Lehman Brothers Bankruptcy and Merrill Lynch Buyout – What Do They Mean to You?

Lehman Brothers declaring bankruptcy and Merrill Lynch being bought by Bank of America all in one Monday?  Who knew when they woke up today the financial turmoil the day had in store?  Aren’t you getting tired of days like these, I know I am.

How Does it Effect Your Investments?

Amidst the craziness, US News and World Report takes a look at how the financial circumstances of Lehman Brothers and Merrill Lynch could effect you.  They cover the impact to stock investors as struggling banks fight to raise capital and stay solvent.  The article also covers the potential impact of today’s events on how the Fed might handle interest rates. 

Days like today make me glad I’m diversified across industries and investment categories, I’d certainly hate to have a big chunk of money invested in LEH stock.  Looks from reports on Bloomberg like the pieces of the company are being broken off and sold as quickly as possibled before all the employees can jump ship.  I don’t imagine the career page at Lehman will get many visitors in the coming weeks.

What Will it Mean for Your 401k?

My first thought when I heard the news about the Chapter 11 bankruptcy and buyout was that I didn’t even want to know what my 401k looked like today. Emily Brandon of US News talked to three financial planners about how the financial mess could impact 401k investors and Merril Lynch customers.

Their advice for 401k investors basically says if you’re invested for the long term then just ride it out.  I’d also add, watch out for scammers!  When the markets are jumpy and investors are running scared, people are more likely to do illogical things.  Look out for people trying to make a quick buck at your expense off of the uncertainty.

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FNBO Direct Online Savings Account – Another Option for a High Yield Savings Bank Account

FNBO Direct offers an online banking account with competitive rates and is one of the options I’m considering in my search for opening an online savings account. We currently have all of our cash reserves with ING Direct and I’m looking to move some of it to another bank that offers better rates.

First National Bank of Omaha

I didn’t have FNBO Direct as one of my options until we visited some family in Omaha this weekend and I mentioned the bank to one of our relatives. He has both personal and business bank accounts with the First National Bank of Omaha, the parent bank of FNBO Direct, and has been very pleased with the service they provide and the bank as a whole. He’s a busy guy but he agreed to share his thoughts and experiences with the First National Bank of Omaha so I’ll pass those on once he has a chance to offer some more details. 

FNBO Direct

FNBO Direct started out with just an online savings account but has since added other features like online bill pay, a Visa card option, and certificates of deposit. For now I’m really most interested in the online savings account but it’s nice to see they’ve been enhancing their offerings and improving on the product. I think that shows they’re serious about providing options for their customers and that they plan on this product being around for a while.  That’s certainly the impression I got after talking with my relatives, I’ll keep you posted on what I find out about FNBO Direct.

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401k Rollovers – Transferring Your Retirement Investments When Changing Jobs

Rolling over your 401k into an IRA is one of the key financial steps when you take a new job. A job change can be one of the most frustrating and overwhelming times of your life; but it can also be one of the most exciting and fulfilling times of your life! Transferring your retirement accounts during a job change is one of the more confusing parts of a job change, so we’ll work through your options, what NOT to do, and some tips about what to research about your new job’s 401k plan.

How To Rollover your 401k to an IRA

1. Choose a brokerage firm or online brokerage firm to open up a Rollover IRA. ShareBuilder, Scottrade, and Etrade are the most popular online stock brokerage firms that all offer Rollover IRA accounts.
2. If you already own an IRA account, make sure you open a SEPARATE rollover IRA for your 401k contributions. If you keep the contributions in a separate account, it keeps the money eligible for you to roll it back into your new job’s 401k plan if they allow it. If you roll the money into an existing IRA, the minute you contribute your after-tax dollars to it, that rollover money is no longer eligible to be rolled back into a new 401k account.
3. Contact your HR department and fill out all of the necessary forms to start the rollover process.
4. Wait for the money to roll into your new IRA!

