Hi there, Mrs. 1500 asking yet another question this week. I want to know if you combine your finances with your spouse or partner.
But first, let’s look at what you said last week, when I asked you What’s the Cheapest Thing You’ve Ever Done?
If you recall, The Mad Fientist met up with his then-girlfriend now-wife in Switzerland, chosen for cheap airfare. They soon discovered that nothing else in Switzerland was cheap, and restaurants didn’t serve tap water. MadFi drank water from the bathroom faucet instead of ordering a drink, in an effort to save money.
I thought this was super-funny, and wanted to know if any of you have ever pulled a super-cheap stunt.
And boy did you NOT disappoint!
Usually I recap in the order I receive the comments, but sorry. Casey B. from CodeAngler wins hands-down with his story:
I’ve many useful items others have lost or discarded. Along High Lonesome trail, I found someone had thrown out underwear as trash. I packed them out as litter, but at home washed them and these are in my rotation.
No contest. Although Reader Shay comes in a close second with her comment
I’m always looking for ways to cut my grocery bill. …
I would get rid of toilet paper if I could, but that is going a bit far for most people.
Yeah, that’s too far for me.
Some of your other replies include Tawcan sleeping in a bus station to save on lodging costs, which frankly borders on dangerous in my book.
Mr. Tako goes to Costco for samples-as-lunch. I can’t say I’ve never filled up on samples… Apparently Mr. Tako and I are not alone, Dividend Monkey and Smart Provisions have also been known to avoid the lunchline in favor of a Costco stroll.
Ms. Montana was more frugal than cheap in my opinion, but I like it anyway because I’ve done a version of it myself.
So… in my early 20’s I took a month off of work to travel coast to coast with by best friend.
Here was the breakfast/lunch plan:
1. Stop at a gas station in the mornings to buy gas.
2. Ask if we could fill our cups with hot water and use the microwave. (Never denied, but I was much cuter in my early 20’s so that might have helped.) We would pop a bag of popcorn we had packed with us. Fill 4 coffee cups with hot water.
3. In the car we would use two of the hot water cups to make instant oatmeal for breakfast. 2 cups of hot water to make tea with our own tea bags. Then eat the popcorn for lunch.
Our version included buying plastic bowls and oatmeal at WalMart, then using the coffee pot in the hotel room to make hot water for oatmeal, but basically the same thing. Breakfast for $.50 or pay $35.00 at a restaurant? Kind of a no-brainer.
Full Time Finance won the college-food lottery with his story:
In college we found out that the local meet process plant resold Deer meet for the price of packaging if the hunter didn’t claim it. We ate deer prepared any way you can imagine daily for the entire semester. The meet was something like 30 cents a pound when all was said and done.
And a final story from a friend. We were over at his house playing Bridge, and he said he gets a 50% discount at a specific parking garage at the local airport when he shows his University ID, but it’s going away because he is leaving his position and it expires in June. I suggested he go into the ID office and get a new one. It will cost $10, but the first time he parks at the airport, he’s made his money back. Plus, it will be good for another 5-10 years. I’d do it…
OK, now wipe those tears of laughter from your eyes, and let’s get a bit more serious.
In the same Podcast Episode 30 of The Financial Independence Podcast that inspired last week’s question, MadFi and Mrs. MadFi discussed how they initially had very different views on money, and decided to keep their finances separate.
Sometimes I like to joke with Mr. 1500 and say:
What’s yours is mine, and what’s mine is mine.
Mr 1500 note: This reminds me of people at my first real job. I worked at the corporate headquarters of Sears and it was a rat-race. My co-rats were always bragging about stupid purchases, but what amused me most was how clingy people were about their cars:
My husband has HIS car and I have mine, which he doesn’t get to drive! Ever.
Who gives a shit; it’s an effing metal cage that gets you to this stupid job.
But really, we combine finances. My getting a full time job has allowed him to cut back on his hours and find more happiness.
I was a stay at home mom for 8-1/2 years with our children – a move we planned for. He worked that whole time, but we shared his paycheck.
Now that I’m in a position to support the family, I welcome the opportunity. What’s mine is mine and what’s his is mine, too. HA!
I’ve met couples with separate finances before, and always thought it was a bad idea, sort of like there was a level of trust missing or something. Why would you NOT combine your finances?
Derek from How Do I Money? wrote a book with his wife called One Bed, One Bank Account: Better Conversations on Money and Marriage. Derek and Carrie had to have some pretty serious money talks early on in their marriage, as she was going through a short sale on her home, and he was more money conscious.
I’ve always been a combined finances person, and the argument against combining always came up short – until I hear MadFi and Mrs. MadFi talking about how and why they chose this method.
I want to know about you. Do you combine finances? Is there a significant earnings gap between you and your spouse? If you do not combine finance, and there is an earnings gap, do you still pay equally for shared bills, or does one of you pay more than the other?
Was this a mutual decision? Grudgingly accepted? I’m really fascinated, and there is no wrong answer.
