Bryan Keogh at The Conversation: My fiancée and I recently opened our first joint checking account. It was quite a milestone in our relationship, since both of us prize our financial independence, but we felt it was important to help us manage our spending together and ensure transparency and equality. It was time to think in terms of “our money.”
And it seems the research backs us up: “By turning ‘my money’ and ‘your money’ into ‘our money,’ a joint account can help to reduce scorekeeping within a relationship,” University of Michigan marketing professor Scott Rick writes, citing data from a survey of committed couples he conducted with colleagues. “Couples that manage to stave off a tit-for-tat mindset tend to be happier.”
Younger couples, however, are increasingly opting out of the joint account idea and keeping their finances separate. That may not be entirely a bad thing, Rick explains in one of last week’s most engaging articles. That’s because “complete transparency can be harmful for couples.”
He suggests couples pursue both strategies: Joint finances to encourage equal access to “our money,” but keep those separate accounts to allow some level of privacy, autonomy and individuality in purchases.
We hadn’t read his article, but that’s pretty much what my partner and I decided to do. As Rick notes, it helps “strike the right balance between financial and psychological well-being.”
According to Scott Rick at The Conversation: As a behavioral scientist who studies money and relationships, I find that joint accounts can bring partners closer.
There are some risks, however. Joint accounts create transparency, and intuitively, transparency feels like a good thing in relationships. But I argue that some privacy is important even for highly committed couples – and money is no exception.
The newlywed game
Behavioral scientists Jenny Olson, Deb Small, Eli Finkel and I recently conducted an experiment with engaged and newlywed couples. Each of the pairs had entirely separate accounts, but they were undecided about how they wanted to manage their money moving forward.
We randomly assigned each of the 230 couples to one of three groups. One group kept their money in separate accounts; one merged their cash into a joint account and stopped using separate accounts; and one managed their money however they liked.
We followed couples for two years, periodically asking them to complete surveys assessing their relationship dynamics and satisfaction. Our relationship quality measure included items such as “I cannot imagine another person making me as happy as my partner does” and “Within the last three months, I shouted or yelled at my partner.”
Among the couples who could do whatever they wanted, most kept things separate. They and the couples assigned to keep separate accounts experienced a steady decline in relationship quality over time.
This is a fairly typical pattern. For instance, in a large study that tracked U.S. couples’ marital happiness for 17 years, sociologist Jody Van Laningham and colleagues found that “marital happiness either declines continuously or flattens after a long period of decline.”
Declines during the first two years of marriage are particularly important. Social scientist Ted Huston and colleagues call those first two years the “connubial crucible.” They find that relationship dynamics that develop during that crucial period can foreshadow relationship quality for many years to come.
Couples in our study who were prompted to take the plunge into a joint account, however, maintained their initial level of relationship satisfaction over the course of the two-year experiment…
More here.