Taxes and Penalties for Cashing Out Your 401k Account

It’s very tempting to cash out your 401k account when you leave an old job. However, there are consequences if you take the money and run. If you elect to have a check cut to you for the lump sum amount of the value of the account, you’ll only receive about 60 to 70% of that amount. The lump sum will be taxed based on your tax bracket, PLUS a 10% penalty for early withdrawal. This would be devastating to your retirement account, and it would take years to recover from this tax penalty. DO NOT take this option. Unless you need the money for a dire emergency, resist the temptation.

Things To Consider For Your New Company’s 401k plan:

• 401k Match: Many employers offer a matching program where they’ll match a certain percentage of the money you invest in your 401k plans. If your new employer will contribute a percentage of your investment in your 401k plan make sure you take advantage of this “free money”.

• The vesting schedule: ask your new HR department about the vesting schedule for your new 401k plan. You need to know how long it will take for their matching contribution to be all yours. Sometimes, you can negotiate the vesting schedule if your employment involves signing a contract for employment.

• Investing Options for the 401k: One of the biggest disadvantages of a 401k is that it has limited investment options. This is why I always recommend that people invest in a Roth IRA rather than a 401k if their company does not offer a match. Make sure you get a list of investment options with their detailed information. If the investment options are horrible products with high fees, you may want to skip out on their 401k.

• When Can You Start Contributing?: Every company has a different policy about when their employees are allowed to jump and jump out of their 401k plans. Some companies use a schedule of every quarter, some use twice a year, and some companies make you wait a certain period of time regardless of the schedule. Make sure you know how long you’ll have to wait before you can start contributing to the new 401k.

Systematic contributions to your retirement account will make you a millionaire. If your account suffers multiple lapses without contributions due to several job changes in your lifetime, you could lose out on thousands of dollars over your lifetime. Staying on top of your 401k plan during a job change is crucial. You don’t want to be penalized 10% plus your tax rate simply because you forgot to think about your retirement plan. If you have any further questions or concerns, comment below or contact us.

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Money and Your Job – Considering Finances & Benefits in Your Job Search

As I was looking for a new job I was reminded of how many key personal finance concerns are tied to our employers.  Of course it’s not just how much you’re paid but also things like health insurance, retirement savings, and even life insurance or disability insurance coverage.

Career Finances

The financial intricacies of finding a good employer can be pretty overwhelming and in some cases can be the cause for people staying in jobs that aren’t necessarily right for them.

I heard a piece on the radio a while back that talked about the history of corporate benefits and how they fit into the economic landscape of the United States.  Due to the rising cost of providing these benefits and smaller profits resulting from increased global competition, corporations are cutting back on the benefits they offer.  This leaves us employees the task of maximizing the benefits we can get from our job and learning about what we can do to cover the gaps.

Managing Job Benefits

While there are certainly things you can do to increase your salary, such as learning the company salary policy and promoting yourself you should be sure to consider all the financial aspects of the job you work in.  In the coming days we’ll be covering some of common issues and questions people encounter about benefits and finances when looking for a job.

So far we’ve covered a tool for comparing jobs, tips on determining the cost of relocation if you move for a new job, and some of the expenses of a new job that you might encounter.

Click here to stay tuned for more coverage of career finance.

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How To Determine Expenses Associated With a Job Change

So, you’re ready to take the plunge, and change jobs. Some of you will not only change jobs this year, you’ll change careers. But with every change comes an added expense. Changing jobs can change your life, but it can also hurt your wallet at the same time.

Switching Jobs

On a personal level, I am about to make a job change myself. I am going to venture into the world of self-employment for a few months to see how it goes. If I don’t make enough money on my own, I’ll find another job in the financial services industry. This is a very relevant topic for Ben (Money Smart Life founder) and I. We’re both going through job/career transitions, and we’re dedicated to helping you sort through this complicated time. Here are some things to consider when changing jobs.