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When we got married we started with separate finances. I have strong fear of not having my own money. Before getting married I was quite independent and we always split every single expense in half. As married life progressed we learnt to achieve a happy middle ground. We still maintain and manage our separate bank accounts but almost all of our investment is in a single shared account.I usually end up buying more clothes and don’t think it is reasonable to ask him to part with his money because I fancy something.
All of this applies to our salary from our day job and the fact that we earn nearly identical salaries helps a lot. Any freelance income we share equally.
In past few months we have been increasingly talking about maybe joining finances and planning for cases when one of us looses their job or has to take a break.
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Thanks for sharing, Mrs. S.
You say you have a strong fear of not having your own money. Do you know what that stems from? Did you grow up without a lot of money, or did you see your mother or father struggle? Have you watched friends struggle after a divorce? How old were you when you got married?
(Sorry for being nosy, feel free not to answer anything that makes you feel uncomfortable…)
It comes down to trust. We got married because we loved and trusted each other and immediately shared bank accounts and savings – but then in those days we really didn’t have very much to share. There are no money secrets in our marriage, the money is just a means to an end and not the thing that defines who we are so why would we keep it separate / hidden. And who has time to manage separate accounts?
Thanks Carol.
In the beginning, we didn’t have much either, but it sure felt like a lot.
We each had a property and a car, plus no credit card debt, so what else is there?
Yea there is a big wage gap between me and the Mrs especially now she is looking after our young daughter but again we’re in this together! One tweak which improved things though (I.e. Reduced petty arguments) is that we transfer out “fun money” each month into separate accounts. This still gets tracked but there is less questioning of each others spending this way, and we still try to save out of this fun money if possible, it’s not seen as a target “I must spend this much this month!” 🙂
Based on discussions with friends when finances are kept separate the bills are split in proportion anyway, so it all amounts to the same thing! But I can still appreciate any people would want to do that.
We’ve always had a wage gap, although it grew at a fairly rapid rate. Mr. 1500 always made more than I did, but once he became a contractor his hourly rate went way up.
I stayed home with our daughters until the youngest was in Kindergarten, so I was bringing in nothing. But we had this conversation way before I got pregnant – or was even thinking about getting pregnant, and we planned for me to stay home, so we saved extra to be able to afford the loss of my pittance, er salary.
That was too funny reading some of the replies about the super-cheap stunts!
My wife and I (of 23 yrs) have always combined finances. Over the years, she shifted to being a stay at home mom for our kids as they grew up – and then went back to work part time once they were a bit older. I’ve always worked full time. This year our youngest in graduating from high school – and at the same time I’m going into semi-retirement. I’ll still be doing some things on the side that I’ve been doing the last couple of years – but it will be all on my own. And it will allow us to travel more! We’re in our mid to upper 40’s and excited about the freedom that lies ahead – in large part due to diligent saving and spending well below our means for the last 20+ years.
I really enjoy your site and reading about the journey you two are on – best of luck in all the things that lie ahead!
Thanks Lance.
I wonder if it’s an age thing? In my parents day, no one had separate finances. We’re mid 40’s and have always kept them together, but perhaps the younger couples are keeping them separate?
Before my wife stopped working late last year we had combines finances (it goes without saying with one income we combine). The reality is in a divorce (not that I ever expect one) a split wouldn’t matter. For management perspectives it’s easier to manage less accounts. That being said our entire spending budget was based off the lower of our two incomes. We have discussed setting a budget limit on splurges per person, but so far nothing. I do handle all bill paying and investing, but we do review numbers together as she sets much of the actual budget.
Thanks for reading, FTF.
I’m not so sure that in a divorce, split finances wouldn’t matter. Of course I don’t know anything about this, I’m making it up. But I would think a judge would look at separate finances and figure there’s nothing for him to split. Maybe the joint account paying the household bills…
Mrs. Freedom 40 and I are both pretty independent people and we’d both been living on our own for years before we got married, so totally combining everything just didn’t make much sense to either of us. Over time, we’ve slowly merged some things, but we still each maintain separate checking and savings accounts. However, we’re pretty coordinated on how we pay for big things like the mortgage and what is a reasonable percentage based on each person’s income. I think the most important thing we do that makes it all work is to keep those lines of communication open!
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That last sentence…
“I think the most important thing we do that makes it all work is to keep those lines of communication open!”
My girlfriend and I live together and talk about this subject often. We do not combine accounts, but she is happy giving me some money every month to cover her half of the groceries and utilities. I imagine when we are married, we will get a joint account to cover bills, and have separate savings. I like the idea of one of our paychecks going to bills and household expenses, and the other being stashed away for vacations/gifts/emergency find, etc. We will probably try out a few variations to see what works for us.
OMG I love that you talk about this subject often before you’re married. With money being the number one thing couples fight about, discussing it before you’re hitched is so important. (Says the girl who didn’t…)
Considering we are pretty much on the same page financially, we have combined finances a long time ago. Not combining finances would in our case be detrimental to the overall investment potential.
