Sharing money works for our marriage
David at My Two Dollars seems to have a very similar marriage, at least with regards to finance, as we do. He wrote a short article about how sharing finances when they got married worked for them.
Way back when I first start this site, I wrote an article about keeping Joint vs Separate Checking Accounts. I still stand by my argument that keeping separate accounts is selfish and reflects and breeds distrust in your relationship.
My wife and I had all of our serious money arguments before we got married, and really the only arguments after the wedding revolved around my problem with wanting new cars. It’s really just a spring fever type thing, and I still haven’t gotten over it, but we’re at least analyzing our car options before doing anything now.
Back to sharing bank accounts, I really don’t see any reason to have separate accounts except for personal vs business accounts. We set a rule that any expenditure over $50 (give or take) must be approved, and that prevents both arguments as well as larger impulse purchases.
I think, overall, this works for us because of the following:
1. We trust each other
2. My wife doesn’t have time to manage the checkbook (which can cause a problem in the future if something happens to me)
3. We don’t really care about keeping up appearances of being wealthy.
Let me explain #3. My wife doesn’t wear make-up and uses very little hair stuff, but she’s beautiful anyway. I keep my hair cut short (or else I’d look like a clown), and don’t need to “dress for success”. Neither of us are sloppy, but we just don’t need high-priced clothing or anything fancy. Consider us frugal (not cheap).
Outside of paying off debt, buying a new shirt, pants, or skirt (obviously not for me) every few months, and dining out, we really don’t spend much money. We take trips and vacations every so often, like a marriage conference in 2 weeks (which I HIGHLY recommend attending from past experience). We splurge on a car rental so we can change up our routine on longer trips. But again, we just don’t spend much money.
Obviously, my blunt opinion above will provoke some anger among some of you, and that’s fine. However, think through your response before posting. I really am open to listening to and understanding your reasonings against (or for) joint finances, but please, please, don’t just rant.
So, let me know what you think, and prove me wrong that you can have separate accounts and still completely trust your partner. By “trust”, I mean if you two decided tomorrow to merge all your money, that you would be totally content with the idea and assured your spouse would spend the same amount after the merge as he or she did before.
I completely agree with you. As a family with limited income and kids, we don’t have the luxury of NOT merging our accounts. It would just be an extra hassle.
Of course, my husband doesn’t like my occasional guilt trips about card charges at Starbucks, but we are both accountable to each other for purchases as we climb out of debt and build our family.
I wouldn’t want it any other way.
My wife and I also share an account. I did open a separate account recently, strictly for online business things (buying & selling websites, advertising, hosting fees, etc.). I am definitely for the joint account, but I feel my small separate business account will not hurt anything.
Some people feel safer with not sharing an account with their spouse. If they feel that way then there is no trust in the relationship. This is just my personal thoughts.
What is more likely is that if you had separate accounts it would breed distrust in your marriage because thats what you believe to be true.
I could just as easily say not trusting your wife to have her own account breeds distrust in your marriage. If you believed that, it would also be a self-fulfilling prophecy.
Every one should do what works for them, and if it isn’t working they should try to change it without prejudice. There are probably as many ways of managing money in a relationship as there are relationships.
@Plonkee – Obviously, every couple does it their own way, and at least 50% do it the wrong way (whatever that way is) and it leads to divorce.
However, I do like your other way of looking at it. By NOT having separate accounts, that could breed distrust.
You can look at it as 2 types of separate accounts then:
1) All money goes into a joint account and gets auto transfered in a specific amount to the individual accounts or
2) Each person’s paycheck (assuming they both work) gets direct deposited into their own accounts. It’s truly separated money.
I think #1 is ok, but you could do that budgeting for personal money in your head and on a spreadsheet. Having more accounts is just a pain to manage. #2 is where the problem lies. They each consider it “their money” and “their bills” and “their stuff”.
Once you’re married it’s “our stuff, money and bills” unless you don’t plan on sticking to the marriage very long and you’re already planning your escape.
Thanks for the mention Clever Dude..I could not agree more. If you are doing “mine” and “yours” after marriage, you are in trouble already…
My wife and I have three joint accounts. One account gets all our paychecks and income direct deposited. That account has sub-accounts in it, so it makes it very easy for us to budget because it automatically moves $X to subaccount 1, $X to subaccount 2, etc., and we then have subaccounts for groceries, gas, bills, mortgage, insurance, etc. each with their own amount in them. At the end of each month, we can see how much over/under we are in each account as we go through the credit card (we charge everything to get cash back) and move money from each appropriate subaccount into our credit card payment subaccount. Anytime we realize we’re consistently over or under in a particular subaccount, we adjust both our budget and the auto-transfer amount to compensate if we think it’s necessary.
The other two accounts are joint only so that if something happens to one of us, the money is still under the control of the other person. However, those are only used individually. We each get $25 a week auto-moved from our main account into each of our “individual” accounts. This is our spending money, or allowance, and we’re not responsible to the other person for how we spend it, its our individual money. I happen to spend mine on going to the bar with my buddies, or buying comic books or games; she spends hers on movies and eating out with her friends, and sometimes buying stuff for her garden or clothes.
At the moment, I’ve got maybe $150 saved in my account, because I want to buy a nice new video card for my computer.
This works for us; we share all our finances, but we each get an allowance basically that is in its own account with its own debit card, that we can spend on whatever we want without needing to ask the other person, because that allowance for each of us is built into the budget and automatically transferred every Friday. The rest of our money is 100% each of ours, and we decide together what to do with it, how to budget it, when to spend it and what to spend it on, how to do savings, what to invest in, etc.
We’ve only been married a year (yesterday was our first anniversary actually), but we discussed how we were going to do things before we got married, and implemented all the changes to our finances within the first month of being married. Incidentally, my wife is a loan officer at a credit union, so she knows a lot about credit and loans and interest and making money, and she’s a real whiz at it, and I’m not, so I let her do most of the work because she enjoys it and looks at all of our accounts probably once a day on average, so I’m very blessed to be in that kind of situation.
Here’s something I learned from her last week that I had never heard before: your credit score drops if you have more than 50% of your available credit taken out. So, you have a card with a $10,000 available balance, and you’re carrying $4999 on it, your credit is fine. Charge a $2 coffee, and your credit score drops. This apparently happens on whatever day your credit card reports to the credit bureaus the owed/available ratio; since they don’t advertise that to people, apparently it’s best for your credit to keep your balance enough under 50% that you can still charge if you need to but not get hit with a credit drop.
We share everything. ‘Nuff said.
We also discuss everything… so if something were to happen to me, she would know where everything is, how to invest, pay bills online, etc.
While I agree that you should have a joint account, I also think it is important for each person to have their own individual savings account as well. For one thing it makes it much easier if you pay the joint bills from a joint account and keep the rest of your money separate if you end up getting a divorce, which I know everybody thinks will never happen but the divorce rate in the U.S. is what — 40% or higher?
My wife and I have one account. Everything is budgeted in Quicken (although with envelopes, not the official budgeting system) and it works exceptionally well. We never (never) argue about money because funds for expenses are always set aside, and we talk through any non-trivial purchases. The only reason we would consider additional separate accounts is for an allowance type of situation. We don’t do that personally, but I see the benefit and have no problem with it.
I can’t understand the relationships where he pays half the mortgage, the cable, the car insurance, and his cell phone, and she pays half the mortgage, the electric and water bills, the groceries, and her cell phone bill, and they take turns paying when out to eat. It’s so bizarre, but so many couples do it! That’s trouble in my book.