Opening a Savings Account with a Boyfriend or Girlfriend

By Michael Cadet

When considering opening a joint savings account with your girlfriend or boyfriend your best ally is common sense. You don’t want to put yourself into a situation you will possibly regret. This can be a great experience if you properly assess every angle.

The first question I would ask myself, is this the right person to open an account with?  Consider the amount of time you have been with this person. Do they show signs of mental stability? You may chuckle at the question, but seriously, do you want to tie your money up with someone who is Happy Harry on Monday then Wallowing Willy on Wednesday? I think not. If your relationship is already on shaky grounds then opening an account and combining your hard-earned assets may not be the best idea.

So let’s assume you are in a serious and stable relationship and you’re ready for the next step – which doesn’t have to mean marriage or even living together. Talk about what you each want in the future. After eliminating the new pink puppy and the new Harley, clearly define what goals the two of you have in common. If a new Harley is what you desire – more power to you.  But we’ll talk about buying toys at a later date. Just for the sake of this post let’s assume you both want to save for a down payment on a new house.

Now that you’ve both decided to save for a down payment on a home, determine how much it will cost. Once you have a realistic goal in mind, determine how much you both currently have to kick-start your savings. This will indicate how much more you need to save. Next, determine how much you both make. Now, this is important. When introducing a new goal into your budget make sure it doesn’t negatively impact your current monthly obligations. If after calculating your budget you find that you don’t have enough money for the laundry mat you can do 1 of 2 things. 1. Get a second job. Late night stocking shift at a grocery store works. Or 2. Realize your goals aren’t realistic at the moment and set a more attainable goal.

Selecting the right bank deserves some serious thought as well. There are two distinct types of banks you should be able to recognize: National/Regional banks and Local Community banks. Read more on the differences here.

The most important suggestion I will make is to open your account as a Joint “AND” account. This titling requires that both account holders be present when performing a transaction on the account. Pretty much the only thing you can do without the presence of the other account holder is put money in. This will eliminate any fear that if things turn south your significant other will run off with all your money.

A warning before you sign on the dotted line: consider the possibility that things may not work out. In that instance, the best thing to do is to collect and divide what you’ve contributed and move on with dignity. Regardless of how things end up in your relationship you will have a positive financial outcome. If things turn out for the worse, consider the return of your contributions as a severance package. A little money may help ease a broken heart.

Til next time, make your next move your best move!


National Banks vs. Community banks

By Michael Cadet

There are two distinct types of banks you should be able to recognize. You have National/Regional banks and you have local community banks.

National/Regional banks offer much more convenience. They typically offer many locations throughout the country and in some cases internationally. This makes it easier to handle transactions when traveling outside your usual proximity. In most cases they offer longer business hours and 24hr customer service operations. National/Regional banks have greater resources and more lending capabilities than smaller local banks, which is extremely beneficial for a person or business with larger lending needs.

I’ve heard, unfortunately, customers complain that larger banks don’t offer as personable service as smaller banks do, and are less flexible with their policies and procedures. Negotiations can also be more difficult when it comes to loan conditions.

The main appeal of community banks is their personable service. This is primarily due to the fact that they’re not publicly traded, meaning these banks don’t have to report their numbers to Wall Street executives. Wall Street is only concerned with one thing – making a profit. The absence of Wall Street pressure makes it possible for smaller local banks to focus more on serving their community. They’re also generally more flexible with policies and procedures.

The only draw back to smaller community banks is the inconvenience of having limited locations. Also, smaller banks may not have the resources to accommodate larger lending needs.

Everyone has different needs depending on circumstance and personal preference, so it’s important to familiarize yourself with the characteristics of the bank that will be serving you.

As always, make the next move the best move!