We talk a lot about our finances and bounce ideas of each other. When we don’t agree we always make sure that we compromise. Has worked miracles so far! Communication is key 🙂
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Thanks Team CF.
I agree that not combining finances would be detrimental to us.
I’ve never fully understood having separate bank accounts for each spouse but if it works for people that’s fine. To me it gets back to our shared life goals. Those goals include how we want to live today and how we want to live in retirement. And it makes no difference if there’s an earnings gap. We have the same goals and so we manage our money together. Plus, it’s simpler, and since I manage the finances I like simple!
Me & my husband have been together since we were teenagers just getting our first poorly paid weekend jobs. As soon as we moved in together we opened a joint account and have never looked back. It wasn’t even a question of not combining our money. Now we’re older and more established in our chosen professions, he earns significantly more than I do but that’s never, ever been a source of disquiet. We’re a team, working towards a shared life goal.
Precisely how I feel, too.
My wife is a stay at home mom so she can care for our son and her special needs sister. So since this is the case we definitely combined our finances together right when we got married.
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This was our plan from day one, too so we combined right away.
We, the RIPs, are getting married later this year in Switzerland so we split our timeline in two:
Before getting married:
– each one handles/owns his/her own finances and cashflow.
– each one pays “couple taxes” into a shared account, in ratio 3:1 which is roughly our salary ratio. Currently we pay 3K + 1K = 4K. If the shared account runs low, we pay extra according to 3:1 ratio.
– we use the shared account for shared expenses, which is essentially “everything but personal leisure/splurges”. I’m keeping my personal expenditure very very low, roughly 50 per month, Miss RIP is doing almost the same
After getting married
– default in Switzerland is “the value of what you had before wedding remains yours, whatever you make after wedding is shared – excluding inheritances” and we’ll stick with that. You can change this to “fully shared (including the past and inherited wealth)”, “fully separated” or “whatever the hell you want” if you sign an agreement in front of a notary.
– we’ll change bank account where our salaries are being credited to the shared one.
– we’ll give ourselves a “monthly leisure salary” taken from the shared account for our splurges (the opposite of what we do now).
– I’ll take investment responsibilities for the couple.
Plus, from a bookkeeping point of view I’ll combine my Net Worth add Miss RIP (ahem… Mrs. RIP)’s one. Net worth is going to instantly “skyrocket” (well, Miss RIP has not had the opportunity to accumulate as much as I did) and our saving rate will be back at 70%!
When it is spelled out like this (the before marriage scenario), it makes so much sense.
Thanks, RIPs. And Congratulations!
My wife and I have had combined finances before we got married, we lived together for about a year when we were engaged. I believe it’s about trust, communication and What’s yours is mine, and what’s mine is mine. We joke about that all the time.
It has to be an open discussion and both sides need to be willing to compromise. We are much better working as a team, than individuals. We don’t make any big decisions without one another.
I can understand how some couples might have fear of losing a say in their money, or possible have had bad experiences in the past that have affected how the view money going forward, and it could take time for them to trust a new relationship and money.
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Thanks for reading Brian.
Did you fully combine before marriage?
We have a “one foot in, one foot out” policy when it comes to our finances.
We both have a combined bank account, which is used for paying most bills. Our workplace savings accounts are obviously not combined … but something we both agreed on early in our marriage is keeping our own “play money” accounts.
The “play money” accounts are ours to do with as we choose. So, if we want to make some dumb purchase the other person would never approve of — it comes from that person’s “play money” account.
Our rule is, if something is purchased with a “play money” account, the other person can’t say shit about it. It removes a lot of arguments.
This gives each of us some autonomy and control over “our own” money, but most finances are combined.
This is a nice hybrid solution.
THIRTY cents a pound for DEER??? That’s a crazy low price!!! I don’t eat deer myself, but I’m in a family of hunters, and I’ve never heard of meat that low (when you can find it at the store). That’s a jealousy-inducing price right there, my friend.
I miiiight still use my student ID to get free things. I’ve been out of college for four years. 😛
I feel the same way as you, Mrs. 1500. We have friends who are married and keep their finances totally separate. That never made sense to me, because why get married at that point? Wasn’t the point to share everything and work as a team?
But now I understand that all couples work differently. Different strokes for different folks; some people prefer the security of separate accounts.
For Mr. Picky Pincher and I it wasn’t even a discussion. We combined our finances once we got back from our honeymoon. Mr. Picky Pincher was initially resistant and wanted to have an account just as his slush fund, which I had access to and could view anyway. I didn’t push the issue, but it did hurt my feelings. At the end of it, he realized there was zero point in having a slush fund account since it was the same as our regular joint account. We got rid of that extra account and keep everything in one savings and one checking account. It’s simple and it works for us. 🙂
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I’m still single, so I’m not sure what will really happen. But if I did have a significant other, I will say that our finances will most likely be combined. I’ll educate her or maybe she’ll educate me about finances and we’ll have open and honest communication with each other to work on almost everything together as a team.
