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Combining finances

112 points by dontmitch 7y ago

skrebbel 7y ago
This is what my SO and me have been doing for 8 ish years now and it's great. We call it "pocket money". I can't complain when she spends it all on shoes and bags, she can't complain when I spend it all on beer and hamburgers. When we were poor, we both only got a little pocket money each month. Now that we're richer, we both get more. I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my home town. It's terribly decadent but hey, it's my money. Other people buy iPhones. I have nobody to answer to but me. It's lovely. I warmly recommend pocket money.
- duxup 7y ago
  >I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my home town. Where do you find the time to clean all your monocles?
  - skrebbel 7y ago
    I usually ask the maid to do it.
    - kevin_thibedeau 7y ago
      You need to upgrade to a valet.
- lupire 7y ago
  What happens if you spend your pocket money on end-of-life care, and then your SO wants some too?
  - loco5niner 7y ago
    End-of-life care has nothing to do with pocket money.
- blts 7y ago
  Does it lead to overspending? Since you have your pocket money - then you need to spend it?
  - Cerium 7y ago
    My wife and I use the same system, and I would say no. We both tend to save ours and then spend more some months than others.
  - shostack 7y ago
    If budgeted for properly, this should in their reduce overspending because the amount you can freely spend is one you've previously accounted for as "an appropriate amount."
  - skrebbel 7y ago
    I think I get too little of it for that :-)
duxup 7y ago
I see lots of choices out there, and different things work for different people... and sometimes things evolve, and like relationships the finances should / will too, even when you don't want them to. It became clear that when my wife went back to school we couldn't sit and do math or rearrange everything all the time. We just put it altogether. Nothing is easier when married than just putting it into one pot and it is all "our" money. It's not about who does what (maybe one day someone does more dishes, makes more money) and it's all "ours". But even than if you have a couple with very different spending and someone is more responsible, I don't think it is bad to establish an "allowance" for everyone for as the article describes "splurges". The important thing is to always be communicating about it.
challenger22 7y ago
I would be very frustrated if I explicity had less fun money than my spouse.
- blairbeckwith 7y ago
  That is exactly the opposite of what the article suggests. > Both partners have equal access to it, and both partners will continue to receive the same monthly allocation for fun money no matter how much each person makes.
- MereInterest 7y ago
  It definitely depends on the couple. Currently, I am working and my spouse is not. During our most recent talk about budgeting a few months ago, we took this into account when figuring out appropriate amounts of fun money for each of us. Specifically, since I am out of the office/house for lunch/dinner less often, and my hobbies (programming/baking) are inexpensive, I neither need nor want as much fun money, and I would rather they have it available instead.
StavrosK 7y ago
What if one spouse makes seven figures and the other is unemployed and takes care of the household? The income disparity then is too high for this, it seems to me, but maybe it's just me.
- toast0 7y ago
  My spouse and I have a simple plan. I make the money, and my spouse spends it. :) When money was tighter, we would coordinate more closely and more frequently about expenses and timing. Now I just maintain a certain balance in checking and we coordinate over large payments to make sure they don't hit checking all at once. If you or your spouse is making seven figures, you shouldn't have actual money problems -- even if taxes take half, you can save half and still have 250k/year to spend; spend half of that on a $5M mortgage, and you've still got more spending money than US median income. Your money management priorities should be around limiting the time it takes to manage, unless you get enjoyment out of micro managing it.
  - cm2012 7y ago
    My relationship is the same. I make a lot of money, and there's not much I want. I get a lot of joy out of watching my wife get things she wants though (which almost always makes my life better in ways I don't always expect). Certainly when we made less money we had to coordinate much more.
  - StavrosK 7y ago
    Yeah, I guess you're right. I was thinking of a situation where one spouse has a high income and the other one is very spendy, but that's a pathological case, and not what's happening with me personally, so what you say makes sense, thank you.
- loco5niner 7y ago
  At seven figures, you shouldn't have any money problems.
  - m463 7y ago
soperj 7y ago
This sounds basically like have one pot of money, but allow both people to blow some of it every month on unnecessary stuff. Which is the opposite of what a saver personality would like to do. I don't see how it would work in a relationship where one person is blowing the "fun money" every month while the other person saves it. There would still be resentment.
- lupire 7y ago
  There's no way to create a budget the solves the problem of partners fundamentally disagreeing about the economic model of their shared life.
  - jschwartzi 7y ago
    The best system seems to be to communicate honestly and openly, to be accepting of your partner's differences, to establish and allow personal boundaries, and to negotiate when boundaries seem to interfere with each other. So basically to have a healthy relationship.
