Does having a joint account with your partner make you less of a feminist?

I’m a feminist. I’ve written a book on feminist finance, “Well-Heeled,” covering critical subjects like pay equity, the nuances of building wealth as a woman and choosing your partner wisely, which happens to be one of the most critical factors in financial success. 

But I still have some joint accounts with my husband, and I’m no less of a feminist for it. 

The debate to join accounts or have separate banking has been going on for decades, and the truth is that either structure can work. The key is to ensure your money method works for you. That way you’ll stick with it.

What never works is if the banking structure prevents a woman from building her own credit, if it is being abused (one partner controlling the other), if there’s no growth in household net worth and if it isn’t transparent.

I’ve rounded up a few top tips that have worked for me and my community, no matter which path you take. 

Keep your account structure simple

Too many accounts can be confusing to track. In the worst case, they enable partners to hide money from each other, so keep it simple. (If you’re going joint, this structure below is for your household and if you’re going separate, each partner applies this structure individually):

Basic banking: One chequing (for paycheques and bills), an emergency savings account (I recommend a HISA), and a sinking fund (a no-fee savings account for short-term savings needs like vacations or annual tax bills). 

Credit cards: One primary card with rewards that matter most to you (eg. travel or cash back) and one secondary card. Ensure they are not both from the same credit card company. In the event one vendor isn’t accepted, say Mastercard, you’ll want to use your backup VISA or Amex. 

I can’t stress this enough! To build credit, you need to be a primary cardholder. And you also need to be named as the primary signatory on bills and loan agreements. It is not enough to be a secondary card holder. If you’re going joint, make sure one of these credit cards is under your name. And ensure your name is on a few recurring monthly bills; that means you are the owner of the account.

Investment and retirement plans: RRSPs and TFSAs are registered individually via your respective SIN numbers, and you’ll want both styles of accounts. Even if you’re doing separate banking you can still have the same advisor or financial planner, though some couples prefer to separate their advisors, too. That’s cool, as long as you’re both hitting the optimal level of returns for your respective risk profiles, and you have a financial plan for retirement.

If pensions or savings programs are available through your workplaces, and they have a matching component, each partner should sign up to maximize the match. Non-registered investments accounts can be solely or jointly held, and typically you’d introduce this kind of account once your RRSPs and TFSA limits are reached. 

Use a budget and net worth tracker to set boundaries

These tools help couples communicate, plan for the future and share financial information. You’ll know your budgeting system is working if your household net worth (total assets minus total liabilities) is growing every month and you’re staying out of debt.

If you’re going the separated banking route, you’d set up individual budgets, noting sources of income and all expenses, and net worth trackers. Both tools should be updated monthly. The modern approach to shared household expenses is to divvy them up based on proportional income. So if Partner A earns $100,000 annually, and Partner B earns $50,000, Partner A covers two-thirds of the household costs and Partner B covers one third. Going 50/50 is punitive to the lower-earning partner.

Joint banking typically makes budgeting and net worth tracking a bit easier; the sources of information are shared.

Book a monthly money date

Talking about money at least once a month encourages transparency, creates a platform to resolve issues and helps couples stick to their budget(s). Use this time to review spending, troubleshoot any budgeting issues or dips in net worth, set goals, dream together and become financially literate as a couple.

If you’re locking horns, hire a relationship counsellor or a money coach that specializes in supporting couples. You can’t plan your future without communication. And no, joint accounts won’t fix financial disagreements. Getting on the same financial page will.

What about the “efffff-off” fund, so often spoken about on talk shows?

The fear is needing to leave the relationship, but not having any money to make it happen. Or one partner cleaning out the savings account, then leaving the other partner with nothing. This gets resolved down the road through mediators, lawyers, etc. but for that crucial raw moment in time when the split happens, it’s not a good situation.

My advice is to always have access to between two to three months’ worth of your income available to you at a moment’s notice. If you never need this money, great. But perhaps your daughter or sister might need it down the road. 

As feminists, let’s empower women to choose the banking system that works best for them, and encourage continued financial literacy along the way. 

This article was originally published in The Star. Lesley-Anne Scorgie is a Toronto-based personal finance columnist and a freelance contributing columnist for the Star