I can understand why some people would want to mix finances as it would be easier to keep track and split, just in case of the divorce. But I think that when two individuals get married, they shouldn’t have splitting up on their mind, and instead work towards making each other happy “till death do us part”.
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I used to think like that, but I’ve dated guys who have kids with their previous wide and that has me thinking about estate planning and child support.
For instance, it would be totally reasonable for my future husband to not make me his soul heir/beneficiary so his kids are looked after. I hope to find someone to fully partner with, but does that mean I split child support costs too?
I think it’s more important to me to find someone who shares my values and goals when it comes to money. I’m more worried about finding someone who doesn’t want a huge mortgage, fancy cars, lots of stuff — that’s more important to me right now than worrying about how we’ll split the cost.
I live with my GF. We don’t totally combine finances but we do sort of combine our expenses. Since there is a fairly large income gap, the larger income earner pays a little bit more of the bills. We don’t pay expenses in the same ratio of earnings because the higher income earner would be subsidizing the lower income earner quite a bit and we both felt that wouldn’t be right.
This system works great for us and others just need to sit down with their other half and figure out what works best for them 🙂
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It’s imperative to combine finances with the significant other long term, especially if one spouse spends at least some time on these money blogs. 😉
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We combined our finances when we got married. I didn’t even knew there was a different way. Luckily, we both have similar money values so we did pretty well.
I think it’s better to combine the finances because that mean you’re shooting for the same goals.
Having separate finances is okay too. You just have to figure out what works for you.
I was 19 when we married, and together we were 50k in debt. So we went all in and never looked back! 6 kids, 27 countries, owning 3 homes, and FI later, it’s all worked out just fine. Plus now that we have a zillion kids, we are stuck together. Can you imagine getting set up on a blind date with someone who has 5 little kids at home?! Ha!
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The Mrs and I maintain separate accounts, but we both have access to everything and we run all of it through one personal capital account we both log into.
We do both maintain separate credit card accounts to maximize rewards and sign up bonuses that we can consolidate.
We also do the separate credit card thing when there’s a really great sign on bonus to get. But it’s just separate because we’re trying to snag all the bonus miles we can.
I had been working for over a decade when I met Mr. BITA and I was used to having complete control over my own money. So we kept everything separate and split big expenses like the mortgage down the middle even after we got married. Then I applied for a green card (a resident permit) and our lawyer was less than pleased when she discovered our separate accounts. Apparently it is one of those things that the INS looks at to determine if the marriage is ‘real’ or if I was using Mr. BITA as a stepping stone to citizenship. So our decision to combine finances was made for us by lawyers and the federal government : ).
I do still have money in India though, and that is only in my name because we are lazy as fuck and could not be bothered with the giant pile of paperwork that would be required to make that a joint account.
I think this decision is very different depending on couples who earn differing amounts and come into the marriage/partnership with different amounts. We put in 50% of our salary in the joint account and it is all used for our joint investments and bills. Even though we’re both frugal, we also save different proportions.
The husband (married 6 months so far) have a joint account and separate accounts.
We don’t consider the higher earner subsidizing the lower earner as you make life decisions together. Otherwise the higher earner would always have a surplus and feel they aren’t living life to their fullest potential.
If for example one person chooses to stay at home to raise the kids, is the higher earner subsidizing the lower earner? And does that mean the kids then only belong to the one doing most of the work? Working in the charity sector, having combined finances has often put women in a greater precarious position.
I’m surprised how many people here share their finances.
I see lots of people here giving the standard wishy-washy “It’s not for me, but if it works for you…” advice, so I’ll go ahead and take a stand.
In my 50 years on this earth I’ve known a number of couples who kept separate finances in marriage. Every one of them is now divorced. Correlation is not causation, so I am not ~blaming~ the divorces on their finances, but folks there IS a correlation. I’ll leave it up to smarter people than I to figure out the “why”, but my advice is simple… don’t keep separate finances when you are married.
I firmly believe that whether you keep your finances separate or combined isn’t the important part. What is important then? Communication and shared goals and futures. My husband and I didn’t fully combine our finances for a variety of reasons, but we do talk about money on a regular basis including what we are investing, when we get raises, what our taxes look like for the year, our investment allocations, how we feel about debt (no thank you), what we’re spending our money on, etc. That communication is far more important than our money is arranged exactly into accounts. For the record, I know people older than you who have kept separate finances their whole marriages and are still happily together.
Have you thought about the possibility that perhaps having separate finances gave the couples the freedom to leave when the relationship was no longer working for them because they were financially independent rather than being being chained to their higher income earning partner to be able to maintain their lifestyle?
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I’m wondering if those couples kept their finances separate because they knew it wasn’t going to work out?
We’ve all known couples that you just knew weren’t in it for the long haul. Yes, its sad when a relationship dies, but there are relationships that are destined to fail, mainly because they aren’t built on a solid foundation.
