Linking of Bank Accounts
There is growing awareness of the dangers that come with owning a joint bank account, in an age where many relationships start online, with enormous potential for romance-linked frauds. Horror stories abound where merger of finances completely with someone else, didn’t end well. A recent survey of 4,000 British women found that 40% of women aged 16 to 34 confirmed an equal role in management of household wealth. Most young women are keen to enjoy their financial independence and may own assets they would rather not compromise. Most work hard and in their early 30s, they own a two-bed flat, have very good credit scores, and some savings/investments. However, a Stockholm University study found that joint economics between couples resulted in better communication, stronger family stability, and team spirit. This works well for older couples and couples living together for decades. Joint accounts are however a major nightmare to deal with in the event of a separation or divorce. And what is worse is that the other person dumps you and cleans out your account before you know it! Think carefully before operating joint accounts.
More Awareness Needed of Pitfalls
In the UK and USA, opening a joint account in a bank as any unwed couple is no different from those opened by married people or folks in civil partnership. The most important questions are: Any chronic debt problems? Does your partner regularly rely on their overdraft? Any outstanding balances or hire purchase or loans on credit cards, any pay later agreements you should be aware of? Is their credit rating poor? If the answer to any of these questions is yes, do not venture there! You become jointly liable should your partner run up an overdraft. If he/she can’t pay back what is owed or pay for extra charges, you take on that responsibility, until you freeze the account, with neither able to have access to it until payments are made. When you decide to go separate ways and wish to permanently close the account, your bank may refuse until all debt is settled, and they will pursue you for the whole amount if the other party isn’t tracked down. Your partner could grab money in credit and if that happens, you have no recourse. If in doubt, insist on keeping finances separate. The sentimental notion of ‘what’s mine is yours’ in our culture isn’t practical in the modern world when people land in messy financial situations, and their problems soon become our problems.
Maintain personal bank account
Money is a way of having power and control in cases involving domestic violence and abuse. An often used tactic of abusers is to cut off the partner from funds by not allowing access to personal accounts and credit/debit cards. This prevents victims from leaving the abusive relationship. Family wisdom dictates a woman to have secret stash of money if she needs to flee a relationship. If you have trauma from a past relationship, but are now in a healthy one, keep a personal savings account with just your name, which your partner cannot access. Do express this to your partner so that you have at least one, non-joint account. Never give up your own bank account in any relationship. This seed money for a new life could be the difference between continuing a miserable relationship and liberating yourself for a fresh start.