Years ago I read an article by Gail Vaz-Oxlade where she spoke about encouraging couples to have separate identities when it came to finances. It still holds true today.

She stated, "Coupling doesn’t mean make yourselves ONE; coupling means making a new economic unit."

I had to admit, Gail got it right. She didn’t encourage couples to live separate lives, but rather, maintain a separate financial identity. We are recognized as individuals when it comes to credit history, the government, and lending institutions, so why do we feel we need to merge every aspect of our lives?

Stuff happens in life. Sometimes it comes in the form of death, but it also can come in the form of disabilities, divorce or unemployment.

So many widows and widowers who relied heavily on their spouses to "handle" the financial end of things are so lost and confused when they are most vulnerable. We are seeing couples divorcing, not just after 5 years, but after 30 and 40 years of marriage. With frozen bank accounts and credit cards, many are left in a lurch because they don’t have access to cash, or do not qualify for credit to help out in the transition.

Having separate accounts keeps both of you engaged in what is going on with ALL your finances. My husband and I decided right from the beginning to each have our own separate finances…together! We each have access to the other’s accounts, banking info, and credit cards, but what it does is help keep our financial identities separate. We can still work together and make joint decisions on our financial plan and retirement goals without pooling everything together.

Separate accounts do not mean we are not invested in the relationship. It’s really about mitigating risk.

"Joint accounts are great for dealing with the monthly fixed expenses like your rent or mortgage, utilities, food, insurance and the like. But savings… well, savings should be a thing you manage individually", says Gail. Great advice!

There are huge advantages to having separate financial identities when "life" happens so that you are not tied to your partner's credit history. When coaching my real estate clients, I always talk to them about the importance of securing a strong credit score. See my post on Improving Your Financial Life After Divorce.

The key is to have a healthy balance between partnership AND being your own person.