How Do Couples Use Joint Accounts?

I’m going nuts. My husband and I share a joint bank account in addition to us each having separate accounts.

The problem is how to use the joint account. Just bills? Groceries? Do groceries include beer from the liquor store?

I’d appreciate any suggestions, including those of the commentariat. I know that my husband and I need to work on our communication about money, but a starting place for a conversation would be helpful. — C.

I haven’t been in a position to need a joint account, but the topic has been covered on our site a few times.

Here’s E.A. Mann on the “limited joint account,” which one of the things that helped stop them from fighting about money.

If she was meeting all of her financial obligations and goals, why should I have cared if she spent $90 on makeup and hair goop? The answer is that I shouldn’t have. I know this, but human nature is hard to change. Even when I was good and brought up purchases in a neutral way, my wife still felt she had to explain herself. Not good. Better, we found, was to open a joint account for joint obligations only, like mortgage and utility bills. Now we both pay in to cover expenses, and the rest goes into our solo accounts away from the prying eyes of the other person.

Here’s Bowen Close on her joint accounts:

We opened a joint checking account, a joint savings account (which we immediately split into savings sub-accounts for travel, education, and general savings), and two joint credit cards. Our paychecks went into our joint account. Once or twice each month, each savings account received an automatic transfer of money from the checking account.

We each retained the personal bank accounts we had before the merge. Birthday gifts and academic awards also went into our personal accounts, and each month we each received an automatic transfer from our joint checking account. Our personal accounts were ours to do with as we liked, with no oversight from the other person.

And Katie Wilson on joint expenses:

It took me a long time to work up to it, but I have to say, joint checking account is THE BEST. It is just so nice and comforting to not worry about keeping track—or cashing each other’s checks. We only have joint accounts at this point, actually. All paychecks are direct deposited to the joint checking, all bills get paid out of it (including credit cards, which are also joint), and there’s a twice monthly transfer to savings (also joint). Retirement plan contributions are withheld pre-tax.

Have any advice for C.? Let her know below.

 

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57 Comments / Post A Comment

EM (#1,012)

My partner and I got a joint account after a year of living together– we found keeping a joint spreadsheet of household expenses suuuper tedious. We pay all our bills from it (rent, internet, power, renter’s insurance) and also buy all common household expenses: liquor, groceries, cleaning supplies, toothpaste, movie tickets etc. Also meals out, unless it’s a special occasion where one of us is treating the other to a birthday dinner or something. If it’s something we both use, we buy it on the joint account. If you weren’t a beer drinker, I could see you asking your husband not to buy beer on the shared account, for instance.

We’re still working out how much to contribute to it each month, since it’s a new thing, but we both just deposited a bunch of money into it and we’re going to track how much we spend out of it and top it up equally when necessary.

We don’t have a joint credit card, but for example, if I buy us flights or book a hotel on my credit card, my partner just directly pays his half of the expense onto my credit card. This seems easier and preferable to getting a joint one.

So far this system works great for us, but we’re both employed and fairly financially secure, so grocery expenses aren’t a relationship stress. I can see it being more of a contentious issue if you were in a relationship with someone who had way different spending habits than you, or if you weren’t each contributing in a way that felt fair.

garli (#4,150)

Well a good starting place is how you currently split bills.

ThatJenn (#916)

@garli This was essentially what I was gonna say. Also, if you both feel confident that the other will stay solvent and you don’t feel like talking about money often, keep the joint account to as few things as possible. I love paying most of my bills separately from my husband. It really isn’t necessary for us to pay his cell phone bill and mine, which are on separate networks, from the joint account; we can each just pay our own.

iseeshiny (#6,178)

I’d say that it varies for every couple, and you two are the only ones who can really say whether the beer should go on the joint account. (Like maybe only one of you drinks beer, and likes to drink only expensive beer made from Trappist monks and diamonds, and the other person doesn’t drink or doesn’t drink much and only drinks Charles Shaw and the difference causes issues, in which case it would be a good idea to keep such things separate. Like if it’s something that will breed resentment, keep it off the joint account?)

I’ll also say that when my now-husband and I first moved in together, we opened ours out of laziness – it got tiresome really quickly, keeping track of expenses like rent, utilities and groceries and who owed what to whom. So we figured out about how much we spent monthly, divided that by two and then again by four and every week we’d deposit that amount each. It helped that at this time we were both working in restaurants and went to the bank weekly anyway and that we both made about the same amount of money. Over time we figured out we had the same approach to finances and were inclined away from excessive impulse spending and talked over big purchases together and didn’t nickel and dime each other over our not-excessive impulse purchases, so by the time we bought our house together we just merged all our funds anyway and it ended up not being a thing anymore. But we kind of lucked out there.

MissMushkila (#1,044)

My boyfriend and I got a joint account about 1 year after living together, for similar reasons to EM above. We were keeping a spreadsheet with all expenses and trying to split things so it naturally evened out and it just got to be messy.

We only got a joint checking account. I put half my after taxes income into the joint account, as does my boyfriend (*in theory* – in reality, I have a full time job and the boyfriend has a grad student “living stipend” so his input fluctuates more than mine).

We use the joint account to pay rent, buy household groceries (including liquor/beer, which we both drink, but that was a tricky one because honestly he drinks more copiously than I do), and pay utilities.