Training and Development

Changing jobs or careers sometimes requires additional education and training to perform that new job or career. You may need to add a new license, certification, or degree to be qualified for your new job or career. This can be very expensive, but there is a way to get around it. Ask your new employer if they will pay for it, don’t be bashful to ask your employer to pay for a training and development allowance as long as it’s related to your job function. If you’re going into business for yourself, then there’s not much you can do about this expense, just look at it as an investment in yourself.

Wardrobe

Let’s say you were in the construction business before, and now you’re going to sell insurance. Your wardrobe will drastically change. You’ll need to go out and buy a couple of business suits and business casual attire for the office. This could be a big expense. However, you don’t need to go out and buy the finest clothes to look good. I buy a lot of business clothes at Marshall’s, Kohl’s, and JC Penney for a fraction of the cost.

Commuting Costs

You’ll need to evaluate the cost of commuting to your new job. Is your job farther away from your old one or is it closer to your home? If it’s farther away, partner up with someone to car pool back and forth to work. You won’t know anyone at first, but as you get to know your co-workers, find someone who lives near you. Make sure you like that person, because you don’t want to spend the rest of your time at that job gritting your teeth during every trip back and forth from work.

Difference In Benefits

One of the most important things to consider in terms of expenses are the benefits a company offers. Make sure you measure up the benefits of your old job to the benefits of your new job. For example, what is the comparision between the health insurance premiums or dental insurance costs? Do they have good choics for your 401k and offer a similar match?

The benefits package is very important. You typically gain about $10k to $15k extra from a benefits package. If your new job is weaker on benefits, try to negotiate with them certain aspects of their benfits package. If they really want you to be part of their company, they should have no problem conceding on some of their benefits.

Have you recently made a job or career change? Can you think of any extra expenses to share with everyone else? Comment below with your questions and thoughts.

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Two Weeks Notice – The Art of Quitting Your Job Gracefully

Quitting your job can be quite a liberating experience.  The weight of “all things crappy” in your job is lifted off your shoulders and you feel as though you can finally breath again.  Yet, no matter how bad your job seems at the time you leave, it’s wise to quit your job gracefully and not burn your bridges.

My Two Weeks Notice

After almost nine years of working for the same group, I had a long talk with my boss yesterday where I gave my two weeks notice and let him know I was taking a better job for a lower salary.  Of course I didn’t word it in that way, he asked about the reasons I was leaving and I was honest yet tactful.

The main reason for exiting cordially is that you never know when you’ll need a job or a reference in the future so it’s smart to keep the relationship you built intact.  In my case it was also because I’ve become friends with my boss and many of my co-workers.  However from a purely career-centric point of view, leaving gracefully keeps your professional network intact should you need to call on it sometime down the road.

Here are a few things to consider as you leave your job for greener pastures:

Give Two Weeks Notice

In many companies you’re required to give the official notice and go through an exit interview otherwise you forfeit being paid out accrued benefits such as vacation days.  Some companies have a policy that you can’t be re-hired in the future if you don’t give proper notice before leaving.

Wrap it Up

It’s really tempting to wash your hands of everything you’ve been working on and cruise through the last two weeks but if you dump a load of work on your co-workers or boss that will be the last thing they remember about you.  If you come looking for a job or referral in the future that last bitter memory will likely be the first to pop up.

Transition Responsibility

Let people know where all the bodies are buried.  Train your co-workers on necessary tasks and document important processes.  If you don’t do this you may be getting phone calls and emails for weeks or months after you leave your job.  Plus your co-workers will really appreciate the documentation.

Manage Change

Try and avoid the sinking ship syndrome.  When someone leaves a group, especially if they’re in a leadership or key operational role, the people left behind often ask themselves whether they’ll be the last ones left on a sinking ship. 

• Why are you leaving?
• What will happen once you’re gone?
• Is the group or company in trouble?
• Will they have to work overtime to make up for your absence?
• Should they start looking for a new job as well?