- loco5niner 7y ago
  > blow some of it every month on unnecessary stuff. Sounds like you are a saver. I'd like to point out that resentment can go both ways. They addressed this in the article. A conversation needs to be had to decide as a couple how much (non-zero amount of) money is to be spent. It can easily be a low number, if that's what the couple agrees on. As long as the couple comes together in that conversation, there should not be any resentment. If there is resentment after that conversation (as long as the agreement is followed), the "resenter" is in the wrong.
- clavalle 7y ago
  That's the beauty of the system...each one should not care what the other does with their 'allowance'. If one wants to save, or invest, or what have you, while the other one buys gifts for your neighbor's aunt because they like giving gifts to everyone...well, so be it. It is not from the centrally held account so it is perfectly fine. Meanwhile, that central account and the rules of expenditure are rock solid and it will remain unmolested with wild gift giving, or extravagant lunches, or a risky investment, or the burning desire to save every penny under a mattress.It is resentment free.
treespace8 7y ago
My wife and I do the share model. However money is a very emotional thing. The only thing I’m strict about is big picture. IE, Do we have enough savings? Are we on track of retirement? If I focused on keeping a fun money budget things would get stressful. IE is her hair, nails from fun money? When I take the kids to laser quest is that my fun money? Did we really need new placemats? Should that be fun money? When there are no kids and both work full time it’s simple enough I guess. But when you are a parents it just gets too complicated.
kasey_junk 7y ago
I think this skips the biggest source of tension in my household with regards to money. The only way I know to describe that is 'it's worth less to you than to me'. For instance, I would tomorrow gladly outsource the entirety of our laundry work to a service. It would be much cheaper than other monthly expenses we have that I value much less highly. But my wife has shot that down. She has all manner of reasons why its not a good idea and none of them are related to the bare economics of the problem. As academic economics has found, so does my family, the models need to be sensitive to lots of data that is not captured in price to make reasoning about these things workable.
- supertrope 7y ago
  Different utility functions. However ability to compromise, organize, and communicate can smooth over differences.
- dmayle 7y ago
  Have you considered something like asking for laundry service as a birthday gift? My wife and I have similar spending patterns, but if we had different valuations on something, I would want to be able to talk about it (express my desire), show a willingness to compromise (in exchange of a birthday gift) but in a way that respected her valuation.
xondono 7y ago
While I’m sure it works for the OP, I’m guessing most other options would work. My take is that this approach just moves the discussion to what qualifies as “fun money” or should come out of the shared account. Maybe it’s because we are too young yet, but me and my SO just have a shared account and contribute to it equally (she insisted, I wanted to do proportional). We make sure to put in there enough to cover the bills and some more to have some “emergency money”. Aside from that we keep separate savings accounts and some investments.
- deleted 7y ago
  [deleted]
fegu 7y ago
The article, and comments so far, focus on income only. This is the easy part. A lot of people have savings or investments going in. Perhaps one is renting and the other owns a house. This is where it gets tricky. Especially considering it would be prudent to lay plans that also work well in the event of a divorce.
deckard1 7y ago
Where there is a social issue, there is an engineer with analysis and a clever system to "fix" it. Budgeting is one thing. But developing a fairness system... are you sure you should be married to this person in the first place? Might want to go and tweak that algorithm a bit. In all seriousness, systems like this are brittle and really only work if you're on the same page anyway. In which case, you don't need the system. If your SO likes to spend, he or she may not agree that the "fun money" allocation is enough. You may think it's too much. So you come up with some middle ground. Resentment builds over time because your SO can't always afford the things they want, and you resent having too much allocated to his/her pile of fun money. tl;dr: if you're not on the same page financially, a fancy system won't save your marriage. Fancy systems and over-analysis can also bring problems, YMMV.
- lotsofpulp 7y ago
  I also find all this clerical nonsense funny. If your SO and you are not on the same page regarding goals and what both are willing to prioritize or sacrifice to achieve them, then it’s all moot.
dougmwne 7y ago
We've had separate finances for 12 years and it's seemed to work well for us. We combine the "I've got it" approach for little things and "Let's split it" for large shared purchases. It leads to healthy communication and negotiation on large purchases, plus personal responsibility of our own incomes, expenses and savings. Large purchases that are not shared can be subject to opinion, but never control. Of course, there's no substitute for financial compatibility.
llamataboot 7y ago
