What are you and FI/DH doing about your finances?

[chiquita8302]

We combined our accounts once we knew we were staying together for the long run, once I got sick of the "you pay for this, I'll pay for this" kind of stuff... plus I wanted to attack whatever debt we had in the most efficient way possible. He closed out all of his accounts and put all his money in mine, and we added his name to all my accounts. We have one main checking account that I pay all the bills out of, and I transfer whatever I can whenever I can into a savings account for emergencies/the future. I manage the checking account, and keep him up to date if he has to watch his spending a little extra close, or if there's a little extra cushion from his overtime for him to splurge on something he's had his eye on for a while! Generally, if he's going to spend more than a hundred bucks on something he just checks with me first (since even if he knew the account balance he wouldn't know what bills i've paid or what bills are upcoming). He's curbed his unecessary spending drastically and is looking forward to the day that I finally give him the purchase order approval for the boat he's always wanted!

 

Originally Posted by BBtoB 

I was surprised I didn't see a thread on this topic...but could have been a user error.

If you are already married, did you and DH combine your finances in a joint account? Or keep them separate?

If engaged, what are your plans once you are married or currently if already living together?

I would love to hear your feedback on your stance and what most people are doing these days.

We will be combining our incomes. Still talking this one over.It is such a pain transfering money back and forth. I will be so excited to get our joint account so I don't have to transfer money all the time.

[inloveinkorea]

We got engaged the day we moved in together. A couple of days later, we opened a joint account and all of our income gets direct deposited into that. We still maintain individual accounts, but those are mostly for paying bills that have accounts tethered to them. It was REALLY strange at first when we first had a joint account, but 8 months later, I'm used to it and we have a good system.  

[Jessica Correa]

we joined expenses but I cannot get accustomed to it. Having some issues there at the moment but we just joined accounts maybe a month or a month and a half ago. any tips on how to not lose your sanity???

[Jenny2014]

Originally Posted by Jessica Correa 

 

we joined expenses but I cannot get accustomed to it. Having some issues there at the moment but we just joined accounts maybe a month or a month and a half ago. any tips on how to not lose your sanity???

 

Hi Jess,

 

FI and I have had our accounts joined for quite a few years now. Do you live together, share bills, etc?

 

What aren't you accustomed to?

 

We lived together for a couple of years during university without having our accounts joined, and it was growing frustrating always having to check who had more money when we wanted to do something. So finally we joined our accounts. For a few years we just had the one account between the two of us, paying our bills out of it, etc. Then in December of 2012, we opened a second account (mostly because we were having a car payment come out on a certain date, as well as insurance). Now, every time we get paid, I transfer over money to that account to pay all of our bills. I also transfer over our agreed amount to his tax-free savings account that we are using for our wedding/ savings for the future. Eventually I will open my own, and put money into both. That way, everything gets paid on time, and we know the amount that is left is grocery/gas/fun money. We have found it makes it easier on us to not have to worry about overspending when we know bills are coming out. If one of us needs to make a bigger purchase, we check in with each other to make sure it is okay. He is really good with this, me not so much. I think because I manage the money, I kind of just see it, and know what's there, what still needs to be spent, and know we can afford for me to spend such and such on this item. But it doesn't seem to bug him, so.... we've managed to make it work!

 

It can be a bit frustrating, especially if he spends more money than you do on a monthly basis, but we have always seem it as "our" money, not mine/his money. One of you needs to take the lead on managing the bills/savings, because if you both try to do it, you manage to step on each other, and get into more fights. Not to say we don't have fights about money- we definitely do, but it's much easier when one person has a definite track on what the monthly spending is. We both have complete visibility in our accounts- know each others passwords, so there are no secrets.

 

I hope some of this helps a little bit!

[gresley]

Originally Posted by Jessica Correa 

 

we joined expenses but I cannot get accustomed to it. Having some issues there at the moment but we just joined accounts maybe a month or a month and a half ago. any tips on how to not lose your sanity???