The other half of my income is for me to use however I want, and that would include dates and eating out (we usually take turns, and the general protocol is that if you ask the other person if they want to go out to dinner then you are offering to pay).

This works for us because we have very similar spending habits, and although I make more than him it is not a big disparity. What I have honestly liked about it is that it makes it easier for me to pay a more proportional share than when we were trying to split it evenly.

hooles (#6,307)

Registered just to comment on this! My fiance and I just opened a joint checking account since he moved in with me. We calculated how much our monthly rent, grocery bills, and various household expenses would be (e.g., utilities, internet bill, Target trips), and added a little extra to cover a few dinners out a month. We then divided this in half, and we each contribute this amount from our separate checking accounts.

So far it’s working really well for us, though we’ll have to keep an eye on it to see whether we exceed our grocery budget, etc., in the first few months.

Aside from this account, though, we’re keeping our money completely separate. We’re in very different situations – I make about twice what he does, and he has student loans and a bit of credit card debt on top of it – but we’ve discussed it at length and feel we prefer having our independence.

My parents have always kept their money separate, and my mother told me her reasoning for this once. My grandfather was a judge in the 70′s, and was overseeing a wave of pretty nasty divorces. When he was driving my mother to the church for her wedding, he said, “Two things. Always keep your money separate, and make sure your name is on the deed.”

ThatJenn (#916)

@hooles yeah, after getting divorced once I really really really see the independence that disappears when you don’t have any accounts in your own name! Everyone should do what works for them, but no matter how confident I am in my marriage I will never again be without at least some financial stuff in my own name. Just being able to make decisions without permission, on paper, makes a difference, plus it’s nice when I want to surprise him with a gift!

Heckyes (#1,162)

My dude and I use You Need A Budget which has improved our lives tremendously. Basically the premise is that all of the money is in one account and you assign each dollar to a category. So like we have a category for groceries, a category for misc liquor, a category for spending money for each of us, etc. at the beginning of the month we allocate that months income to each category. He used to get mad when I bought, like, nail polish when I didn’t really need it, but now that I have my own spending money (even though it’s all still in the same account), it’s just not a problem anymore. The only issue is that you have to track and categorize every expense, but I think it’s totally worth it.

samburger (#5,489)

@Heckyes I second the YNAB recommendation. My wife and I use it and it’s THE BEST.

ShellB (#5,868)

Before we were married, my husband and I split everything 50/50, which led to a lot of resentment on my part since he makes twice as much money. So I recommend a joint account as soon as you’re living with a partner or sharing major expenses.

Now we do a modified Suze Orman approach. We both put a predetermined amount into a joint checking account every month, about 60% of estimated income. We use that account for all bills, groceries, and things we do together. I will admit to sneaking in personal items into “grocery” or “drug store” bills, but I’m the one who does the shopping, so it’s a finders fee?? Everything left over gets put into a savings account, some stays in cash to dip into for big purchases and some into retirement accounts. I have a pretty broad idea of “joint expenses” though – for example all visits to the prenatal chiropractor are paid from the joint account because this is OUR baby. Picking up a few things from the prepared foods deli is a joint expense because he MIGHT eat some, etc. This is obviously coming from the person making less money. I pay for my student loan, cell phone, and things I can’t turn into a mutual expense from my personal account.

m.m. (#3,026)

We also do a modified Suze Orman approach. Her idea is that the amount of bills you pay should be proportionate to your income. My partner makes twice as much as I do, so he pays more money every month towards the bills, but not a greater percentage of his income. We have a joint savings account and a joint Roth IRA, but keep separate checking accounts and credit cards. We sat down and listed all our monthly bills and split them up so that the amount he pays is almost twice as much–for instance, he pays rent and some dinners out, and I basically pay for everything else (groceries, cell phones, cable/internet, etc) out of our separate checking accounts. Then we both send a portion of our monthly income to the joint checking account. It works pretty well.

shannowhamo (#845)

My husband and I started out with a joint account for rent and bills when we moved in together but still had individual checking accounts we used for everything else. I made more money so we split bills in proportion out incomes. Once we were married I realized that it would be much easier (for us) to just pool all of our money. Our checks go into the joint account and we just pay everything from there. Luckily, I like keeping track of bills and savings and everything and he doesn’t mind deferring to me on what we can and can’t afford. He’s much less of a spender so it works, I’m the one who wants to buy every pretty thing out there.

marykay (#3,102)

My husband and I had different philosophies when it came to splitting expenses. I thought that there should be joint expenses and personal expenses and what we each contribute to the joint expenses should be proportional to our income. He thought that we should share everything and that there was no such thing as a personal expense.

We tracked all our expenses and tried a couple different approaches, the first being what I guess is the Suze Orman approach?

APPROACH 1 – We each paid into the joint account a proportional amount based on our income.

total income 100k=60k(me)+40K(him)
total joint expenses 80k=48k(60%,me)+32k(40%,him)

Problems with this approach:
1. What made it complicated is that our joint expenses were variable from month to month (plane tickets one month for example) and our incomes were variable as well (bonuses, different salary deposit schedules), so we were constantly calculating how much we owed the joint account.

2.It meant that we had different “personal” amounts to spend. In the example above I had 4k more than him to spend on whatever I wanted. I had no problem with this, seemed fair to me, but he pointed out that if either of us ever lost our job, then by this system that person would have no personal spending money.

