For the hubby and I, our money has always been separate. We each have our own separate bank accounts and we each have small emergency funds (around $1000 each) as well as another account where the bulk of our savings goes which we use for travel and larger purchases.
I have seen it happen far too often where life is going along swimmingly and suddenly one spouse is blindsided by the other and then not only is that person tossed into the throes of crisis, but they are often left without money to boot. This happened to one friend when out of the the blue her husband called and said he was moving out and they would be getting a divorce. I mean, they had been married for almost 25 years and she had no clue that he was even thinking of such a thing. Another friend had been married for many years and everything was going well, she and her husband even had a cruise booked, and then he died suddenly. Yet another friend had been living with a guy for nearly a year, he was even paying most of the household bills, and then one day he called her from jail saying he had been arrested for outstanding warrants he had from another state. There went her boyfriend AND the income he was providing towards their household expenses. Those are all horrible scenarios yet they happen in real life all the time.
Mostly it seems like these things happen to women, but they can happen to men as well so everyone needs to keep their own private stash of cash to use in an emergency. When you are in the middle of an immediate crisis that you had no idea was about to happen, the last thing you want to do is to have to scrounge under the couch cushions to try to gather enough money to feed your kids that evening.
Here's some guidelines:
- I don't think your personal emergency fund should be a secret from your SO. In fact you should encourage them to put together their own personal emergency fund as well. Hopefully you will never have to use it because your SO called to say they want a divorce or their girlfriend just showed up on your door step, but there are many other life-altering events that could happen such as your SO suddenly dying or being in a major car wreck which leaves them in the ICU for days or weeks on end. By having your own emergency fund and knowing that your SO has theirs, both of you will still have the money to function in the midst of a crisis.
- I don't think your SO should be able to access these funds and vice versa. Too many times, whether because of greed or just because one partner was pissed off, I have seen people who thought they had an emergency fund go to the bank and find out that their SO had cleaned out their entire account and left them penniless. Obviously, in the event of one spouse's death, the other spouse would be able to access these funds eventually but while you are both alive and kicking, the money in your private emergency fund should be all yours so that you can rely on it being there in an emergency.
- I don't think the fund should be huge. One or two thousand dollars in each person's fund should be fine. Ideally you would only need to use these funds for the first week or so of a major crisis at which point you will have had time to come to some sort of terms with your SO or have the power of attorney invoked so that you will be able to access/use your joint funds. I think that if one spouse feels that they need $10,000 in their own fund, then there are probably some pretty big issues in the marriage and maybe that money should go for a marriage counselor or something.