We pretty much do this, although it's a little subject to the same thing that "unlimited PTO" is - one person may feel guiltier about spending money than the other and it may crop up in various ways. The only thing we haven't quite figured out how to account for yet is that we are occupying pretty 'conventional' roles by choice and by practicality. I can make a lot more money for many reasons, most of them have nothing to do with me, and they certainly don't have /anything/ to do with me working harder or being more valuable than my wife. It is what it is, and we mostly are okay with it. However, because a ton of my wife's work is still unseen and undervalued (by society, and sometimes by me) and even though we have both agreed that she shouldn't work a low paying job she hates just for the sake of working, and even though we both see that much of her labor is in the traditionally feminine realm of home-making, emotional support, maintaining social connections, etc (which are all very valuable! They make my life immeasurably better! I couldn't afford to pay for them at market rates!) So our arrangement works well for us if we stay married of course, yet if we don't, I am arguably in a much stronger position of being able to make money, still have an intact work history, etc etc. Yes historically this is where alimony comes in, but it is still hard to grapple with. You never want to think about your relationship ending, yet you also want to work together to make sure that the choices that you have both made that work best for you while you are together don't become something far worse in retrospect if you choose to part.
- rayiner 7y ago
  It’s a very real concern that really comes to a peak when you get older. My mom, as well as my wife’s mom and step mom really felt the pressure of being financially dependent on their husband once they got to their 50s and 60s. It’s not only the lost earning power—even social security forces you into dependency, since your benefits are keyed to what you earned while working. The one with the most peace of mind now seems to be my wife’s ex step mom, who never had her own kids and maintained her career the whole time.
hnruss 7y ago
This is exactly the system that we use. The downsides that we have encountered so far: - Pooling our money in a shared account makes it seem like we have money than we actually do, leading to overspending - We each have different ideas of what is a necessary expense To fix this, we had to start communicating a lot more about finances than we used to. We wound up creating a spreadsheet to track recurring expenses and calculate our monthly budget. We decide ahead of time what we're going to spend money on, and talk about it when unexpected expenses occur. The benefits of this system seem to outweigh the downsides, so we'll probably keep doing this for the foreseeable future.
unholyguy001 7y ago
Betting the OP doesn’t have kids. Until you have kids you are playing the game on easy mode The biggest problem with the approach is large, optional purchases that effect quality of life. Things that are too big for “fun money” Remodeling or Upgrading a house Private school for kids Vacations Vacation property Nice cars College savings Rainy day funds One way to handle such is for both partners to agree on % saved out of the joint account and/or minimum balance
- m463 7y ago
  > Until you have kids you are playing the game on easy mode Ha. That reminds me of "If you want to learn to get up early, have kids." (altough more accurately the school district sets your wake times).
- kelnos 7y ago
  Only two of the things you mentioned (private school and college savings) are unique to people with children. All kid-related expenses (including private school and college fund) should be considered joint expenses and come out of the shared pool of money. Parents should agree on how much to spend monthly/yearly on non-essential/fun stuff for the kids (similar to how the parents each get their own fun money allocation). If one parent wants to exceed that for a one-off thing (and the other parent disagrees), they can dip into their own fun-money allocation. Couples without kids still have to decide what to do about home improvements, vacations, vacation property, cars, and rainy day funds. It's just that couples with kids may have less money to allocate toward those things, or have to make harsher compromises. But hey, if you decide to have kids, that's what you've signed up for. A couple might agree that replacing the old, fraying carpets is obviously a joint expense, but the fancy car that only one spouse wants and cares about is a personal/fun-money expense. Having or not having kids doesn't change that.
deleted 7y ago
[deleted]
rconti 7y ago
This was the least surprising result. I thought "combined finances, with an allowance" was basically the default for married couples who have been together a long time and/or since they were fairly young. Currently my wife and I just contribute an equal amount to a joint account for the mortgage and car, and the rest is basically "I've got it" in a proportional sense. It basically works because we spend less than we make, so we have savings. I'm currently out a TON of money for an upcoming vacation, but I kind of have the sense that it all works out in the end, because I am not (yet) out of money, and if I have to dip into "my" savings to pay the bills from the trip, well, from a net perspective "we" still have the same amount of money as if I asked her to pony up some to pay my credit card this month. But of course, this fails plenty of tests, and will have to be re-thought if one of us ends up out of work.
- mercutio2 7y ago
