I get asked this a lot, and I have to admit it feels like a trick question. Couples want to know if they should combine their money when they get married, keep it separate, or do a hybrid of both. From my perspective, I don’t think there’s one right way to do it. The most important thing is that you and your partner are on the same page in terms of how you want to handle money. Many engaged people I’ve talked to assume they will be either combining their money or keeping it separate, but they’ve never had a conscientious conversation with their partner about it. So what do I tell couples who ask?
I think the best universal answer to this question I can give is to know there’s no one right answer so it’s best to survey the options. There are lots of ways to make this work and lots of happy couples across the spectrum. You don’t just have to default to what your parents did. There are couples who keep their money almost entirely separate, splitting the bills equitably between their incomes. There are couples who share everything. And, there are couples who develop some sort of hybrid – having some money held together and some money held separately.
When we got married, I had the mindset “what’s yours is mine, and what’s mine is yours,” and in many ways I’ve kept that mindset. I believed that when we got married we would share our income, our expenses, and even our debt. It would be one pot of money shared between the two of us. This worked out well for a little while, but I found that my husband wanted some money that he had more jurisdiction over.
As I’ve shared before, spending comes more easily for my husband than it does to me. I’d lived frugally for years and I was happy with my lifestyle. Even when we had more discretionary income, I was really reluctant to spend it. I unintentionally put my husband in a situation of needing to ask me every time he spent money and, in turn, unintentionally made him feel guilty about it. He wanted some money that he could spend, without talking to me about it, on anything he wanted.
After he expressed this concern, I harkened back to my conversations with my first financial coach years earlier. Her husband, like me, kept a close eye on their budget and she wanted to have money that she could spend on her own, free of judgement. She called this her “don’t ask, don’t tell money.” She had a small stream of income from doing side work speaking and writing she used to fund this separate account. This money never even appeared in their budget. Her husband didn’t know how much came in or how much was going out – it was hers to manage as she wished.
My husband didn’t have any side work money to draw from, so we decided to set up a “Tyler fund” within our bank account. Every month we put a set amount of money out of our regular budget into this account, and when he received birthday money or raises at work a portion was put into this account as well. Over the years, he’s used this money to invest in hobbies like video games, a new harmonica, and even funding part of his new computer. We try to be very careful to only use this fund for purchases that we wouldn’t normally make out of our budget. He shouldn’t have to be penalized by having to use the Tyler fund for regular purchases like an occasional coffee from Caribou, purchases for both of us like a board game, or purchases we’ve decided on in advance like a new tablet. We’ve struggled to navigate the exact boundary line between the Tyler fund and our regular budget, but through intentional conversations about individual purchases I think we are getting there.
While we started out with a 100% combined budget, we now take a little more of a hybrid approach. It’s served us well so far. That’s the other thing I say to couples: It’s ok to change your views. If your current system isn’t serving you, make a change. You can always try a new system for a short period of time and see how you like it. The most important thing is that you decide together and pivot together. Yes, that means you have to talk about money together – but it’s well worth the effort.
Trying to decide how you want to manage your money as a couple, or considering a course-correction? Here are some questions to discuss with your partner:
· How important is it to you that you see where each and every dollar of your income goes?
· Do you want to have money you can spend, share, and/or save on your own without consulting your partner?
· What are you interested in sharing with your partner – your monthly expenses, your income, your savings, and/or your debt? Is there anything you don’t plan to share with your partner?
· If you don’t share your income, how will you make sure your joint expenses are shared equitably?
A word of caution: It’s easy for one partner to dominate this conversation – generally it’s the person who has more control over the finances. Do your best to level the playing field and create a safe space where both partners can express their needs, desires, and preferences.
Don’t be surprised if you have different needs and desires on this subject. If you find one partner needs a little more independence, now is a good time to identify the curbs and gutters. Is there a certain amount – $50, $100, $200 – that can be spent without consulting your partner? Do both partners want this flexibility, or just one? Do they want a specific pool of money to draw from? Be as clear as possible. You can always test drive this new system for a while and see how it works.
Remember, there are many happy couples at all ends of the money sharing spectrum. The most important thing is to listen to your partner and yourself and find a solution that works for you both.
Where do you and your partner fall on the money sharing spectrum? Leave a comment below