APPROACH 2 – So in the end the system we use pools all our money from which we we pay our joint expenses, contribute to our savings, gives us each a set personal allowance (the same for each of us), and whatever is left over is “float” that we either roll into the next year, put to savings, or do something fun with.

total income 100k=60k(me)+40K(him)
total joint expenses 80k=50k(62.5%,me)+30k(37.5%,him)

Why this is better for us:
1. Way easier to administrate. Our paycheques are deposited into the Joint chequing account. We automatically transfer the “personal” allowance amounts each month to each of our personal chequing accounts. Done.

2. We each have the same personal allowance so this system is less “fair” since I make more money, but it feels like we are a team, working towards the same goals, on equal footing. That is a really good feeling.

We have a “state of the union” each year where we sit down and go over the previous year’s finances and plan the upcoming year, including what we think is an appropriate amount for personal allowances taking into consideration our savings goals, etc.

marykay (#3,102)

@marykay Ha, my comment was so long and I didn’t actually respond to your question.

At the annual “state of the union” we talk about what counts as a joint expense and what counts as personal. For us, anything we use or do together is joint. Rent, groceries, insurance, utilities, alcohol together, travel together, eating out together, etc. We also thought that any medical bills should be joint.

Things that are personal expenses are clothes, drinking or eating out without the other person, solo trips, sports equipment, solo hobbies or classes, solo gifts given, cell phone bills, transit passes, personal care like haircuts/make-up etc.

Even though we categorize everything and decide ahead of time whether each category is a personal or joint expense, we still ask all the time, “Wait, is this joint?” So, I think you just have to talk about it a lot and figure out what makes sense to you guys as a couple.

(and every month one of us messes up and puts a joint expense on a personal account or vice versa)

@marykay we use this approach too – pool our money first, then give ourselves an allowance. We do set aside “fun money” for things like dinners out or happy hour, but once that’s gone, we have to dip into personal money to pay for “dates.” I get more personal money because I make more and lady stuff is more expensive in general.

Beaks (#3,488)

Before we got married, we basically just used the joint account to move rent money around, and split grocery expenses by having one of us subscribe to a CSA and the other pick up the store stuff (utilities were included, so it was pretty easy). We split costs by % of income.

Now that we’re married, we dump everything in one pot, and then we auto transfer a set (equal) amount of spending money into individual accounts. The joint account covers all joint expenses, and the individual accounts cover individual (discretionary) stuff- eating out without each other, clothes, haircuts, gifts.

In theory this keeps discretionary spending limited to a pre-set amount each month in our individual accounts- in practice we like hanging out with each other a lot and doing things that cost money together, so we still have to put some work into sticking to a budget.

Like marykay, I like the “team” feel I get from this method- we still have some independence, but the bulk of what we do with our money is joint, so it feels like we’re working together towards every goal since things always come out of “our” money.

Beaks (#3,488)

@Beaks Oh, and healthcare is always joint, because we both want to be married to someone who’s healthy (and alive and stuff). That’s how gym costs wound up in the joint expenses, too.

It’s entirely possible 5 years from now the only non-joint expenses will be lattes, candy bars, and gifts to each other.

marykay (#3,102)

@Beaks Haha, yeah, same for us. Every year it seems like we agree more and more expenses are joint instead of personal. I think because the discretionary amounts are equal, it’s easy to feel “generous” with the joint money (while sticking to our budget). Joint money isn’t “my” money or “his” money, so it’s easier to deal with it in a less emotional way, more like a business.

I wouldn’t want a system (like ShellB’s) where you’re hiding personal expenses in joint purchases because you have less and your partner has more.

I do have to say that part of why our system works for us is that we have enough money. We both have jobs, we live within our means but still do fun things, we have savings, we have no debt and no kids. I like to think that if life threw us a curveball, this system would still work, but who knows. Actually, if life threw us a curveball, more importantly, we have gotten really good at talking about money, and we would absolutely be able to come up with a plan to figure it out.

marykay (#3,102)

(accidental triple post!)

clo (#4,196)

My wife and I have been on a joint account since about 6 months after moving in together. We don’t maintain seperate accounts at all. We have various credit cards in one persons name or another, but we’ve added each other as cardholders on the ones we use often. Basically all the money we earn goes into our joint checking and savings and we make financial decisions together. We ask each other or at least let each other know if we’re gonna spend a lot and have the same goals so it’s not really a point of contention. We both want to save, pay down debt, and not spend too much. Our finances are much healthier since we became accountable to each other as we both encourage good habits with each other. So if one person wants to splurge the other might say, ‘sure, you deserve it’ but then again might say ‘you know what things are tight this month we better not’. The only time it is annoying is for gifts so I just put those on my credit card as my wife does not review the statements at all. Sometimes if it’s much higher than expected we may go over any significant purchase together but generally we both spend what we need to and check in about anything out of the ordinary. It’s a good system for us because it forces us to discuss finances often and make sure we are keeping to our mutual goals. Both of us think it would be weird to split things. Maybe it’s because we don’t have much since she is a grad student but we have always been of the mindset that it all comes from the same place. Sometimes she makes more money and sometimes I do, but we both have the same standard of living as each other whether that means we are broke or solvent.

limenotapple (#1,748)