I just got married in September and we chose to not combine finances – we got a postnup detailing this even. The agreement does allow us to change our minds later and deposit future income into a joint account. But for now we are keeping things separate. Why? We both have strong assets, with one person having a decent chunk more than the other and the other having a higher income. Making everything post-marriage combined without combining pre-marriage assets would have been unfair to the higher income earner and the person with higher assets would have had to work for many more years to make up for losing half of their current assets in a hypothetical future separation. We have a joint account that we contribute to 50/50. Like Fervent, we don’t want one person to subsidize the other’s portion of the joint lifestyle. We plan to revisit our arrangement every five years or when a big life change happens like moving or deciding to have kids.
We are still pretty new to this marriage thing so we will see how things change in the future! So far, the joint account is a huge improvement over dating as it makes it easier to budget and keep track of things. All this said too, we spend plenty of time talking about our money even though it’s legally separate. It’s impossible in a marriage to keep fully separate finances anyways.
I do believe communication is the key, and ultimately the only two people on the planet that your arrangement has to work for are the two actually in the marriage.
I dated a guy for 7 years when I was in my 20’s and he was very bad with money, so I have baggage from that. I also have had friends divorce, some amicably with finances and some not so much. My parents were married for 23 years, before they divorced. Of course ya gotta go into it with a Forever mind set, but over those 23 years as they developed as adults, their paths diverged. Being independent for this long, I plan on (a) a pre-nup and (b) separate funds, plus a joint account for joint expenses when I find the right person.
The ex – when I told him I’d kept a bit of money to at least pay 1st month’s rent if we had to move out of the house into an apartment, his response was “WHY! I could have used that to pay some of my bills.” We did not have combined expenses, but I was not going to be be penniless begging one of our parents to take us (=2 cats) in. When he came into money at one point (house refinance, or sale, etc), I submitted to him an excel sheet ‘bill’ of all of the things I’d loaned him money for, each time saying “this is a loan, you’re going to pay me back” and him agreeing. He was shocked that (a) it came to ~$7000 and (b) that I was asking him for it. When _I_ realized how much, I became more cautious about lending him money.
I was paying all of my own bills, plus cable, plus paying him rent, which was in theory towards one of the extra rooms, which later both were rented out (think about that one for a minute), and generally grocery shopping, paying for that. For a while I let him drive my second car (my mom’s mini van when she was done with it because it worked well for our hobby), with me paying insurance, registration, repair when he hit a deer and it needed a new headlight, etc because he couldn’t afford repairs or registration on his car.
A friend of mine – she worked and her husband wasn’t motivated and spend his time playing online games, and it turns out, flirting while she was working all day. In the divorce, she was forced to disburse her entire 401k, she paid the taxes, and then he got half. This is one reason I plan on a pre-nup, so that my existing retirement savings stay mine.
I have other friends who both were working when they got married and it was agreed they’d both work until/unless something changed (such as having kids (neither was really interested but who knew), an unplanned illness, an epic career opportunity – but each would be a discussion). She wasn’t so motivated to work. Her company offered “summer Fridays”, work 9 hours for 2 weeks, to have every other Friday off. Only then she’d also take off Monday because she partied too hard over the weekend, and some of that behavior continued after the summer. Her very nice company then wrapped her into a round of lay offs instead of a straight termination, so she got severance and was eligible for unemployment. The motivation to get a new job was lacking. Among other things, they realized they were not aligned on goals in life and eventually decided to divorce. This process was taking a while, where he ended up paying her taxes last year, because it wasn’t finalized. She has trust fund money from parents, but they seem to be helping less because someone showed me her go-fund me page because life is hard and omg these legal bills (when she was stalling on following up with the lawyer). *shakes my head*.
Another friend knew her fiance often bought CD’s, went to concerts etc, but she didn’t really know his consumer debt until they got married. They tried various methods (cash only, tracking spending, both being on a budget diet) to get it under control and paid off. It’s taken a while, and they are in a good place now. Yet another cautionary tale to have those talks _before_ the wedding.
All of this! Has me cautious, and as much as we love someone, start on the same page, have discussions to evaluate money…I’d rather protect myself, and as things continue to go well more can go into the joint account.
Now this is a great story. I mean, it’s terrible all those things that happened to all those people in their relationships. That part isn’t good, but you told it well, and it comes from experience vs. the “what-if” universe.
These are the types of things you absolutely do NOT think about when wearing rose colored glasses in the haze of newly-wedded bliss. (I sure didn’t think about them.)
Thanks for sharing!
My spouse and I do not have combined finances. I have my accounts and he has his, and we each pay different expenses. Our incomes are fairly close, but my income is largely fixed, as I am a salaried employee, whereas his is variable, since he is self-employed. So for the most part, I pay the fixed expenses and he pays the variable ones.
The fact that we don’t have combined finances doesn’t mean that we don’t share our money, however. I do all of the tracking for our income and spending, so he provides me access to his accounts whenever I need it, and if there is an expense that one of us has paid that the other should cover part of, it is easy to transfer the money. We still have to communicate about money and trust each other, since this arrangement relies on our transparency with each other rather than direct access to the accounts.
