Lili’s Tips: The Truth About Separate Finances in a Relationship

Fact: It’s important to have some of your own money.  Partners should have some discretion and enjoyment with ‘play’ money. However, everybody usually feels better with some amount of money to keep in a stash, or spend in a way they do not have to explain.

PROS

1. Give yourself your own credit identity & history – this starts with your own basic checking account, your own secured credit card, and any rent/lease/purchase contract in your own name.
2. You may have retirement accounts in your own name by law. No joint ownership permitted.
3. You need some control and autonomy; a sense of a little bit of financial independence
4. Avoid conflict over the small purchases and budgeting
5. Power dynamics – where there are power imbalances, separate finances may be one way to level the playing field (or make it worse)
6. Income disparities and allocating expenses of running a household based on pro rata contributions
7. One spouse has significant debts and there are anxieties around protecting other spouse from creditors
8. Privacy
9. To prepare for worst case scenario: divorce

CONS:

1. Lack of communication
2. Distrust
3. Money becomes a weapon of control
4. Could heighten arguments over how to spend money and who contributes how much
5. May allow for mismanagement of money because of an unreliable partner