  Amongst my social group your approach is relatively unusual. A sizable fraction of adults can’t be bothered to form a budget and do bookkeeping. This always surprises me, but it seems to be true. You can’t really have an allowance system without some amount of tracking/budgeting. Of course, most couples in my social circle are extremely wealthy by non-Bay Area standards, so that gives people a lot less direct incentive to be especially thrifty. My parents, and my marriage, have a different system: we ask ourselves about every purchase if it’s likely to bring us as much joy as we feel the money is worth, and just don’t buy that much stuff because most things don’t seem like they’d bring us enough joy to be worth the outlay. Then, when we want something expensive, and say “yes, a new couch will bring me joy even if it doesn’t bring you much joy”, we don’t worry about the cost all that much. But having a non-scarcity mentality about this sort of thing is obviously a super privileged position to be in. When my father remarried, he tried this system with my stepmother and she... spent all their money on frivolities they couldn’t afford, and now he’s retired and barely has any savings. So I don’t really recommend this system unless you and your partner have reasonably similar utility functions.
  - rconti 7y ago
    "My" approach is just the chip-in. The allowance system is what I ASSUME most people use (the one the article is advocating). I'm surprised the author thinks it's novel. I agree on budgeting and bookkeeping. Frankly, we do neither. I buy a bigass TV because I want it, my wife buys some awesome workout gear because she wants it. It just works. But yes, it's a position of luxury to not have to budget.
isbjorn16 7y ago
#4 misses some other cases. My spouse and I are firmly in this category, but we also have different spending habits for sure! They buy a lot of little stuff that I don't see as particularly useful, while I don't buy anything at all for months on end, until I spend a whole hell of a lot all at once. Should be a recipe for disaster, right? Except it isn't. We just accept that this is who we are, and we're comfortable with that. The author correctly notes that things can change over time, but they seem to ignore the most important thing to this entire process working: we use our words and talk about things before they become an actual problem. Since my spouse and I have accepted this scenario as being perfectly fine for us now, our normal doesn't frustrate either of us, even though we are wildly different in our spending approaches. And when things change, we're both comfortable making changes to accommodate those changes. Some of you might be saying "but yes, averaged out over the year you probably spend the same", and the answer is no. Not even close. I may spend 600$ on a gaming monitor with a 6 month gap on either side, but my spouse ends up spending more like 4000$ on little bits and bobs throughout that same year period. Guess what? This inequality doesn't bother either of us. Why should it? We're in this together and both of us need to be happy with what we're doing. I don't need 6.6667 gaming monitors, and the point isn't to try to equalize our expenditures. Buy what you need to make your life better, and then buy no more. Or, at least, that has worked for us for the last 15 years. Things could change! Things can always change. But I'm not even remotely worried about that; because that's when we make dinner and sit in front of a couple laptops with a bottle of wine and work out a much more strict budget and emphasize a more restrained approach toward both of our spending patterns. It's happened before, it may happen again, but we'll be fine because we come to a consensus on our financial goals and priorities and neither of us have ever acted in bad faith with regards to achieving those goals and priorities. And if that changes? Well, a more fundamental thing has changed, and maybe we SHOULD have marital strife. And that's okay too.
- cm2012 7y ago
  Pretty much every sentence of your comment is true for my wife and I. What's "fair" is whatever everyone is happy with. I can't imagine being upset because my wife spent more money than me in the abstract.
rayiner 7y ago
My wife and I have been married 7 years and we just got a joint account last year so we could deposit a check endorses to us jointly. We have two kids together, but sharing finances seems terrifying.
- harryh 7y ago
  How do you handle joint expenses like rent/mortgage and all the kid stuff?
  - rayiner 7y ago
    We split them up, roughly based on ability to pay. It reduces friction, but the downside is that I think it reduces our ability to optimize expenditures. (You don’t have two person sign off on most expenses.)
    - harryh 7y ago
      My wife and I basically do this with a joint checking account + credit card that we contribute to (somewhat unequally) every month an amount that is designed to cover 1 month's of expenses plus a little buffer. I find it makes it a lot easier to know that $X thousand/month is my "family expense" and then everything for that is easily accounted for in a way that is totally separate from my personal finances. I actually have two separate mint accounts, one for family expenses and one for my personal stuff.
      - rayiner 7y ago
        That makes a lot of sense. We’ve been trying to set that up just for simplicity of keeping track of auto payments and whatnot, but it’s so hard to switch everything over.
matdrewin 7y ago