@clo This is what we do, too. I think it helps that we’re both pretty cheap about things, so it’s a system that works for us. If someone wants something expensive, we talk about when the best time to get it would be. It doesn’t come up very often. I guess it also helps that we both agree on what’s important to spend money on, and we give each other slack when we don’t want the same things (if it’s important to my partner, it’s important to me).

ceereelyo (#3,552)

This article is incredible relevant to me and I really like that there are several takes in the article and among the others in the Billfold community – definitely puts a lot of insight into what we are trying to do , which is how to do our money “together”. My husband and I got married last year, but we’ve been living together for about five years. Prior to marriage we just split everything, and opened a joint account about a year or so prior to us getting married. We were at first splitting everything and putting our share into the joint, plus whatever else we have leftover from paying bills/our own personal expenses, etc. Now that we have been married for close to a year, we are more focused on paying down our debt (mostly mine) and saving for a house, I decided (as the one who takes care of all the bills) that we can achieve this faster by pooling all our money together, and budgeting so we can throw more money at our debt.
We are taking a vacation at the end of May, so after this/our first anniversary we won’t have any other big expenses (planned that is!). We make similar amounts of money, but I am getting a raise in May. We still plan to keep some funds in our own accounts – ex: I have a Roth that has been deducting money automatically for the past ten years, so I figure I would keep that. I also agree that we should have some of our own money, and figure that we can come to a percentage but only after we have a good amount of our debt paid off. I am more of the spender between the two of us, and I think since we are pooling our money together, I will hold ourselves and (and we will hold each other) more accountable for our money when it comes to spending.

gridmonte (#5,744)

I actually remember telling my now-husband back when we moved in together and started a joint checking account that I didn’t want him using it to pay for beer! I’m sure he replied that I couldn’t use it for certain items as well. Might as well state the deal-breakers early!

We each deposit a certain amount at the beginning of the month and draw down on it. We gradually figured out an appropriate budget for ourselves over the course of a few months (including fun expenses like dining out), and we constantly check the account and check in with each other so we know what we can spend. It’s never coming from a critical place, rather a mindset that we should both know how our bank account is doing. And once in a while we find that it has room for beer and other bonus items.

Chris_HHH (#6,310)

Question for you guys, since these comments have been super helpful.

I’m getting married soon. I make 75k, she makes 100k. I have about 240k in student loans (on income based repayment).

Would you put loan repayments in the shared account, or not? In the end, we’re both responsible once we’re married … but it’s a matter of whether I should feel broke constantly (which might be a good thing, since I spend more on dumb things like eating out constantly).

People with student loans, what do you do?

hooles (#6,307)

@Chris_HHH Speaking as someone who doesn’t have student loans, but is marrying someone who does – once you’re married, your spouse doesn’t become responsible for your student loans. Your estate can be responsible for the loans, but your spouse herself is not – and this is where the question of joint accounts comes in (as well as putting your name on the deed to a house, a car, etc.). You should talk to her and she how she feels about assisting in paying down your debt. If she’s of the mindset that your debt is shared, then paying the loans from a joint account is great. But she may very well not be.

I have never thought that my partner’s debt would be mine – I’ve offered to lend him the money to pay it off, but he wants to do it on his own, which I respect.

limenotapple (#1,748)

@Chris_HHH I have about $60K in student loans. My husband makes twice as much as I do. Everything we have is combined. So my student loans come out of our combined checking account. It works for us, and he recognizes that he was lucky that his parents could afford to pay for all of his education expenses, and doesn’t want that to make me feel like I never have any money because mine couldn’t. We’ve pretty much agreed to share everything…the income and the bills.

clo (#4,196)

@Chris_HHH Obviously you guys need to discuss but IMO debt is a burden that will follow both of you around so might as well pool things and work together to pay them off. But I’m the same as @limenotapple – we pool all money and all bills. We don’t split costs or accounts for things seperately at all – everything is joined (see my comment above).

faceifer (#3,162)

@Chris_HHH My boyfriend and I have a joint checking account that is primarily for utilities and groceries. We also transfer in and out to facilitate paying each other back (like if I put a vacation on my credit card, or when I owe him for half the mortgage payment). There’s usually only a couple hundred dollars in the account at at time. The rest of our incomes and expenses are separate.

I have student loans and he does not. Right now since we’re not married, I am paying them back on my own. We haven’t explicitly discussed what we’d do about them assuming we do get married someday. My best guess is that he’d want to contribute at least some of his income to them, since the sooner they’re paid off, the better for us as a couple. However, I’ve had my degree since before I met him. I knew what I was getting into when I took out the loans on my own, and it wasn’t a decision he was involved in. Because of that, I personally would be okay with keeping the loans as my own expense if he was unwilling to help me pay them off. I think in the end this is the kind of thing that very much depends on the couple and the circumstances under which you took on the debt. Hope that makes sense!

NB (#1,594)

@Chris_HHH I started out with $100k in student loans, he has none. We had a looong talk about that before we got engaged, and have revisited several times since then. We pay all ‘our’ [my] student loans out of a joint account, and have since we moved in together. I was pretty set on the idea that this was my debt, I planned on taking it on before we got together, and I had a plan for paying it off that didn’t involve him. His take on it was that the loans were an investment that we both benefit off of now, and money paid for loans/loan interest is money we can’t use to make other investments together (like a house).