 

We solved this issue for the most part by having partially joined accounts. We have 1 joint credit card, 1 personal credit card, 1 joint checking+savings, and 1 personal checking/savings. 80% of each of our paychecks goes into the shared bank account. Then we each have our own set of bank accounts that the other 20% goes into (+ whatever money we had before we were together). We pay bills + shared expenses (things for the house, medical expenses, etc) out of the shared account. Personal expenses are paid for out of our individual account. 

 

This means we don't have fewer about the other person buying things. In other words, I don't care if he spends $100 a week on drinks after work, or has a latte addiction, or only wears italian leather shoes, because their his things paid for by his money. (Note, he doesn't actually do any of those things, lol).

 

There are some keys to making this work --

 

1. Decide on a percentage you both contribute, not a dollar amount. We calculated our (very general) budget of rent + expenses + savings, and then determined a $ amount that we had to have each month, and just made sure that X% of both our incomes hit that amount. 80% ended up being more than enough, but we don't have that many personal expenses anyway, so we decided not to make it lower. The key to having percentages is that it's fair even if you're making different incomes, so one person doesn't feel like they're spending "all their money" on joint expenses.

 

2. Direct deposit. We had the issue where my FI didn't set up direct deposit for several months when he started a new job, and kept forgetting to deposit his checks. I kept having to take money out of savings and freaking out, and eventually he transfered like 6 months of back-pay in all at once, so our finances were all over the place. 

 

3. Clear boundaries on what's personal and what's not.  Some things are obvious. If I'm going out to lunch with coworkers (obviously without him), its my expense. Clothes, salon visits, all personal. If he's buying games to play on his computer, it's obviously his expense. There were somethings we had to decide as they came up. For instance, we decided after the fact that medical expenses would be shared. I ended up getting really sick a couple months after, so it was good that we had decided on that before the medical bills started piling up.

 

We still struggle with this sometimes, but for the most part it's a good system. Yes, sometimes there's a grey area. For instance, we both play video games. If he buys a 1-player game, but I want to play it too, is it personal, or joint? I started taking classes at the local CC, and I paid for them personally (since he's not in the class), but he said that could have been a joint expense, and he wouldn't have cared. The most frequent thing is that I can never finish a meal at a restaurant (seriously, those portions sizes are way too big), and I always pay for them personally, but he sometimes eats my leftovers. I don't want to say "I paid for that myself, so you now owe me $4 for that half of burrito". For the most part, I don't sweat the small things, because we buy each other meals / gifts all the time, and at the end of the day, it's not a big deal. 

 

We adapted this system from what we read in personal finance books. My two favorites (but very different books) are "Smart Couples Finish Rich" and "Young, Fabulous, and BROKE"

[gresley]

Oh, also, this system sort of falls apart if/when one of you isn't working (for kids / economy / whatever reason).

 

In that case, we agreed that the non-working person would still get "paid" out of the single income. As an example, let's say that you quit your job, and you're living off only your DH's income. You determine you need 60% of his income for joint expenses. Of the other 40%, he takes 20% and you take 20%. You set up an automatic transfer from joint to your personal acct, so it doesn't feel like he's giving you an "allowance". You're both contributing to the relationship even if one of you isn't working, and so you need to have some money for personal spending as well.

 

As with all money things, the most important thing is to talk about expectations with your partner and come to agreements and compromises

[gresley]

Originally Posted by gresley 

 

This means we don't have fewer about the other person buying things. In other words, I don't care if he spends $100 a week on drinks after work, or has a latte addiction, or only wears italian leather shoes, because their his things paid for by his money. (Note, he doesn't actually do any of those things, lol).

 

Should have read it over first.. We don't have FIGHTS about the other person buying things we don't approve of.

[gresley]

Oh, also to note, we did this when we first moved in together, and we're not married yet. We're basically "married", though, and most of our expenses are shared.

[Jessica Correa]

Thank you all for your kind words and suggestions. I think I try will do the percentage from the account that way we still have some kind of financial freedom. I think we all need a little bit of that