These thoughts will likely go through people’s heads in a time of change but you can help calm their fears by the way you handle your exit.  Announce your departure personally to your core team, the people you work with on a daily basis, so that they hear it from you instead of the rumor mill.  Tactfully explain your reasons for leaving, don’t bad mouth the company or other co-workers.  Be ready to answer questions about transitioning responsibilities and shifting project work. 

Smile On the Way Out

Those poor suckers are still stuck working there and you’re moving on!  So smile and be friendly on the way out the door.  You can’t help but feel bad for your co-workers as you leave for bigger and better things.  If you can quit gracefully and leave as a friend it will be better off for your career in the long run.

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Paying Down Debt In Your Marriage

Debt can be a real strain on any marriage. Today we’ll take a look at how you can work with your spouse to reduce debt together. 

Bringing Debt into a Marriage

In my previous article, I wrote about the excuses that spouses give about having separate bank accounts.  One of those excuses had to do with paying down their spouses debt.  I’ve heard people with my own ears say that they won’t help their spouse pay down the debt they brought into the marriage.  If this is you, then you probably shouldn’t have tied the knot.  Selflessness comes with maturity, and selfless spouses take on the debt of their spouse as a team.  This is a less common situation, but it is out there. 

Debt in Marriage 

The most common situation is married couples that accumulate debt together.  The scenario is quite common.  You get married, buy a house, finance a couple of cars, pay the minimums on your student loans, and slowly accumulate credit card debt.  Before you know it, you’ve racked up $50k in consumer debt, not including your house.  We won’t worry about the house for now, because it’s an appreciating asset and the house acts as collateral to the loan. 

Get Out of Debt Plan

There are dozens of different get-out-debt plans out there, but I am going to share with you the one that my wife and I are currently following to get out of debt.  We hope to be out of debt in two years with this plan.

Step 1: Save $1,500 for a small emergency fund. Dave Ramsey teaches to save $1,000, but I’ve found that $1,000 doesn’t go too far when you have multiple emergencies at the same time. The amount is not the point. The point is that you can’t start aggressively paying off debt until you have a small cushion to help you pay cash when something unexpected comes up. Debt slowly accumulates from the small emergencies in life such as an unexpected medical expense or car repair. Don’t skip step 1! It’s #1 for a reason.

Step 2: List out all of your debts from smallest to largest. If all of your debts are close in amount such as $4,000, $5,000, $6,000, and $7,000, then you should proceeds to Step 2a. If not, then keep your debts listed smallest to largest, and start attacking the smallest debt first. This is helpful, because it builds momentum, cleans up the small debts quickly, and gives you more money to attack the larger debts later on. Only pay the bare minimums on the debts that you aren’t focusing on.

Step 2a: If your debts are of similar amounts, then list them from highest interest rate to the lowest interest rate. Attack the debt with the highest rate first. Then, work your way down the list and pay the lowest interest rate last, because it’s hurting you the least.

Step 3: Find creative ways to boost your income. This is important, because many of you with a lot of debt don’t have much extra money to put towards paying off debt. Find temporary, creative ways to boost your household income to pay off the debt as quickly as possible. Here are some quick ideas to boost your income.

• Have a Garage Sale
• Take a part-time job such as a driver for UPS, delivering pizzas, waiting tables, or baby-sitting.
• Start your own side business (fixing computers, consulting, professional organizing, landscaping, and making/selling crafts)
• Sell odds and ends on Craigslist and eBay
• Sell your blood Plasma. Don’t do this too much, you’ll look like a heroin addict.
• Participate on a medical research study. Yeah, I know, you don’t want to be a guinea pig, but I participated in three different studies and made over $1,500 when I was in college. I still have all of my arms and legs.

Step 4: Once you’ve paid off your last debt, go celebrate! You did it! Then, start building an emergency fund that will cover four to six months of expenses. Doing this helps you make sure that you’ll never get into debt again.