Mrs. Done by Forty and I started combining finances like 4 months into our relationship, when we moved in together. We figured if we were sharing housing expenses, and a bed, we needed to share in our finances, too. It started with a joint checking account that we used to split everything right down the middle: rent, utilities, groceries. It grew from there, as we started sharing our plans for our future (saving for our first house, saving paying down debt, retirement, maybe kids and a wedding).
When I proposed on the anniversary of our first date, we were already intertwined financially, and haven’t looked back.
Done by Forty recently posted…The Leap Away from Work
We combined finances for a number of reasons, among them that, despite what capitalism seems to think, my wife’s lower-paying job is no less valuable to society (if anything it is more valuable to society) than my higher-paying job. Although not a solution to this societal problem, it’s something we can easily correct within our household by sharing income. This same logic applies to other imbalances, e.g. the bizarre fact that employees of large companies with 401k plans can shelter more of their income in retirement accounts than employees of small companies.
There are downsides if you aren’t perfectly on the same page with regards to saving goals as your partner, but those can be overcome with communication (and continual prodding to FIRE 😉
My partner and I aren’t married, and we don’t combine finances. I don’t think either of us would be comfortable doing that even if we did get married. We have a joint account where the money that the Airbnb space in our house is deposited, and the mortgage and Airbnb expenses comes out of that. We divvied up the bills each of us is responsible for and trust that we will pay on time.
I was in my late 20s when we started dating and had already inherited a fair amount of property and assets. He was divorced and in his mid 30s when we started dating and had (has) a ton of student loans that he is in no hurry to pay off.
If we were both 18 and building our assets together, combining finances makes sense. But we were already fairly established adults with drastically different financial responsibilities (me with a house and inheritance and my own student loans, him with a kid and student loans)
Plus, him having a kid complicates things. Should anything happen to Mr. BL kid should be the rightful heir/recipient of Mr. BL’s accounts. If Mr. BL and I combined everything it would probably be easy for me to say it’s all mine (not that I would) and it could also be difficult to separate what kid is owed from our joint accounts.
Even though our finances are separate we still work toward our goals together. I trust my partner to do what he says he’s going to do and him me. We have discussions about what we want and how we’re going to get there just like couples who combine their money.
The kids throw a MAJOR monkey wrench into the finances.
We combined our finances when we got married. It’s just easier to manage. We just group all the incomes as one and use that to plan our monthly budget. Seems to work well as our net worth has grown substantially the past few years. I suppose don’t fix what isn’t broke. 🙂
Any sleeping in bus station isn’t dangerous if you use some common sense. 😉
I will give you my spot at the bus station!
what seems to have worked is one joint account and each with their own “play account” – the play accounts hardly have any money in them, but it does allow us each to do and buy whatever it is we want (little things really) without any comment or question – this works because we’re not always on the same path when it comes to managing money – i am much more driven to attain FI NOW where the Mrs’s position is i don’t want to forgo living NOW. Still working on bringing her over to the FI side 🙂
First time posting but I have been following your blog – – thank you for sharing your journey.
-Corbett
Bringing her over to the FI side. I love that!
what seems to have worked is one joint account and each with their own “play account” – the play accounts hardly have any money in them, but it does allow us each to do and buy whatever it is we want (little things really) without any comment or question – this works because we’re not always on the same path when it comes to managing money – i am much more driven to attain FI NOW where the Mrs’s position is i don’t want to forgo living NOW. I have yet to get her to come over to the FI side.
First time posting but have followed your blog – – thank you for sharing your journey.
-Corbett
My wife and I have always had separate checking accounts. I do make a lot more money than she does, but we both contribute what we can to our joint savings.
We also found a way that works for us for bills. We each have our own credit cards and she pays for hers and I pay for mine.
I pay the mortgage payment and most of the bills and she pays for groceries.
Having the separate accounts is great because I’m very picky and need every receipt and she’s the opposite.
I don’t think we’ve ever really fight about money. Don’t ask me why it works, it just does. 🙂
— Jim
Who pays at a restaurant? You each get your own check?
Haha, good question… we don’t really have a set person to grab the check, but I think that tends to alternate for the most part.
However, we don’t eat out a ton so that’s never really been an issue for us.
— Jim
Jim @ Route To Retire recently posted…Why I Ended My Costco Membership
My husband and I have been married for nearly 9 years. We were both married previously (once) and we each had somewhat significant investments when we met. With each job I held, I left behind a 401k and never touched it.
When we married, I became a stay-at-home mom to his 3 kids (none of my own) and he had a pretty high income. I put a few hundred thousand $$s into the downpayment of our home (to avoid PMI extra fees) and he paid the mortgage and all bills. When I returned to work, every single penny of my income went into my investments while he continued to pay for our life and still socking away savings. I retired last year at 46 and he’s working 15 hrs a week as a consultant with no benefits. This income pays for most of our annual spending.
