Dear Christine,
I have a high-yield savings account and the interest keeps rising, which is fantastic. Inflation is high and the market is crazy, so I love knowing that my money is growing somewhere. I keep telling my husband to give me the money in his account so I can put it in mine, and then we’ll earn more interest! But he is hesitant. How can I convince him?
Best regards,
Everything about APY
Inflation and Potential Risks
You are absolutely right that in this high inflation environment, you should take every opportunity to ensure that your money is not losing value. You didn’t tell me how much interest you are earning on your savings account, but since most high-yield savings accounts pay interest rates around 1.75%, it is likely much higher than what he (or you) is earning in your regular bank account, where you can only earn an average of 0.13%.
So I understand your point of view; if he could earn more money in your savings account – why wouldn’t he do that? But just like with our hearts, when it comes to our wallets, things are rarely that simple.
The reason he may be hesitant to combine his savings with yours may have nothing to do with the fact that he is losing money by not doing so. There may be other emotional reasons for his hesitation.
Potential Risks of Combining Resources
Combining resources – even in the case of marriage – is not without risks. Personally, I believe that all married couples should keep some of their savings separate, whether for personal spending on gifts, or going out with friends. Since you’re married, separate accounts can be considered joint property in the eyes of the law in many states. Joint property is typically divided equally between spouses after divorce.
However, if the account you want to transfer his money into is solely in your name, then that money will be yours for all practical purposes. And while I don’t mean to imply that he believes you’ll try to take his money and run, there may be some general anxiety about handing over all of his money (and, to some extent, financial control) to you, especially if there is relative financial independence between the two of you.
So talk to him about this, and kindly ask him about his concerns. Is he worried that if you combine your savings, you’ll spend “his money”? Does he feel strange about dumping his bank account into a single account in your name only? Does he have other concerns about putting his assets in your name? This is a great opportunity to talk more about money and his feelings and approach to money. If your financial goals are to increase your savings, it would be good for you both to be on the same page and work together on the best way to get there.
Potential Alternatives
But honestly, if your goal is just to maximize his savings, he doesn’t have to put his money in your account. You can suggest that he open his own high-yield savings account. With the interest rates that the Federal Reserve is implementing (and expected to continue doing so), it’s even possible he might find an account that pays interest rates of up to 2% or higher. This could be a win-win opportunity for both of you: his money earns more due to the higher savings rate and remains entirely under his control.
And if he doesn’t want to put his money in a savings account at all, there is, of course, the option to put the money into something like a certificate of deposit, which will tie up his money for a set period but may offer better returns even than what you might see in a high-yield savings account.
Communication
The main point here is for both of you to determine the best way to increase your savings and for any other financial issues you may face in the future.
Good luck!
– Christine
If you have questions about money, Christine is here to help. Submit an anonymous question and she may answer it in a future article.
Resources
At The Balance, we use only high-quality sources, including peer-reviewed studies, to support the facts in our articles. Read our editorial process to learn more about how we fact-check and maintain the accuracy, reliability, and quality of our content.
FDIC. “Bankers Resource Center – National Rates and Rate Caps.”
Sallie Mae. “High-Yield Savings Account.”
California Courts Self-Help Guide. “Property and Debts in a Divorce.”
Source: https://www.thebalancemoney.com/i-want-to-combine-our-savings-why-doesn-t-my-husband-6544925
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