We just have joined everything. If we split, it would be 50/50 but I'd probably end up giving her most of the stuff, I already find that we have way too much stuff as it is. I like the simplicity of it all even though it might not be advantageous financially for me. Personally, I find that "fun money" is the easy part. We both splurge from time to time but it is reasonable for the most part. The hard part is the big shared expenses which you'll never be able to cover with "fun money" or it sucks to do alone (house renovations, cars, trips, entertainment etc.) for which 1 partner doesn't see the value of the shared expense.
n42 7y ago
My partner is what some might call a trust fund baby. Her family is fortunate enough that she need not work. She will likely receive a sizable inheritance. Her parents have shielded her from their wealth, while making sure she always has enough to be comfortable. Neither of us knows how much wealth her family holds. They are very discrete. I come from a middle class family that spent their money and saved poorly. I took loans out to go to college. I’ve worked my way up in my career in tech and now make a comfortable salary. This puts us in a situation I feel like this article doesn’t really cover. She doesn’t have a “salary”, but she “makes” more money than I do - however much she needs. I do not plan around her family’s wealth. That is her family’s money, and if/until we ever decide to start our own family, I do not involve myself in their affairs. What we’ve found works for us, is simply a joint credit card. We put shared expenses on it and split it at the end of the month. We use our shared points on vacations we spend together. It is a way of treating each other as equals, and helps prevent either of us feeling taking advantage of. I maintain my own savings and retirement account. She maintains her own investments. I spend my money however I want and have my own personal card, and her the same. If I was out a job, she would support me. If her investments tank or her money were cut off, I would support her. It’s rather simple. The tension we face actually comes from her wealth rather than our lack of it. There are times where she would happily use her wealth as an expression of love. I would never be ok with her father buying us a home. She doesn't understand why not - I was raised to value my own financial independence. I would never feel comfortable living in a home that I did not earn. How do couples in other similar situations handle this?
- mettamage 7y ago
  My uncle is in a similar situation. Currently he's out of a job and he's being supported by her. He told me he had difficulties with the wealth of his wife when he was younger but the older he got, the more he got comfortable with it. He made me realize how much perspective switching there has to be involved in a situation like his since they both value money differently.
- zimablue 7y ago
  Effectively you're under their families power, being "discreet" and doling out money adhoc I wouldn't view as positive, it's them maintaining permanent control. I've long thought that the approach taken by my parents with far less money was pretty good- you get an allocation at 18, more if you're using to to go to uni. If there's any left over at 21 you get the remainder but after that there's nothing more and no expectation of inheritance. I'd try to follow something like this regardless of scale, if it's a couple of million maybe set up a fund that stops at 25
shalmanese 7y ago
The flows are the easy part, the stocks are much harder. 1 partner enters the marriage with a $500K paid off house, the other enters with nothing. They divorce 20 years later and the house is appraised at $2.5M, should: A: partner 1 receive $2.5M, partner 2 receive $0? B: partner 1 receive $1.25M, partner 2 receive $1.25M? C: partner 1 receive $1.5M, partner 2 receive $1M? D: other? How does this answer change if the house can be sold vs can’t be sold? How does this answer change if partner 1 comes into the marriage with a partially paid off mortgage and both contribute to mortgage payments afterwards? How does it change if the house is underwater instead? The problem is all of the above models are legitimate models of how to split ownership, but they’re incompatible views. So you need to reach alignment at the start of the relationship over which model to use, otherwise what could have been an amicable parting ends in bitter recrimination.
- bdowling 7y ago
  The general rule is that property owned prior to a marriage remains the separate property of that owner. So the answer to your first question is generally A. The answers to your other questions will depend on whether the couple is in a marital property state or a community property state, because the default rules regarding marital income are different.
  - lukasm 7y ago
    Not sure why you've been downvoted. This is how it works in my country and I think this makes sense.
    - roel_v 7y ago
      Because the topic is not "what's the default legal situation".
      - infinite8s 7y ago
        But if you don't discuss beforehand and come to an agreement, the default legal situation applies.
vitoc 7y ago
In Prudent, you can combine multiple journals. Your wife can maintain a separate journal while you maintain another one. This way, both parties can do whatever they want or agree to some set of rules. Most importantly, at any time, you or your wife can see the combined financial strength, or individual financial situation. Awareness of both can make a big difference in making important financial decisions. Avoid being penny wise, pound foolish. The combined report (of savings, etc.) gives both of you better insights on the financial journey that you can embark together (i.e. buying a house, having kids, moving cities, etc.) https://docs.prudent.me/docs/combining https://docs.prudent.me/docs/combining
galfarragem 7y ago