Some context that is helpful: Now I make more than he does, but when we moved in together, it was after a long cross-country move, and I was $20-in-my-checking-account broke. So, our shared moving expenses went on a credit card (mine), and were paid off by him until my job started 2 months later. In fact, all our shared expenses were paid by him till I started drawing a paycheck again, at which point we just combined our finances entirely. This was something he initiated—we knew we planned on combined finances, so any unnecessary shared debt (like credit cards) felt like a waste to him. Now, although we deposit our paychecks in separate accounts, our finances are 100% shared. We set a price point above which we would not make a purchase without consulting each other—and above that price point, we give each other a pretty strong veto vote if it seems like a really bad idea. Mercifully, my student loans didn’t go into repayment until I was already drawing a paycheck, and we were engaged. At first, I paid them directly out of my own accounts, but because we shared all our other expenses, the difference was largely academic. Now everything comes out of a shared account.

Finally, we set some key financial goals (pay off student loans/save for house/save for retirement/save for wedding/donate $x to charity) that we track regularly. We are obsessive Mint users, which lends a lot of transparency. We still need some check-ins about where our spending priorities are, and we both had some initial resentment at first, but now it’s blended enough that everything feels like “our” money, and some of that has worn off.

I make $110k/year, he makes about $60k, and we initially had some uneasiness about who was “pulling their weight.” Blending our finances entirely has (in the long run) made us both more comfortable with the idea of everything being “ours” (we also live in a community property state, and don’t have a pre-nup, so). As we get ready to have a kid, or DIY home repairs, it’s also alleviated a lot of my anxiety about how we value (or don’t! Boo!) the unpaid labor of running a household—it feels very “we’re all in this together.”

…which is a very long way of saying “We pay my loans out of our shared account.”

Beaks (#3,488)

@Chris_HHH He had paid his loans off before we got married, and we paid mine off jointly as quickly as possible after we got married. Basically, we’re planning an entire future together that involves not only the debt we started with, but house buying, travel, retirement- so paying off debt as quickly as possible let us get to those things faster.

WriteBikeBobbi (#3,938)

My husband and I have one checking account and one savings account. Both our paychecks go into the checking account. We are each paid once a month. I have a color-coded, categorized spreadsheet (categories are mortgage and utilities, savings and retirement, loan repayment, transportation, groceries and home-keeping, entertainment) that I fill out and discuss with him, and we agree on all payments and allocations and also discuss upcoming expenses or “wants.” Then I move money around / pay everything. Boom. Done for the month. We do each have individual IRAs, but other than that, it’s shared and it works well for us. This is due in part to the fact that he wants and trusts me to deal with the finances, and I’m the type that needs to check our daily balances, etc., while he prefers to be hands-off. We stick to the plan, and while he earns a very good living, we don’t spend more than $40 or so on any personal / fun item without checking first – what the spreadsheet shows for the month, whether we have extra, etc. It worked when we were broke together and it works now, when we don’t have to wonder if we have enough grocery money for the month.

yellowshoes (#4,954)

Aha, I just had this conversation and went through the account-opening-process with my boyfriend within the past few months! Sounds like my motivations were similar to a lot of people here–we’d been living together for 2.5 years (dating for 4), and we split stuff through an incredibly tedious process where we’d sit down once a month and literally go line-by-line through grocery receipts, utility bills, vacation receipts, etc. and tally up items one of us exclusively used, items we both used together, and then add every item up and write each other checks to balance our contributions. IT SUCKED and I finally brought up a joint account (in addition to us both keeping all our own accounts) and we’re working through it now.

We opened a shared credit card (in my name; he’s added as a user) and a shared checking, and we pay the cc from the checking. It’s only for items that we both use or participate in: Groceries, meals out together, events together, etc. Right now we balance it from purchase to purchase, meaning, “My fancy yogurts are $10 and your weird cereals are $10, so that’s even” but NOT “My new gym pants were $30 and your beers with friends were $30 so we’re square”.

I think an important question to ask, and one we wrestled with, is: How combined do you want your finances to be, and why? If you eventually want every penny to be combined, you’ll have to decide how much you want to police the other’s spending. If you want to keep your separate accounts as well, you need to agree on what counts as “Shared” and what counts as “Individual.” To me, it’s clear: “Individual” is something only you experience or use; “Shared” is something you experience or use together.

For me, my boyfriend was actually kind of hurt when I said I never wanted to fully combine our finances (that’s my adult-child-of-divorce talking), and we talked about it; I learned that he really didn’t want to pay for apartment decorating stuff that only I wanted, and that’s still an ongoing conversation (hah) but in the meantime I’m not buying anything superficial-house-related from the joint account. Those were all important things to learn about each other.

Another part of the conversation: Do you want to use a joint credit card, and potentially earn miles or points on that, or do you want to stick with checking only? We went for credit card because I don’t give a flip about rewards points, but my boyfriend is all over them.

Another thing we did: Ponied up $5 for a trial to MyFICO and checked each other’s credit scores. It felt kinda icky but we are both really glad we did it. Good to know for sure!

tussock (#1,296)

My partner and I also have joint accounts plus our own separate accounts. We have a budget that reflects what the joint money is supposed to cover (mortgage, utilities, food…) and contribute to the joint account based on that. The list of what’s joint and what’s separate has definitely evolved over time… we realized, for example, that we liked being able to use the joint card to pay for casual meals or coffee out together, so we added that in. Other things (clothing, hobbies) are solidly in the non-joint category. As always in relationships, I think the keys are communication, flexibility, and goodwill.

