are fairly predictive of long-term well-being and the rate of marital failure.
Couples who were told to merge their bank accounts into a joint account were able to avoid any decline in relationship quality for two years after their wedding. Conversely, couples who were instructed to keep separate bank accounts and couples who weren’t instructed at all both showed the standard decline in relationship quality. (Of the couples who were given no instructions, 72 percent of them chose separate accounts themselves, and of the 28 percent who chose joint accounts, most set them up one year after him in her two-year study.)
What’s particularly surprising about this study is that it’s the first paper to draw a causal link between how couples open bank accounts and their impact on relationship quality. Previous studies had already found that couples with separate bank accounts were less likely to be satisfied with their relationship and more likely to break up than those with joint accounts, but those papers showed correlation, not causation.
That distinction is very important. for example, Ice cream sales and shark attacks could peak in summer (correlation), buying ice cream does not cause shark attacks, nor does shark attacks cause people to buy more ice cream (causation).
So far, jurors have been undecided about whether participating in bank accounts improves the quality of relationships, or whether people with better relationships are more likely to open joint accounts. The paper shows that, on average, combining bank accounts results in better relationships.
So why might joint bank accounts change the dynamics of relationships? Researchers suggest three potential mechanisms: improved feelings about money management, alignment of financial goals, and continued adherence to community norms.
Couples in community-oriented relationships tend to offer support to each other because their partner needs support, whereas exchange-related relationships are characterized by offering support as a means of paying up front for future favors. The former leads to improved long-term relationships, shared responsibility, mutual support, and encourages a “we” rather than a “me” mindset.
However, while the decision to merge financials can have positive implications, it is important to remember that every situation is unique. On average, bank account consolidation had a positive effect on relationship quality, but this doesn’t mean everyone should rush to fully consolidate their financials, the authors warn. In some cases, maintaining a separate account may act as a form of financial protection.
Dr. Jenny Olson, lead author of the paper, said: For example, remarried partners, partners with children from previous relationships, older couples, etc., who generally have relatively more complex financial histories than first-time newlyweds. ”
The author of this book, Alyssa Davis economical first aidadds that the ultimate goal of a healthy relationship is finding ways to work as a partnership or team. But there are many good reasons for segregating some banking transactions, and just using a joint account can be risky.
“If something happens and you break up with your partner, you’re putting yourself in danger. It’s perfectly fine to protect your future and past selves. If you’ve been through something traumatic or want to feel secure in managing your money, that’s fine. And having a partner who gives you the space and understanding to work through this kind of financial trauma is important,” says Davis.
She suggests that partially combining bank accounts could make a lot of sense for some couples. “Even if you share an account or credit her card, you can give yourself access to your own money as a personal emergency fund, or you can each give yourself a fair share of your income as discretionary money,” says Ms. Davis.
Priet Banerjee He is a consultant in the wealth management industry with a focus on commercial applications of behavioral finance research.