I'll bite it. With nowadays lifestyle and state of Law doesn't make sense to marry in the traditional sense. Ok you can do a pre-nup but that is a huge hassle for the couple. People value stuff differently and on the long term ignoring that is a certain path to regrets. So the best, IMHO, each one should keep legally their stuff with some joint ventures on common projects (house, etc). However I'm not saying to strictly split every expense or be stingy. I'm happy to pay most of daily expenses, holydays or extras. I just don't want to wake up one day feeling used neither legally get stuff from my partner or her family.
- deleted 7y ago
  [deleted]
aliceryhl 7y ago
Me and my boyfriend are students. I have a good student job, while my boyfriend has a large amount of savings. The last system here would just amount to him giving me his savings. Our system is that we have a shared account, and we keep track of how much money we have both put into that account. I've put in about half what he has put in, because he spent a lot of money when we bought all of the furniture etc. for our rented apartment, when we moved in. So then I just put in a bit more than him each month, until we reach the same level.
avip 7y ago
My biggest challenge, not discussed here at all, is how to force my wife into taking financial decisions. Numerous times I’ve tried to walk her through our finances, trying to make our life choices and trade offs more explicit. Yes we could move to a nicer place but we’ll have to cut down on kids activities. I feel I’m taking all the decisions myself.
- zrail 7y ago
  Can't really force anyone to do anything. For awhile my spouse and I did a monthly "money talk" where we walked through the monthly income and expenses and talked about things coming up. Eventually they decided they'd rather just not pay attention.
zrail 7y ago
My wife and I had split finances while we were dating and for a few years after we got married. The thing that tipped us into "everything shared" was when we were expecting our first kid and my wife left her job. At that point split finances just didn't make any sense. Now we have a system basically identical to the OP's system and everybody is happy with it.
filesystemdude 7y ago
Our system: I make more, and I pay for the biggest expenses (mortgage, and previously cars and student loans before we paid those off) and have healthcare and whatnot taken from my paycheck. She makes less but still a decent amount and pay for the smaller bills. Every once in a while, she'll pay for a big-ticket item (like a vacation or a large house repair) out of her savings, which accumulate faster than mine, to catch up. It works because we started together with next to nothing, so we're both big savers: Our combined income our first year together after college a little over ten years ago was probably a quarter of what we'll make this year. We both max out (or come very close to maxing out) retirement now. She has more cash on hand because I'm paid proportionately more in various types of stock incentives, so when my incentives vest I tend to sell the company stock to diversify but keep the money in investments). We live in a small house, no kids, reasonably cheap cars, vacations are often tacked on to work trips to save money, no expensive hobbies. I doubt I'll "retire" early but our savings mean if I decide to leave tech in a decade and become a woodworker or park ranger, I can with no monetary consequences.
mariojv 7y ago
This is interesting. I looked around a bit for decent surveys or studies that break down statistics about couples who share finances this way versus using some other system, but I'm having a hard time finding any. There are some surveys on why couples with joint accounts also maintain individual accounts, one of which seems to indicate independence is the biggest factor (38% of respondents). Only 16% said they did it for ease of budgeting, which to me seems to indicate that the system recommended by the article is relatively uncommon. [0] For us, we keep it relatively simple. We have some savings from before the marriage in separate accounts that we use for stuff like surprise gifts or security when we need to pay something that requires a direct transfer online. Everything else comes from the joint account or goes through a joint credit card that we pay off every month. Although our opinions still differ slightly on some long term goals that we won't have to decide on for a while, generally if there's a disagreement we just talk it out. We consult each other on expensive purchases, generally non-necessities over a certain amount. We've both supported each other through periods of temporary unemployment or income differences. Admittedly, having similar values and living in a low cost of living area helps a lot with this. I'm not sure the system in the article would help too much for resolving expensive decisions unrelated to individual hobbies. For example, if one person wants to spend a larger portion of income on housing that requires more joint contribution, there's still a possible conflict. It does make those kind of decisions have a discussion built in by default though, which is definitely a good thing. Overall it seems to me that the key thing is that people are having healthy discussions and making decisions together - including decisions around what to leave totally up to the other person, like the article's system does. Some conflict might be totally avoidable, but I think there's no way around just learning how to resolve disagreements respectfully. [0] https://www.prnewswire.com/news-releases/td-bank-survey-finds-many-couples-maintain-separate-bank-accounts-251917121.html https://www.prnewswire.com/news-releases/td-bank-survey-find...