We fully combined our finances when we got married. My husband is not good at managing money, but he wants us to be smart. I like taking charge of our finances and working toward big goals as well as making it possible for us to afford the month-to-month stuff. He had a lot of credit card debt that he took care of before we got married. I was shocked at how ignorant he was about interest rates and where his money was going – especially because his parents are financial geniuses and mine are the absolute worst! We talk about money a lot and we discuss big purchases and goals so that we are on the same page. It works for us.

When our son turned 2 and we had to start thinking about three plane tickets to visit family, I got us an excellent rewards credit card. We charge everything and pay it off in full every month. This has been a great method for us. We know how much we are spending. We know when we need to back off, and we are making our money do more for us. We got four free plane tickets last year spending money we would have spent anyway.

Obviously, since I am obsessed with this site, I am always looking for new & better ways for us to learn to save and be better about actually budgeting. We are about to have our second child and our monthly daycare bill is going to be INSANE, but so far, we have managed to make everything work through open communication and trust.

potatopotato (#5,255)

@xtinamartinson: Isn’t it a pretty big gut-punch/sad day for your checking account when you pay off a whole month’s expenses at once? Or do you make cc payments multiple times per cycle?

@potatopotato I do it in two payments. It’s not as big a gut punch as daycare, thankfully.

morecakeplease (#6,311)

Before we were married, we kept separate accounts and my husband paid me “rent” each month toward our joint expenses (housing, utilities, etc.) and then I took care of paying the bills. Food was paid for by whoever could afford it at any given time. The interesting side of that was he suddenly couldn’t afford to pay for meals when he was secretly saving for an engagement ring, which was annoying at the time but was obviously ok in the long run.

After marriage, we combined our finances, which means I can see everything he buys and he can see everything I buy. It’s impossible to surprise each other on holidays unless we withdraw cash to pay for a gift (which is fine because I am terrible at keeping secrets and usually hand over the gift long before the occasion, and typically before he even checks the bank statement).

We don’t fret over personal expenses…the general thought is “if you need it, just buy it.” For non-needs, we try to keep it even. For instance, I spent several hundred dollars on a new sofa I wanted, so later in the year I didn’t complain when he purchased new hiking gear.

@fo (#839)

@morecakeplease “For instance, I spent several hundred dollars on a new sofa I wanted, so later in the year I didn’t complain when he purchased new hiking gear.”

I assume you don’t let him or his friends sit on the couch?

morecakeplease (#6,311)

@@fo It’s a pretty durable couch.

@fo (#839)

@morecakeplease Of course, I was joking, but that then means it’s his couch, too, doesn’t it?

Is it of a design that he finds 110% distasteful, at least? Or is it your 5th couch in the house (we had that problem once), or something else?

cuz otherwise it seems out of balance to me (not that I care *at all* about that sort of tit4tat in my own relationship, much less yours).

goldenhandcuffs (#2,286)

I make significantly more than my husband so our process is more streamlined. He also has student loans whereas I am debt free (but he is working on them!) He is on my credit cards, and we have a joint account where we each contribute a relatively nominal amount. He uses his income to pay his student loans and for his personal expenses. I pay for pretty much everything else, including joint housing expenses, but the house is titled in my name. The disparity is just too great for us to really get into an item-by-item discussion of what is joint vs. split. IF our income balance shifted, we would have to reevaluate.

frenz.lo (#455)

My spouse and I do this: automatic payments of a set dollar amount per week to a savings account. Joint credit card for most bills, paid out of savings account once a month. I contribute cash for most physical purchases due to sometimes receiving cash tips. He pays a specific bill every month. All groceries, booze, medical bills are shared. Random home purchases tend to be shared. Personal clothing and fun stuff, usually separate, unless we’re shopping together and it’s easier to ring up one pile of stuff. Works for us, somewhat.

Sorbee (#2,256)

By the time we got engaged, my husband was already in law school and I was the sole breadwinner, so we fell into the merge everything model almost by default and have continued this in the years since he graduated. Honestly, though, one of the many reasons we’re a good match is that we’re on the same page in regards to spending. We also have a budget with indulgences built-in, so neither one of us feels obliged to justify anything we buy.

Any way you decide to go, separate accounts or not, you should probably have open communication about money. Sure, people get emotional when it comes to the subject, but I think many fights could probably be avoided by establishing clear expectations of one another. For example, a coworker and his wife check in anytime they want to buy something more than 50 bucks. I like that approach a lot.

dilworth (#6,313)

From a Smug Married 10 of years: just take the plunge and merge everything. So much easier and pretty soon you will forget the whole mine / yours thing. Maybe this comes with time, or maybe this only works for us because my wife is a SAHM but after years of trying basically all of the above we find this to be easiest.

We use Mint to track expenses carefully and also have an airtight budget which we just reviewed for the year (my wife is an Excel fiend). We have a line in the budget for everyting and plan for big expenses (mostly travel) We also have weekly budget meetings (on Saturday night no less!) to keep ourselves on track. We really cracked down about 6 months after our second child was born because we found ourselves spending money on all kinds of stupid nonsense. So now everything goes into checking, our bills, mortgage etc get paid out of that. We transfer to a joint savings as well. And for long term / retirement that’s all held jointly by law. The only exception is I have an investment account I inherited that has become our rainy day fund. It’s in my name and I basically control it but from a legal standpoint it’s 50/50. And I’ve saved the best for last: we each get a very generous weekly allowance for personal expenses: $20! Which is a bit tough but after the crackdown we really needed to do something.

