How To Combine Bank Accounts

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Joining bank accounts can be a tricky step in any relationship. Do you combine all accounts or only have one combined account? Combining bank accounts can make it easier to pay shared expenses like mortgages, utilities, or food. It also facilitates savings for shared goals like a vacation, a mortgage down payment, or a new car. Some couples choose to combine all their bank accounts, while other couples combine some accounts and also keep separate accounts. 

Whichever route you choose, having at least one combined bank account can make managing finances and working towards financial goals easier. 

Reasons to combine bank accounts

If you’re combining bank accounts, we’re assuming there is already a high degree of trust in the relationship. In most cases, it means you’re either married or have a long-term partner. It’s important to share a bank account with someone you trust. 

Even in long-term relationships, financial planners tell horror stories of things gone wrong when merging bank accounts. That’s why you want to talk about money management, budgets, and financial goals before combining bank accounts. After you’re both on the same page and you’ve agreed on the ground rules, joining bank accounts offers significant benefits. Here are a few.

Shared access

As partners, your money is theirs, and vice versa. When you both have access to funds, it makes it easier to access the funds when they’re needed. You’ll be able to share responsibilities for making regular payments for utilities, groceries, and other expenses. Whether you add your spouse to a bank account or create a new joint bank account, shared access will make sharing funds easier. 

Paying bills becomes easier

Paying bills is simplified because there is no need to calculate when it’s coming out of one bank account. If you’re splitting the bills, you don’t have to worry about who has paid what. The funds are in the account and ready to go. 

Simplify finances

Speaking of simplifying payments, after combining bank accounts or adding a spouse to a bank account, you might want to set up an automatic system where a percentage of both partners’ paychecks or an agreed amount is automatically transferred to the combined bank account. It also makes it easier to see what you’re spending money on when setting a budget. When you automate finances with a combined bank account, you can see where your funds are going and work towards shared goals. 

Greater transparency

As a couple, you’ll be working towards all types of goals together, from big savings goals for a mortgage down payment or college tuition to smaller goals like a vacation, a new car, or college savings. When you combine bank accounts, you can both see where you are on all your goals.

For that reason, it’s helpful to have a combined savings account and a combined checking account. The checking account will cover the day-to-day expenses from utilities and house payments to kids’ activities and clothing. The savings account can be used for different savings goals. You may also want to have one or more retirement accounts, in addition to employer-offered 401(k)s and other retirement plans. 

How to combine your bank accounts 

When combining bank accounts, each couple needs to choose what works best for them. The main thing is to communicate needs and expectations and keep adjusting as needed. Combining bank accounts requires just a few simple steps. If you’re ready to get started, here’s how to merge bank accounts.

Contact your bank

You can combine bank accounts by creating a new joint account or by adding someone to an existing account. Both will have the same effect. Some banks offer incentives for new accounts with automatic payments, which can make opening a new account enticing. On the other hand, if you already have more than enough bank accounts, adding your spouse to an existing account is a simple solution. 

In either case, you’ll usually both need to visit the bank with a government-issued photo ID and any other required documentation. Ask your bank what you need to bring and whether you need to make an appointment or can walk in. 

Move resources

To make the new combined account work, both parties will need to move money into this account. Initially, you can transfer funds from existing accounts into the newly combined account. After that, it’s easier to set up automatic deposits from each paycheck or to make regular transfers on an agreed day (like the first of each month). 

Redirect deposits

Direct deposits into the new joint account will help automate and simplify your combined finances. It ensures that the account always has enough funds to pay off bills, groceries, and other regular expenses. From the direct deposit, you can then redirect a portion of the funds to savings, investing, or other financial goals. 

Set up automatic withdrawals

If you have enough funds in the account, you can also set up automatic withdrawals for utilities, rent, mortgage, and credit card payments. Having your bills on automatic will help keep you from making late payments. Beyond paying off debt, ensuring on-time payments is one of the simplest things you can do to build your credit score over time. 

Close accounts no longer in use

If you’ve moved over your assets, you may not need your old bank account anymore. Then it’s time to close those old accounts. On the other hand, it’s possible you also want a private account. Many couples prefer to have combined accounts as well as private accounts for each person’s discretionary expenses.

Final thoughts on how to combine bank accounts

How to merge bank accounts will look different for every couple. The key is clear communication of expectations and goals. Keep checking in regularly. You might prefer to add a spouse to a bank account as a way of joining bank accounts. Or, you may decide to open a new shared bank account and keep separate accounts. Whichever route you choose, automating payments, withdrawals, and building a budget will help you work towards financial goals together.

FAQ

Is combining bank accounts a good idea?

Yes, for most households having at least one combined bank account can simplify finances, improve transparency, and help work towards financial goals.

Why do rich people have multiple bank accounts?

People find advantages to having multiple bank accounts. It can be a way to better manage funds for different goals (like savings, college, everyday expenses, etc.). Usually, each account comes with deposit protection, which can offer additional financial protection in case of bankruptcy.

When should you combine bank accounts?

When you should combine bank accounts will vary for each couple. However, if you have shared household expenses and are in a relationship, it is often convenient to have at least one shared bank account.

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