112 points by dontmitch 7y ago

This is what my SO and me have been doing for 8 ish years now and it's great. We call it "pocket money". I can't complain when she spends it all on shoes and bags, she can't complain when I spend it all on beer and hamburgers. When we were poor, we both only got a little pocket money each month. Now that we're richer, we both get more. I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my home town. It's terribly decadent but hey, it's my money. Other people buy iPhones. I have nobody to answer to but me. It's lovely. I warmly recommend pocket money.

duxup 7y ago
>I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my home town. Where do you find the time to clean all your monocles?
- skrebbel 7y ago
  I usually ask the maid to do it.
  - kevin_thibedeau 7y ago
    You need to upgrade to a valet.
lupire 7y ago
What happens if you spend your pocket money on end-of-life care, and then your SO wants some too?
- loco5niner 7y ago
  End-of-life care has nothing to do with pocket money.
blts 7y ago
Does it lead to overspending? Since you have your pocket money - then you need to spend it?
- Cerium 7y ago
  My wife and I use the same system, and I would say no. We both tend to save ours and then spend more some months than others.
- shostack 7y ago
  If budgeted for properly, this should in their reduce overspending because the amount you can freely spend is one you've previously accounted for as "an appropriate amount."
- skrebbel 7y ago
  I think I get too little of it for that :-)

duxup 7y ago

I see lots of choices out there, and different things work for different people... and sometimes things evolve, and like relationships the finances should / will too, even when you don't want them to. It became clear that when my wife went back to school we couldn't sit and do math or rearrange everything all the time. We just put it altogether. Nothing is easier when married than just putting it into one pot and it is all "our" money. It's not about who does what (maybe one day someone does more dishes, makes more money) and it's all "ours". But even than if you have a couple with very different spending and someone is more responsible, I don't think it is bad to establish an "allowance" for everyone for as the article describes "splurges". The important thing is to always be communicating about it.

challenger22 7y ago

I would be very frustrated if I explicity had less fun money than my spouse.

blairbeckwith 7y ago
That is exactly the opposite of what the article suggests. > Both partners have equal access to it, and both partners will continue to receive the same monthly allocation for fun money no matter how much each person makes.
MereInterest 7y ago
It definitely depends on the couple. Currently, I am working and my spouse is not. During our most recent talk about budgeting a few months ago, we took this into account when figuring out appropriate amounts of fun money for each of us. Specifically, since I am out of the office/house for lunch/dinner less often, and my hobbies (programming/baking) are inexpensive, I neither need nor want as much fun money, and I would rather they have it available instead.

StavrosK 7y ago

What if one spouse makes seven figures and the other is unemployed and takes care of the household? The income disparity then is too high for this, it seems to me, but maybe it's just me.

toast0 7y ago
My spouse and I have a simple plan. I make the money, and my spouse spends it. :) When money was tighter, we would coordinate more closely and more frequently about expenses and timing. Now I just maintain a certain balance in checking and we coordinate over large payments to make sure they don't hit checking all at once. If you or your spouse is making seven figures, you shouldn't have actual money problems -- even if taxes take half, you can save half and still have 250k/year to spend; spend half of that on a $5M mortgage, and you've still got more spending money than US median income. Your money management priorities should be around limiting the time it takes to manage, unless you get enjoyment out of micro managing it.
- cm2012 7y ago
  My relationship is the same. I make a lot of money, and there's not much I want. I get a lot of joy out of watching my wife get things she wants though (which almost always makes my life better in ways I don't always expect). Certainly when we made less money we had to coordinate much more.
- StavrosK 7y ago
  Yeah, I guess you're right. I was thinking of a situation where one spouse has a high income and the other one is very spendy, but that's a pathological case, and not what's happening with me personally, so what you say makes sense, thank you.
loco5niner 7y ago
At seven figures, you shouldn't have any money problems.
- m463 7y ago

soperj 7y ago

This sounds basically like have one pot of money, but allow both people to blow some of it every month on unnecessary stuff. Which is the opposite of what a saver personality would like to do. I don't see how it would work in a relationship where one person is blowing the "fun money" every month while the other person saves it. There would still be resentment.

