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Joint bank accounts might be the spice of (married) life. According to the authors of a new research paper published earlier this year, couples who want their honeymoon to last longer might want to merge all of their bank accounts into joint accounts.

Relationship quality has been found to peak right around the wedding day, followed by a sharp decline over the next two years. We may colloquially know this as the “honeymoon phase,” but researchers have coined it the “connubial crucible” and the dynamics of a relationship during this period are fairly good predictors of long-term happiness and rates of marital breakdown.

Couples who were told to merge their bank accounts into joint accounts were able to avoid the decline in relationship quality during the two years after their wedding. Conversely, couples who were instructed to keep their bank accounts separate and couples who were given no instructions at all both exhibited the standard decline in relationship quality. (A substantial 72 per cent of couples given no instructions self-selected into separate accounts, and of the 28 per cent who chose joint accounts, most set up those accounts after the one-year mark in the two-year study.)

What is particularly striking about this research is that it is the first paper to draw a causal link between how couples set up their bank accounts and the impacts on the quality of the relationship. Prior research had already found that couples who kept separate bank accounts experienced lower relationship satisfaction and were more likely to break up than joint-account holders, but those papers showed correlation, not causation.

That distinction is very important. For example, while ice cream sales and shark attacks might both peak in the summer (correlation), buying ice cream does not cause more shark attacks to occur, nor do shark attacks cause people to buy more ice cream (causation).

The jury was previously out on whether joining bank accounts leads to higher relationship quality, or if people in better relationships are more likely to set up joint accounts. This paper shows that, on average, combining bank accounts leads to better relationships.

So what is it about joint bank accounts that can change the dynamics of a relationship? The researchers propose three potential mechanisms: improved feelings about money management, financial goal alignment and sustained adherence to communal norms.

Couples in communal-oriented relationships tend to provide support to one another because a partner needs support, while exchange-related relationships are characterized by providing support as a means of prepaying for future favours. The former is associated with better long-term relationships and a sense of shared responsibility and mutual support, encouraging a mindset of “we” rather than “me.”

However, while the decision to merge finances can have positive implications, it’s crucial to remember that every situation is unique. On average, merging bank accounts had a positive effect on relationship quality, but the authors caution that this doesn’t mean everyone should rush to completely merge their finances. In some cases, maintaining separate accounts can serve as a form of financial protection.

The paper’s lead author, Dr. Jenny Olson, notes, “We fully acknowledge that joint accounts may not be ideal for all couples. For example, partners entering second marriages, those with children from previous relationships, older couples – essentially, those with relatively more complex financial histories than first-time newlyweds.”

Alyssa Davies, author of the book Financial First Aid, adds that the entire goal of having a healthy relationship is to find ways to work as a partnership or a team. But there can be many valid reasons to have some degree of separate banking arrangements, and only using joint accounts can be risky.

“You are putting yourself at risk if something happens and you and your partner split up. It’s perfectly okay to protect your future or past self – if you’ve experienced something traumatic or like to have a sense of security in controlling your finances, that’s okay. And having a partner who gives you the space and understanding to work through this sort of financial trauma is important,” says Ms. Davies.

She suggests a partial combining of bank accounts can make a lot of sense for some couples. “You can share accounts and credit cards and still give yourself access to your own money, whether it be a personal emergency fund, or you each give yourself an equitable portion of your earnings as free spend money,” says Ms. Davies.

Preet Banerjee is a consultant to the wealth management industry with a focus on commercial applications of behavioural finance research.

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