Should a Married Couple Invest Separately? - Henssler Financial (2024)

FAQs

Should a Married Couple Invest Separately? - Henssler Financial? ›

At Henssler Financial, we feel it is important that each spouse maintain their own checking account and manage their own investment accounts; however it is important that they establish core values that blend together, rather than conflict with each other.

Do we have the same financial priorities? Maybe your goal in investing is to retire comfortably, while your spouse's goal is to pay for college. If your priorities are totally different, then it could pay to keep separate brokerage accounts so you can each invest for the things that are important to you.

“Even if you have separate accounts and separate investing styles, it's best to have annual financial reviews done by a shared financial advisor,” said Kirkpatrick. “Having someone look at all your accounts together is important.”

Key takeaways. Keeping separate bank accounts after marriage could help you stay engaged with your money. Paying for shared expenses could mean using bill-splitting apps and extra planning for emergencies, but it's worth it for some couples.

Split bills by income

Consequently, many opt to split bills proportionally according to each person's income. For example, if Person A makes $6,000 per month, and Person B makes $4,000 per month, their total income is $10,000. Person A earns 60% of that, while Person B brings in 40%.

Having a separate bank account in marriage gives you a sense of financial independence, self-identity and empowerment. You make more than your spouse. I have friends who out-earn their husbands by a considerable margin and don't like the idea of splitting the difference, no matter how educated or progressive they are.

With joint accounts, spending can be easily viewed by both spouses, and that level of openness can be reassuring. Though those with separate accounts also may have open and honest relationships, it may be that the most harmonious relationships tend to lean toward joint accounts.

They don't get caught in analysis paralysis and are good about making decisions for themselves. If you have a handle on your financial life, feel confident in navigating the material available to you, and enjoy doing it yourself, there is no point in hiring a financial advisor. You already have it well under control!

Whether you should consider working with more than one advisor can depend on your overall goals and financial situation. If you're fairly new to investing and you haven't built up a sizable net worth yet, for instance then one advisor may be sufficient to meet your needs.

Key Questions To Ask a Potential Financial Advisor

Understand their fee structure and any potential conflicts of interest. Consistency of fiduciary duty: Do you always act as a fiduciary, even when selling commission-based products?

What is financial infidelity in a marriage? ›

Financial infidelity is a term many people are not familiar with, but it can have serious consequences in marriages and relationships. Financial infidelity occurs when one partner hides or misrepresents financial information from the other, such as keeping secret bank accounts or hiding purchases.

39% of couples had combined all their finances, 39% kept things completely separate, and 22% did a partial combination. A final survey I can bring to your attention is conducted by creditcards.com with a sample size of 2,404 adults. In their survey, they found that 43% of couples had only joint accounts.

Make a list of all your combined expenses: housing, taxes, insurance, utilities. Then talk salary. If you make $60,000 and your partner makes $40,000, then you should pay 60 percent of that total toward the shared expenses and your partner 40 percent.

The most common way to use the 40-30-20-10 rule is to assign 40% of your income — after taxes — to necessities such as food and housing, 30% to discretionary spending, 20% to savings or paying off debt and 10% to charitable giving or meeting financial goals.

The 50-30-20 budget rule states that you should spend up to 50% of your after-tax income on needs and obligations that you must have or must do. The remaining half should dedicate 20% to savings, leaving 30% to be spent on things you want but don't necessarily need.

Here's the strategy: Both of you are to keep separate checking accounts and open a joint account from which you'll pay all shared expenses. This joint fund will be a testing ground to see how you commingle your finances. The division of your cost of living should be based on your incomes.

By having accounts at multiple firms, you can access a broader range of quality features. This can let you choose the platforms and tools that align best with your preferences and trading style.

Why both spouses should open an IRA separately. While you're still able to contribute to a retirement account, it's worth maximizing both your IRAs to receive the greatest tax benefits.

Holding your investments at a single financial firm can help provide a complete view of your portfolio. Seeing all your investments in one place may help you track potential tax opportunities more effectively and reduce fees and commissions.

Under California's community property laws, marital assets, including investment accounts, are typically divided equally between spouses.