When should you merge finances with your partner?

After two-and-a-half years of dating, 29-year-old Mike Moore and his girlfriend decided to move in together. And with that exciting decision came the inevitable discussion of how the Toronto couple would handle their soon-to-be shared expenses.

Rather than risk a situation where one of them ends up paying for more than their share, the couple decided that the most logical course of action would be to open a joint account.

“Everything that’s a shared expense gets pulled out of there,” says Moore.

According to a 2014 TD Bank survey, millennials are more likely than older couples to merge finances before getting married. In Moore’s case, he and his girlfriend didn’t actually combine everything. Instead, they opted to maintain their own individual accounts and just open an additional joint one — something 42% of those in relationships have also done. “That little bit of independence is nice,” says Moore.

Is it ever too early, though, to join accounts? Or might millennials like Moore be onto something?

Before jumping headfirst into a financial union, there’s a lot to consider. First, there should be some shared expenses in the picture. For Moore and his girlfriend, that includes things like groceries, hydro and internet. To cover these costs, the two equally contribute to their joint account and dip into it whenever necessary.

“We find it’s a lot less hassle than remembering to pass money back and forth,” he says.

But just because two people have hit it off and gotten together doesn’t mean their bank accounts should, too.

“Those who don’t want to get married right away, if ever, tend to start thinking about joining accounts when they buy a house or move in together,” says Marty Denomme, a financial advisor in London, Ont. “And because they’re sharing expenses, it makes sense to have that account to pay for the joint bills. But you need to be conservative about it, too.”

It’s crucial, says Denomme, to first gain some insight into your partner’s financial situation.

“You don’t need to know exactly how much money they have in the bank,” he says. “You actually need to know the opposite.”

That means talking about how much debt they’re carrying, or whether they have multiple credit cards that are maxed out.

“You need to have these kinds of conversations,” says Denomme, “so you know what you’re getting yourself into.”

Why? Because if you end up marrying that person and open a joint account or apply for joint credit, that whole “what’s mine is yours” sentiment quickly goes from just a sweet gesture to legally binding. Even if your spouse racks up debt alone, as their husband or wife, you’re now liable for it, too.

That’s an idea that, at 27 years old, still freaks me out. I’ve lived with my boyfriend for almost two years now, and while we have shared expenses, I still earn significantly less than him. The thought of him having regular access to my minimal funds feels wildly unfair. And why should I get access to his hard-earned dollars? My reservations have nothing to do with trust — I just think my money should be mine and his money should be his. And the same goes for our debts.

I can see the merit, however, in one day opening a shared savings account, even before marriage, that we both contribute to for things that we’ll both benefit from, like a vacation or a house. 

The thing is, it doesn’t really matter when you decide to merge finances: before marriage, after marriage, or, never. There's never really a "too soon" if it works for you. What’s most important is the communication that takes place before you do.

“When you join accounts,” says Denomme, “you have to think beyond just your narrow mindset of individuality. Too often, people sweep the important conversations under the rug, which can be a big mistake.”