Now we are (usually) in the black and on track with our budget and manage to have a little left over. And my wife does all the work because basically you don’t want me handling money. I’ve never even balanced a checkbook. I’m not even sure what balancing a checkbook means.

tussock (#1,296)

@dilworth From a Smug Married with a twenty-year relationship: I disagree! Separate accounts provide some space and autonomy in ways that are good, emotionally, for a relationship. And separate accounts also provide some protection in case the relationship sours. The investment account, for example, might be “legally” equally your wife’s, but ultimately you could secretly blow it in Vegas and she couldn’t, and that’s an important distinction. (Obviously, I mean, couples should do what works for them. But I still vote for separate accounts.)

@fo (#839)

@tussock From a Smug Married with a (almost) twenty-year relationship: I disagree *with you*!

Can’t imagine having separate accounts. We each still have a credit card or two on which the other is not a co-holder, but I handle payment of *everything*. And she makes a lot more than I do.

potatopotato (#5,255)

Ok, I have some questions about this. I currently live with my boyfriend, who makes over twice what I do. He pays the rent and the internet, I pay the gas and electric and buy a lot of the food, because I enjoy it and happen to work next to a grocery store. We never fight about money because we’re both just happy that everything gets paid, and we’re both very generous with each other (him especially, because, well, he has more to share).

We’re looking at buying a house from a family member who recently moved into assisted living. Rather, I’m looking to buy it — and if anybody cosigns, it’ll be my parents — and he’ll live with me and help pay for living expenses. I do NOT want to sign a 30yr mortgage with him because we’re not married. So now I’m in this weird place where I’ll be building equity, because it’s my house, but he still makes a lot more than I do, so I’m not entirely sure how to split the expenses in a way that is fair.

Thoughts on that, anyone?

Allison (#4,509)

@potatopotato does he care about the equity thing? who’s putting up most of the downpayment? and how does the mortgage payment compare to rent now? (and what’s your plan on how you’ll pay it if you break up? roommates? this feels some how extra nosey, sorry these are just the things I’d be considering).

It’s unlikely that he’d have the in on this house if not for you, so it makes some sense to me that it’d be in your name. And if you do end up married or a civil equivalent, his name can be added at a later date.

@fo (#839)

@potatopotato “Thoughts on that, anyone?”

As Allison asked “how does the mortgage payment compare to rent now?”

But I’d drill down more–how does the *interest* on the mortgage compare to the rent? If that’s less than rent–and you can afford the principal portion of the payment + insurance and taxes–then that would seem pretty “fair”–you’re paying 1005 of the ‘equity’ and he’s paying less than he was before for a (presumably) nicer place.

One ‘troubling’ aspect is that you would still get 100% of the tax deduction, so you’d want to hash that out in advance, for ‘fairness’.

But, that’s 100% a feel thing, so I dunno that ‘fairness’ is the most important part. Do know that–at best–it would be a giant pain to have him added to the mortgage if you do get married. Obv you could refi the loan, but there’s a good chance that rates would be higher in the future.

potatopotato (#5,255)

@Allison: No, I don’t think equity is a big deal to him. I moved in with him sooner than we planned because I was laid off suddenly, and in the coming months we actually got into an ugly argument where I insisted on paying some bills by myself because I need to contribute, and his ego and want to take care of me and not wanting to accept my money was getting in the way of that. So I guess my concern is that now it’s, “Oh, well it’s your house, so set it up however you want, I’ll just live there,” when I want it to be OUR home, not just mine. (His apartment felt like HIS apartment at first, but he did a good job of offering the space to me freely, and it doesn’t feel that way anymore. Hopefully that can happen here, too.)

The downpayment will mostly come from my savings and some help from my parents (it’s the house my mom grew up in, and they’re forwarding money I would inherit anyway to keep in in the family). Boyfriend has made it clear that he wants to contribute a good chunk to it, though.

We have a *really* good deal on rent right now, because we know our landlords, but it’s a 1br that’s tight for two people, and we both could use more breathing room. We’ve run some projections on what the mortgage will be, and it should be about the same or maybe a little less, but the utilities will be more, because 1) whole house = more utilities used and 2) nothing included in the rent. We haven’t completely run the numbers out yet.

If, god forbid, we break up, I don’t want the house to be a thing I can lose in the split. Ideally I’d get a roommate, or get a second job, but my parents could help pay if it really came down to it. (I don’t want it to ever, ever come to that.) I’m also hoping the final numbers will turn out to be something that I could pay alone if I really, really had to and went back to spending very, very carefully like I did right out of college.

potatopotato (#5,255)

@@fo: The interest rates we’re looking at are around 5%, but the value of the house vs. how much the family’s actually going to ask for it hasn’t been hammered out entirely yet. (There are 4 siblings who ultimately will inherit the cost of the house, but one of those is my parent, so am I paying her now for her chunk when she’s helping me with the downpayment with what she sees as my early inheritance anyway?)