In the past year or so, we have consolidated every penny of our investments at the same bank. He’s a bit more aggressive than I am so his portfolio matches his investment style while mine is a bit more conservative. We can view each other’s investments but it’s easier for us to keep them in their separate buckets.
Maintaining different accounts takes no extra effort and keeps the peace. Also, in case we die together, we have different wishes for our money.
When I hit FI, we sold the big house and moved into an investment property he owned before meeting me. It was half paid off. When we transitioned to the new space, I paid the mortgage off making it 50% ownership for each of us.
This system works well for us!
My husband and I started dating when we were 15. By the time we got married at 23 we had been together for 8 years. We knew and know each other so well that sharing our money was easy because we: a) didn’t have any, b) had grown up together and nothing was a surprise and c) came into the marriage with the same simple goals of buying a house (we live in Indiana where 23 year olds buy houses all of the time. It wasn’t that hard to save that small of a downpayment! Ha!), having kids and then I would stay home. I think when you start out together at such a young age it is an easy transition from sharing your soda at lunch to sharing your IRA’s. ?
We combined everything from the get go, although Mrs. SSC wasn’t as aware of how much debt I had until we applied for our mortgage. We had been dating long distance about a year and took a house hunting trip to LA during the summer so we’d ahve a place to live when we relocated to our jobs that fall. They ran her credit score and he smiled and said, “I can get you a good rate, now let’s get his” and he ran mine and got this shocled look on his face and motioned her over. She came over and they murmured and looked at the screen, and her face said it all; shock, horror, dismay.
We still got the house I just wasn’t on the loan, although she put me on the title (I’d wring my daughters neck if she tried that – aye yi yi). All of our finances went into combined accounts and bills came out of those. Since she’s our CFO, it’s always been combined, and I think my debt helped establish not ahving XX amount of money to spend each month so we couldn’t inflate our lifestyle too much at the beginning. $18k in credit card debt and $64k in college loans will do that for you. That all got paid off the first 2-2.5 yrs and then got rolled into extra investments instead of acting like we just got that money back to spend.
I know couples that keep things separate, and i just don’t get it. It doesn’t seem like you’re committed, or trusting of the other person. None have gotten divorced yet, but we went full bore combined almost before we were married. We bought a house before we were married, and had combined accounts for ~3months before we were married, and we’re coming up on 10 yrs of marriage now, so something went right.
As far as allowing for my horrid spending habits, we adopted allowances and I ahd my allowance and she has hers and there’s no questions asked on what it gets spent on as long as it’s not overspent. That worked great for us, and while the things it is now required to cover has changed dramatically, it still is a good system for us.
Mr SSC recently posted…Goodbye Quinn
Always commit to staying on the same page and seeing your spouse as the solution, not a part of the problem. I speak from experience: 17 years, everything combined, and my ex left in a midlife crisis. He regrets it, but it’s gone.
Though, I will say that we divorced quite well.
We’re slightly a mixed bag with some of our finances combined. When we started out dating over 10 years ago, we had separate finances, and even when we got married we still had separate bank accounts with one joint account to pay bills out of. Once we took the path of FIRE though, we both decided that was it and while we still have separate bank accounts, all of our efforts are combined (joint credit cards for travel hacking, making sure both of us can max-out 401k & IRA for the year etc.)
Seeking Saturdays recently posted…How to Start Liking Beer
My husband and I were married straight out of college, and for us it was a no-brainer. Combine finances. Our parents did it… Not to say, we didn’t have our differences. I was the saver, my husband, well let’s say he didn’t trust himself with a debit card until 10 years ago.
What we did find out over the years is that I am very good at budgeting and my husband is very good at investing. So we joke that I save the money for him to invest.
Really interesting to read all the different experiences and opinions. Will read some more posts later on but first this:
We started with combined finances when we bought our home almost 3 years ago. We were, like many, already on the same page when it comes to money. We also had (and still have) a big wage gap, but this doesn’t have any impact in how we save or spend our money. Everything comes in on one big pile of money. And everything is being spend as we see fit (after the automated savings and bills are through).
The tracking is separated though, as where I do all the work (and like it). But we do talk about it on how it’s going. Same with investing, everything we do is decided together and we often have ‘finance nights’ were we discuss ideas on investing opportunities.
I think if there is a specific plan of work and understand each other, the combined financial problems will not be too difficult. Regardless of a task or a project will be the first difficulties. The important thing we have to overcome and accomplish goals.
My wife and I have always combined our finances. It generally works like this: I earn, she spends. Ha! Well, ok, so she does a fantastic job homeschooling our children, managing our day-to-day finances and being a wonderful, amazing partner in life. There is no way I would be this far along the road to FI without her. We were lucky to have very similar philosophies on money, charitable giving and life goals. She was in her PhD program when we started having kids, so one of our FIRE goals includes getting her doctorate after the kids are out of the house. Then it’s her turn to have a career for as long as she enjoys it. We never even considered keeping our finances separate, because we were all in as equal partners the moment we got married. At the beginning, I got her school debt and later, she got my school debt! Later, we used my earnings to fill those gaping holes and now have a positive net worth larger than our negative net worth was.
