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Separate Bank Accounts – Tip

Markus Schmucki 0

First read you probably are thinking I am advocating that you should have a separate bank account from your spouse. Nope. I actually believe that if you trust your spouse, you should have a shared bank account and treat all funds as shared funds with some caveats.

Yet this is not what I am speaking of. So if you own a business, you should and in some business types are required to keep your personal banking from your business banking. That is easy to do. That is still not what we are talking about in this scenario.

Imagine you have engaged in automatic bill payments from your lender of choice. You send out bill pay payments or perhaps you setup direct payment from each of the merchants that you owe money to. You need a separate checking account. Did you know that your checking account is very susceptible to being over leveraged by an ACH wire transfer, or billing payment mistake. I recommend you do as follows:

Use your personal primary checking account for the purpose of writing physical personal checks, leveraging online bill pay solely and have your spouse use it for check writing exclusively. Both of your names are on it, so technically you could also write checks and do banking with it. Do not link ANYTHING withdrawal wise outside to this account. You will want to have direct deposit from your employer or other funds inbound deposited to this primary checking account. So what you end up with with primary is a deposit record, and check withdrawals by your spouse, bill pay payments with full tracking by the bank you use, and a history of any transfers you do internally between savings and checking accounts. No surprises and only 1 person to contact if a check is odd — your spouse.

Next — setup a secondary checking account for the purpose of YOU writing any personal physical checks. Put both your names on it is fine. In this case you will configure deposits by ways of internal transfers from primary checking or savings to cover what you need to cover. Next, direct any automatic withdrawals. insurance premiums, credit card payments, mortgage payments from this secondary checking account. Do not use bill pay on this account. It is critical you keep just enough funds in it each month to cover your bills. This way, if someone were to over-draft by ACH or wire out more than what is needed, you will not be drained given the separate account you have for primary checking. Use free up to X scheduled transfers on the online banking portal to cover automatic each month monies from primary or savings to secondary and you will see a tight account to react to automatic payments you have configured.

What you are left with is a 2 checking personal account system that helps you keep track of the actions of you and your spouse without wondering if it was you or them and having some controls in place as to how many outbound payments there are all in 1 account. Most credit unions can offer multiple non-fee bearing checking accounts to achieve this purpose.  Now with mobile deposit, it is even easier to access these accounts without having to remember all of the digits.

Separate accounts while both having access to it but using it separately for different inbound/outbound purposes to highlight anything suspicious and reduce stress in wondering what is going on.