I hadn’t considered the tax break part, thanks for pointing that out. I could reinvest that back into shared expenses, or shared things that we enjoy, so we both benefit from it.

My assumption was that if we got married, it would become shared property, but that probably varies by state, right?

@fo (#839)

@potatopotato “My assumption was that if we got married, it would become shared property, but that probably varies by state, right?”

Depends on the state, yes, but even where it technically becomes considered to be joint property, it doesn’t *automatically* become titled to both of you, and the Lender doesn’t *automatically* add spouse to the note and mortgage as a borrower. So, if the bank foreclosed, you’d be the only defendant, and if you wanted to sell “without his permission” you could.

Based on your early estimates about the mortgage (and not to hammer it, BUT–make sure you are including taxes and the (much higher than renter’s) insurance costs in that, too), I like the “he pays the interest” idea pretty well, at least as a discussion starting point. It’ll be a lot less than rent, and it will get less every month, but he isn’t “building your equity” (even tho $$ are all fungible, so, really he is, but: Optics).

potatopotato (#5,255)

@@fo: Taxes are around $3k/year. I work in insurance and my coworker is working on a HO quote. I’m considering the wisdom of escrowing all that into the mortgage payment for convenience and simplifying the budget, vs. just opening an account where we can just “pay” the monthly amount into it and at least earn the interest on it ourselves.

We don’t have any shared accounts, but I’m wondering if the solution here is to open a shared savings and/or checking account and saying, “Your contribution each month is X, mine is Y, we’ll put it all in this account and use it to pay mortgage, taxes, insurance and utilities.” But maybe not all of those things because the insurance really only protects me, not him? And maybe not taxes, because if it’s my house they’re my problem? And maybe none of this because the amount can change every month and we don’t have enough data to accurately estimate how much utilites will average per month? So maybe I just pay mortgage/insurance/taxes and he pays utilities, which is the swap of our current arrangement. UGH MONEY.

We also were talking about this again last night because the appraisal for the house came in at $155K, and so we can run some mortgage calculators and I was saying that the biggest factor in the can-we-afford-this arena is how much we put down. He’s decided that he really needs to think about this more seriously, because he’s generally very generous with his money (and as previously mentioned he really wanted to contribute to that), but he knows that if he plunks down money for the down payment and I boot him out, he’s fucked. Which, you know, would be true. And I have to make sure that it’s an affordable enough monthly amount that should he bounce with no warning, I’m not the one who’s fucked. It’s one thing to have my folks help with a down payment, but I never want to have to ask them for regular monthly living expenses.

(Thank you for your insight. I’m simultaneously brain dumping and legit trying to figure this out.)

potatopotato (#5,255)

@potatopotato: I also want to push him to get renter’s, which I currently have and he does not, and I would need more life insurance once I own a house, in case I kick the bucket before it’s paid off. More added costs. This whole thing may work out in the end, but in the meantime it’s keeping me up at night.

@fo (#839)

@potatopotato More thoughts:

“I would need more life insurance once I own a house, in case I kick the bucket before it’s paid off”

Who you trying to leave money to? Don’t need life insurance unless you’re trying to protect someone who doesn’t die with you.

“Your contribution each month is X, mine is Y, we’ll put it all in this account and use it to pay mortgage, taxes, insurance and utilities.”

This makes sense. Yes, utilities will vary, but you fine tune it over a period.

“the insurance really only protects me, not him?”

Protects his stuff, if its in the house. I mean, it just all becomes ‘yours’ if a claim is filed.

“maybe not taxes, because if it’s my house”

Taxes are indirectly a part of rent on an apartment, too, so it’s not like he avoids real estate taxes by renting.

“if he plunks down money for the down payment and I boot him out, he’s fucked.”

Can give a note. Can give a second mortgage. All sorts of ways to memorialize his contribution so that if you two dump each other, he can get his $$ back without you losing the house. Yes: annoying, overly-formal, possibly fraught. But you *can* document it as a business transaction. (I could never do it, personally, so don’t recoil and think that you’re being weird–it’s, imo, weird to do that)

“So maybe I just pay mortgage/insurance/taxes and he pays utilities, which is the swap of our current arrangement.”

Meh, I think that, so long he is comfortable with it, you ask that he contribute something similar to the rent + internet he currently pays (maybe 90%, maybe 80%, I dunno) and then you agree to pick up the other utilities (don’t forget about water, which can be expensive depending upon where you are) and whatever is left of mortgage+taxes+insurance+utilities. And you ask that he be prepared for the added maintenance efforts that come with a house (hopefully he’s prepared to help with yardwork, etc).

CJSinner (#6,322)

My husband and I got married almost two years ago and until TODAY (!) we had a joint account that we set up right before the wedding and I kept my personal account with the same bank. His checks were deposited into the joint account and mine were deposited into mine, I paid most of our bills out of mine, and he paid most of his bills out of the joint. But I had access to all the accounts and he just had access to the joint. It worked for a while, but I started to feel like I was weirdly keeping my finances a secret from him or something (even though I wasn’t) and that he wasn’t getting the full picture of our finances by only seeing his half. (He’s not that great with planning and paying bills on time and stuff, so I do most of the money management)

SO TODAY, I changed my direct deposit to put 95% of my paycheck into the joint account and keeping 5% in mine just in case there are auto payments I’m forgetting about. So now we’ll be working from just one pot of money. This feels so much easier.

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