This method only helps you clean up your credit card, car loan, student loan, and other personal debt. Don’t include your mortgage as part of your list of debts unless it is a second mortgage. If you have a second mortgage, include it as part of your list, but save it for last. This step-by-step method only works if you are living on a strict budget, and you must have the dedication and perseverance to make it happen. If you have any questions, feel free to contact us.

For help managing your money as a couple check out the marriage budgeting tips. One sad, but necessary, thing to think about is how you’d pay off your debt if you suddenly lost you spouse, read more about buying life insurance to help protect your family.

These tips for reducing debt in marriage are part of the Marriage Money Guide.

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Car Repair and Cashback Cards – Big Spender Edition

“Hey man, just put it on your credit card…”  That’s the best answer the Honda service manager could give me as I attempted to negotiate with him to cover the repair costs for the air conditioner compressor failure on our Honda CRV.

Honda had offered to cover the costs of the parts but wouldn’t budge on helping with the repairs.  The service manager couldn’t understand why I wasn’t ecstatic that Honda was covering the cost of the parts. He just kept saying

“All you have to pay is the repairs, that’s a great deal!”

Sure, I was glad they were paying for the replacement parts but I told him that the $600 repair was still a lot of money.  That’s when he told me to just put it on my credit card. 

“Don’t you have a cash back card? Just charge it on there.”

I was pretty steamed; I wasn’t looking for advice on how to pay for the repairs, I wanted Honda to cover the costs.  I had talked at length with both Honda America and the dealer but neither one would do more than pay for the replacement parts. 

Paying for Car Repairs

Unfortunately, I was between a rock and a hard place.  We needed the car to get to work and didn’t have any more time to mess around with getting it repaired so I agreed to pay for the work. Of course, I did end up paying for the car repairs with my American Express Blue Cash and earned a little cash back on the purchase but that didn’t make the expensive bill easy to pay.

To top it off, our Accord has about 125K miles on it and I had the car to take it in for some maintenance.  After paying for the air conditioner repairs on the CRV and some work on the Accord it was certainly a big spender weekend.   The good news is we have money in our car fund to cover the costs. I paid for the repairs up front on the credit card and I’ll transfer over some money when the bills due.  The bad news is that our car fund is smaller than it used to be : (

Money Articles

Speaking of car repair, Get Rich Slowly has a write-up on quick and easy car maintenance.  I don’t think maintenance would have helped with our defective part but it can certainly help prevent other expensive car problems.  Here are some of the other posts I enjoyed this week:

– Brip Blap suggests that if you hate every job you have, the problem might be you, not the job.

– Lazy Man and Money has a guest post on Easy and Cheap Home Remodels.

– My Dollar Plan take a look at tracking your Roth IRA Contributions. 

– Sun’s Financial Diary talks about investing in commodities, here’s some more info about investing in commodity ETF’s.

– Frugal Dad has a guest post on 10 free dates your wife will love. I object to “go house shopping”, that could turn out to be a VERY expensive date in the long run.

– Million Dollar Journey gives us a look into a millionaire’s investment accounts.

– Generation X Finance has tips on how you can raise the value of your home with a little lawn care.

– The Digerati Life warns about the risks of buying penny stocks.

Money Blog Network

I can’t believe how small the cereal boxes are getting at the store these days, yet they cost the same. All Financial Matters lets us know portion shifting is now happening with beer as well.

– Five Cent Nickel reminds us of the continued Fannie Mae and Freddie Mac fallout from the credit crunch.

– No Credit Needed has an inspirational post, You. Can.  One of the reasons I think people end up failing is because they make too many excuses.  That’s why I started the no more excuses topic.

– Mighty Bargain Hunter offers up a few deals like a 50% coupon on Restaraunt.com for Grandparents Day!

– Free Money Finance suggests that Social Security isn’t the issue and recommends we save a ton of money for health care in retirement.

– Consumerism Commentary tells us how we can earn cashback at Costco, here’s some additional information on saving money on gas at Costco with the American Express True Earnings card.

Saving Money on Gas

– Blueprint for Financial Prosperity looks at some gadgets you can use to monitor your car’s fuel efficiency.