We aren’t quite at 1500 days to freedom, but are closing in on it and will be there later this year if all goes according to our plans. Have your 1500 days drug along or flown by? I’m starting to get a little excited, but trying to keep a lid on so I don’t get too impatient and burn out early.
And yes, if you look at my website you’ll discover that I’m a poser blogger for now with a website but no content. I’ll try to remedy that as soon as I figure out WordPress and get the motivation/time. That’s what happens when a guy who always hated writing papers tries to be one of the cool kids with a blog…
We had that very same arrangement! He made the money and I spent it! Worked great for me!
Also, if you need wordpress tips, send me a note. I’ll try to help.
When we got married, we agreed to combine finances. My income is his income, his income is my income. On the same note, my debt is his debt and his debt is my debt.
We deposit most of our paychecks into one joint checking account. I say most of our paychecks because we each have separate accounts for our allowances and hobby budgets – we have the same $ limit even though we earn different amounts. All of our mutual expenses (rent, insurance, debt, etc.) get pulled out of the checking account so that our separate allowances can really be free to spend however either one of us wishes.
Lisa recently posted…17 ways to improve your finances in 2017
Mrs. ROB and I combine finances to an extent. Mrs. ROB is very independent and we have some different ideas about money. So what we do is have a yours, mine, and ours account. We contribute a percentage of our income to the account we pay our bills with and then Mrs. ROB, whatever she has left, can basically spend on what she wants. It has solved some of the conflict over money. It isn’t perfect yet, but hopefully we will grow to a point where can merge all our accounts.
Mrs. Zero and I had nothing when I tricked her into marrying me. :).
In fact we had negative nothing – $60-ish thousand of student loan debt and a few grand on a credit card. Mrs. Zero had never had her own place. I had no income (still finishing up engineering degree). We went joint accounts from day one and I think this “we’re in this together” approach enabled our journey from debt and stupidity to an almost $1M net worth. What we have (the bad and the good) is ours and of our own making. We learned together.
– Zero
P.S. I hit the jackpot when I married sweet Mrs. Zero.
Big old savings / emergency-fund account is joint.
Checking is split (mainly because i earn more and im too lazy to switch over all the expenses that auto-magically come out of my account). As long as money in savings goes up, nobody cares. We discuss large purchases but neither of us cares about piddly stuff or “fun money” purchases.
She wants nothing to do with the brokerage account (doesn’t understand it and it makes her nervous seeing it everytime she logs in).
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In the past relationship, when just starting out, everything goes into joint. We each would get fun money every month and chose how we want to save/spend it. She gets new purses and shoes. I save up for a year and buy new computer. Nobody complains.
Divorce doesn’t matter together or not. You each have to list every single asset you own. If its messy lawyers and ultimately judge decides. I will tell you i got a very very nasty female judge that basically wanted to screw the men. She kept hinting/intimating to my ex that she could get more out of me (even tho we did 50/50 split and i kept the fugging underwater mortgage). Thankfully my ex didn’t want to screw me. It’s akward because you basically are in a room with other people. She did the exact same thing to everyone who came before us. I’ve heard other horror stories from guys at work; if you have kids you are doubly screwed. Know a guy making like 160k a year and he has to give her half of that for 15 more years, and she remarried within a year! WTF.
We’ve combined our finances from the start (married 20 years now). When we started, my wife was working full-time while I went to grad school full-time. A couple years later, we were both working and making about the same amount of money. Now she makes over twice what I do. Our finances are still all combined. Our paychecks are direct deposited into our main checking account, and all our credit card bills, etc, are automatically paid out of it. We’re on the same page about spending habits, etc, so that’s not an issue.
One thing that we’ve done recently that’s helped smooth over some disagreements is to each have a certain amount of money to give away during the year however we see fit. We can support various non-profits, help a friend with rent, or give it however we want. We track it all on a shared Google spreadsheet. It’s fun. 🙂
We also have a bigger chunk of money that we give away together (mostly to our church), but we’ve been on the same page about that from the start, too.
My husband, David, and I combined our finances pretty quickly after we moved in together. Initially, we opened a joint account for common bills and each had our own accounts for individual expenses. By the time we bought a home together five years later, our finances were completely merged. We did this because, at the time, same-sex marriage wasn’t legal and David’s family is very unsupportive. We didn’t want there to be any questions of who owned what and whose was whose if anything would’ve happened to David. Consequently, we’re beneficiaries on each other’s retirement accounts and have all our legal documents in order: joint tenancy, DPOAs, living wills, etc. For our own security, it was the best thing to do. Thirteen years later, we leave it as is because the system works for us. I do see why some couples keep assets separate and say to each their own.
I would prefer combining finances. A married couple would share their finances.