Why Millennial and Gen Z couples aren't putting all their money in joint bank accounts

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May 31

Erin McCarthy | The Philadelphia Inquirer (TNS)

Reema Malhotra-Phillips never considered giving up her bank account when she got married last year.

"As a woman I think it's important to have financial independence," she said, even though "I am planning on being with my husband until the day I die."

When they bought their home in Philadelphia's Fishtown neighborhood, the Phillipses did open a joint account to pay the mortgage and bills. They also take money out of that pot for vacations and other shared experiences.

But they keep the rest of their finances separate.

"I use my personal bank account for anything that doesn't involve our home or something that my husband would be partaking in," said Malhotra-Phillips, who works in sexual violence prevention education at the University of Pennsylvania. The personal card is swiped "when I'm out with my friends, when I'm at lunch at work, when I'm buying him gifts or other people gifts."

Millennials like Malhotra-Phillips, 31, are more likely than other generations to keep at least some finances separate from their partners.

In a national survey of couples who live together, are married, or are in a civil partnership, almost 70% of millennials — who are in their late 20s to early 40s — told Creditcards.com, an offshoot of Bankrate.com, that they had at least some separate accounts. That's compared to 64% of Gen Zers, who are under 28, as well as half of Gen Xers, who are in their mid 40s to late 50s, and half of Baby Boomers, who are in their 60s and 70s.

"It's just really an evolution of roles in the family," said Jacky L. Petit-Homme, a certified financial planner and cofounder at Liberty One Wealth Advisors in Philadelphia. "Once upon a time, one partner worked and the other didn't. So there wasn't really finances to combine." In those situations, all accounts needed to be joint, he added, so the nonworking partner could access money.

But over the past 50 years, the percentage of women in opposite-sex marriages who make roughly as much or more than their husbands has tripled, according to the Pew Research Center.

Emily Goodman, who works in sales, owns several properties and a small business, Dye Hard Fan, that sells Philly sports-themed apparel. She never considered fully combining her finances with her husband, who works in pharmaceuticals, but they did set up joint checking and savings accounts for home expenses, utilities, and, recently, preparations for the arrival of their first child.

"We wanted something that we call ours," she said. But they didn't want that setup for everything.

The 30-year-old Collegeville, Pennsylvania, resident said she thinks many young couples today have different attitudes toward money than their parents.

"My parents see our finances like, 'What's yours is your husbands,'" Goodman said. "I just don't see it that way."

How couples split shared expenses

Some couples say it wasn't hard to decide whether to officially combine finances. But regardless of whether the money is put in a joint account or Venmo'd back and forth, they grapple with how to split shared expenses: Should they go 50/50 or choose a different ratio based on who makes more money?

"The big thing we debated was how much money we were going to put into the joint account," Malhotra-Phillips said. "It was important to us that it was equitable."

The Phillipses decided to automatically deposit half of each of their paychecks into the joint account.

Sydney Rae Chin, 26, of Philadelphia, got married last year and has been living with their husband for three years. The couple keeps separate accounts but plans to eventually get a joint account to work toward shared goals, like buying a home.

When it comes to splitting expenses, they use a ratio system that they reassess based on how much each person is making at the time. Recently, for example, Chin was in a culinary job training program and not making money, so they contributed about 30% to living expenses, while their husband contributed the other 70%.

"This was something that we talked about for a bit," Chin said. "50/50 didn't really resonate with us."