– Wesabe announces a new service named Fuelly that lets you track gas usage.

– For more on gas savings, check out the gas credit card survey, read how your boss can save you money on gas, follow these easy gas saving tips, and read the review of the best gas credit cards.

Money in Marriage

In case you hadn’t noticed, we’ve been running a series of posts on money and marriage and recently wrote about joint checking accounts in marriage so I took note when I read Trent of the Simple Dollar decided to merge bank accounts with his wife. Trent has a good piece of advice to share on the topic:

Communicate with your partner about money from the beginning, and don’t leave anything hidden when you talk about it.

Personal Finance Highlights

Thanks to the following sites for hosting the carnival of personal finance and including our articles for the last several weeks:

• One Caveman
• Broke Grad Student
• No Debt Plan

Hope you all had a nice weekend!

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Do Married Couples Need to Buy Life Insurance?

Death. No one wants to think about, especially a newly married couple. However, thinking about the worse case scenario is an essential trait for maintaining a sound financial plan. There’s no scenario worse than the death of you or your spouse, and that is why you need to prepare for it.

When Should You Buy Life Insurance?

Here are some scenarios where you might want to protect your family with life insurance:

• If you buy a house together as a couple, buy life insurance. If one of you dies, then the other can take the death benefit and either pay off the house or invest it and pay the payment with the monthly interest that it earns.
• When you have kids. If you both die together in a car accident, you need to leave money behind for your children to live a happy and fulfilling life.
• When one spouse is a stay-at-home parent. If the primary income earner dies, the other spouse MUST be left with a death benefit to cover monthly expenses.

What Type of Life Insurance Should You Buy?

For a younger couple in these situations I would recommend level term life insurance. I think cash value life insurance such as whole life, variable life, and universal life insurance are horrible products for the consumer.  They attach a cash value account with a death benefit.  The problem with these products is that the investment accounts attached to these policies typically yield low returns and come with VERY high management fees. 

Honestly, these products only make life insurance agents richer, not you.  This is why many financial advisors and life insurance agents recommend these products, because they offer a higher commission than term life products.  Term life insurance is only a death benefit of a specified amount for a level amount of time, and the premium is VERY cheap for healthy individuals. 

For instance, I just looked on Zander Insurance for an instant term life quote, and I can purchase a 20 year policy for $750,000 for $342 bucks a year!  Don’t use a life insurance policy for your retirement investing.  Designate mutual funds, index funds, and real estate for your retirement nest egg.

How Much Should You Buy?

Buy 8 to 10 times of your yearly income. So, if you make $50k a year, then you should buy $400k to $500k in term insurance. The idea here is that your spouse could take that money, invest it in good mutual or index funds, and replace your monthly income with the monthly interest from the lump sum death benefit.

Where Should You Buy It?

You could try and inquire separately with companies like Met Life or Zander Insurance or you could check with your local insurance agent or financial advisor that you trust. Another option is to check online with an established company for life insurance quotes.

I told you this would be a topic that you didn’t want to read about! It’s okay. The only things certain in life are death and taxes. Face reality and prepare for the worst. You owe it to your family.

If you think your family needs a life insurance policy and are looking for ways to pay for it check out the marriage budgeting tips and coverage of joint bank accounts for married couples to help make a plan and work together towards it. 

This coverage of buying life insurance in marriage is part of the Marriage Money Guide.

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Joint Checking Accounts for Married Couples: The Great Debate Over Joint vs. Separate Bank Accounts

Whether you are newly married or you’ve been married for 20 years, the debate over joint versus separate bank accounts is a hot topic among married couples. Some couples swear by separate bank accounts, and other couples think joint accounts are the only way to go. I’ll give you my opinion over the debate, the best checking accounts for married couples, and a strategy for making the joint checking account work.

