10/23/2009

Joint Bank Accounts

Jordan and I have taken the next step towards joining our finances and our budgets.We have been talking for a quite a while about this possibility, and I've written about it before as well.

Our joint account is going to be, strictly, a bill paying account.  We will pay our rent and our three household bills from this account (shaw, bell and enmax).  This is going to achieve a couple of things for us.
  1. It will create some stability in our accounts.  We are going to come up with a bi-weekly amount to contribute to this account that will cover rent & utilities.  Our roommates money for rent/bills will also be deposited directly into this account.
  2. It will create a stronger financial unity between us.  I have been managing all of the household bills for the last 3+ years, making this changes allows Jordan and I to do this together.
  3. Through contributing bi-weekly (rather the monthly) we will develop, in short order, a buffer in this account, or a joint emergency fund if you will.
I'll explain the third point in more detail.

Assuming our rent stays consistent at $500/each, and approximating utilities at $150/each (for 3 people) we come up with a monthly amount of $650. Dividing that amount by two gives us $325/bi-weekly.

Jordan and I are paid on opposite weeks.  That means that there are four months out of the year that have an 'extra' pay cheque.  So, within a years time we will have accumulated $1,300 ($325*4).  I think that's a pretty crafty way to build a joint emergency fund.  Once we hit the $1,000 mark in that account the 'account fees' will be waived, so there's another bonus to leaving the money in that no-interest baring account.
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5 comments:

  1. That sounds very well thought out. It will level your cash flow, and you won't have that up and down in your available funds. You will progress to your goals more smoothly.

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  2. What a great plan! I can't wait until The Boyfriend and I are both finished school (this spring, baby :D) so we can sit down and work out a plan that unites our finances a little bit.

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  3. thats a good idea. it should simplify the household money and you will know exactly what is household and what you are free to spend.

    regards,

    Jason

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  4. Such a good idea! I like the fact that you also have your personal accounts for now as well. I would like to do that with my boyfriend after we move in.

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  5. Sounds clever to me - congrats on starting up the joint account! It's great that you guys get paid on opposite weeks too. I remember balancing two PT jobs, which both paid fortnightly and on the same cycle. It meant I got big paychecks every two weeks but that made it a little hard to manage as all my bills and payments are set up weekly... but it was good discipline!

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