Joint vs. Separate Accounts

I have a strong opinion about this debate. I think that all married couples, new and old, should hold joint checking and savings accounts. I understand the argument for separate accounts, but when you said “I do” at the altar, you made a commitment to become one cohesive unit. You are a team, and you need to act like one. When you choose not to share your finances, you are choosing not to share one of the most important aspects of your lives. You can give me all of the excuses about how it works better with separate accounts, and it’s too confusing to share money. The reality is that you don’t trust each other, and you won’t put the time into sharing your money. Don’t settle for the compromise of spending whatever you make. Your marriage is not a business partnership, and if you weren’t ready to give up control of your money, then you weren’t ready to get married.

Responses To Advocates Of Separate Bank Accounts

“She/He spends too much money, and he/she won’t listen to me when it comes to saving money” The answer to this problem is communication and/or marriage counseling, not separate bank accounts. If your spouse refuses to change their financial habits and they are reckless with money, then you don’t have a financial problem. You have a marriage problem. You need to find common ground as a married couple, and help each other rather than get mad at each other. If you can’t communicate and resolve the problem on your own, see a marriage counselor. There may be a bigger issue that one of you isn’t talking about.

“It’s too confusing to share money. I’m afraid that we’ll overdraft on our account.” This is the excuse of a lazy couple that doesn’t want to communicate and budget money together. The solution to this problem is getting on a budget, and planning how you will spend your money each month. Set aside two hours each month to go over your budget and finances for the month with your spouse.

“She/He brought more debt into the marriage. She/He should pay it off on his/her own.” I’ve actually heard people say this before, and it makes me cringe every time I hear it. When you get married, you are coming together become one person, one flesh. You work as a team, and you help each other no matter what. If your spouse is bringing in a bunch of debt to the marriage, it’s now your debt. I don’t care who’s name is on the debt. You have an obligation as a marriage partner to share that debt.

Strategies for Sharing Bank Accounts

Our Strategy: I married a girl who is more frugal than me. In fact, she makes fun of me for the gadget cravings that I get and my weakness for spending money when we go out at night on a date. I got lucky. I never worry about her going on a spending spree with our money. She follows our budget religiously. There was no question when we got married that we would share a checking and savings account. We have a Bank of America checking account for convenience, and we have an ING savings account for short-term savings. I have a 401k for retirement, and now that she’s working, we’re going to open up Roth IRA’s with Sharebuilder in the coming months. We’ve shared a checking account for three years, and it’s been a great decision. We sit down every two weeks to go over our finances and map out what we’re going to do with OUR money, even though I was the only income producer for the past three years.

Joint Checking Account with Two Separate Checking Accounts: If you simply can’t grasp the concept of having one joint checking account, then try this method. Keep a joint account that feeds all of your income into it, and pay all of your bills through this account. Keep a separate checking account for yourself and for your spouse. Divide up 5 to 10% of your income into the separate accounts. Make a pact that you can do whatever you want with that money and your spouse can’t question you about it (as long as its legal! haha). My wife and I do something similar with cash. We give each other a certain amount of money each month called “mad money”, but instead of putting it in separate accounts, we keep it as cash. I like having some cash on me at all times, because there are still situations in life where you can’t swipe a piece of plastic, and sometimes cash speaks louder than plastic.

Checking Accounts of Interest for Married Couples

• FNBO Direct
• Sun Trust Bank Checking
• Wachovia Checking
• Charles Schwab Checking

I know that i made some bold statements in this article, but I will stand by them. It was not my intention to offend you, but I hope it gets you thinking about your current financial set-up with your spouse. I am sure there are people out there that have separate checking accounts with a healthy marriage, but it is the minority. Think of this is a challenge to get you to think differently, not an attack on your current opinions. You must be on the same page with your finances, and sharing every aspect of it is part of the foundation of a healthy marriage.

For more money tips for couples you can read about budgeting money for newlyweds, tips for finding an apartment after marriage, and a couples guide to buying an affordable house.

This article on joint bank accounts in marriage is part of the Marriage Money Guide.

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