lupire 7y ago
There's no way to create a budget the solves the problem of partners fundamentally disagreeing about the economic model of their shared life.
- jschwartzi 7y ago
  The best system seems to be to communicate honestly and openly, to be accepting of your partner's differences, to establish and allow personal boundaries, and to negotiate when boundaries seem to interfere with each other. So basically to have a healthy relationship.
loco5niner 7y ago
> blow some of it every month on unnecessary stuff. Sounds like you are a saver. I'd like to point out that resentment can go both ways. They addressed this in the article. A conversation needs to be had to decide as a couple how much (non-zero amount of) money is to be spent. It can easily be a low number, if that's what the couple agrees on. As long as the couple comes together in that conversation, there should not be any resentment. If there is resentment after that conversation (as long as the agreement is followed), the "resenter" is in the wrong.
clavalle 7y ago
That's the beauty of the system...each one should not care what the other does with their 'allowance'. If one wants to save, or invest, or what have you, while the other one buys gifts for your neighbor's aunt because they like giving gifts to everyone...well, so be it. It is not from the centrally held account so it is perfectly fine. Meanwhile, that central account and the rules of expenditure are rock solid and it will remain unmolested with wild gift giving, or extravagant lunches, or a risky investment, or the burning desire to save every penny under a mattress.It is resentment free.

treespace8 7y ago

My wife and I do the share model. However money is a very emotional thing. The only thing I’m strict about is big picture. IE, Do we have enough savings? Are we on track of retirement? If I focused on keeping a fun money budget things would get stressful. IE is her hair, nails from fun money? When I take the kids to laser quest is that my fun money? Did we really need new placemats? Should that be fun money? When there are no kids and both work full time it’s simple enough I guess. But when you are a parents it just gets too complicated.

kasey_junk 7y ago

I think this skips the biggest source of tension in my household with regards to money. The only way I know to describe that is 'it's worth less to you than to me'. For instance, I would tomorrow gladly outsource the entirety of our laundry work to a service. It would be much cheaper than other monthly expenses we have that I value much less highly. But my wife has shot that down. She has all manner of reasons why its not a good idea and none of them are related to the bare economics of the problem. As academic economics has found, so does my family, the models need to be sensitive to lots of data that is not captured in price to make reasoning about these things workable.

supertrope 7y ago
Different utility functions. However ability to compromise, organize, and communicate can smooth over differences.
dmayle 7y ago
Have you considered something like asking for laundry service as a birthday gift? My wife and I have similar spending patterns, but if we had different valuations on something, I would want to be able to talk about it (express my desire), show a willingness to compromise (in exchange of a birthday gift) but in a way that respected her valuation.

xondono 7y ago

While I’m sure it works for the OP, I’m guessing most other options would work. My take is that this approach just moves the discussion to what qualifies as “fun money” or should come out of the shared account. Maybe it’s because we are too young yet, but me and my SO just have a shared account and contribute to it equally (she insisted, I wanted to do proportional). We make sure to put in there enough to cover the bills and some more to have some “emergency money”. Aside from that we keep separate savings accounts and some investments.

deleted 7y ago
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fegu 7y ago

The article, and comments so far, focus on income only. This is the easy part. A lot of people have savings or investments going in. Perhaps one is renting and the other owns a house. This is where it gets tricky. Especially considering it would be prudent to lay plans that also work well in the event of a divorce.

deckard1 7y ago

Where there is a social issue, there is an engineer with analysis and a clever system to "fix" it. Budgeting is one thing. But developing a fairness system... are you sure you should be married to this person in the first place? Might want to go and tweak that algorithm a bit. In all seriousness, systems like this are brittle and really only work if you're on the same page anyway. In which case, you don't need the system. If your SO likes to spend, he or she may not agree that the "fun money" allocation is enough. You may think it's too much. So you come up with some middle ground. Resentment builds over time because your SO can't always afford the things they want, and you resent having too much allocated to his/her pile of fun money. tl;dr: if you're not on the same page financially, a fancy system won't save your marriage. Fancy systems and over-analysis can also bring problems, YMMV.

lotsofpulp 7y ago
I also find all this clerical nonsense funny. If your SO and you are not on the same page regarding goals and what both are willing to prioritize or sacrifice to achieve them, then it’s all moot.

dougmwne 7y ago

We've had separate finances for 12 years and it's seemed to work well for us. We combine the "I've got it" approach for little things and "Let's split it" for large shared purchases. It leads to healthy communication and negotiation on large purchases, plus personal responsibility of our own incomes, expenses and savings. Large purchases that are not shared can be subject to opinion, but never control. Of course, there's no substitute for financial compatibility.

llamataboot 7y ago

We pretty much do this, although it's a little subject to the same thing that "unlimited PTO" is - one person may feel guiltier about spending money than the other and it may crop up in various ways. The only thing we haven't quite figured out how to account for yet is that we are occupying pretty 'conventional' roles by choice and by practicality. I can make a lot more money for many reasons, most of them have nothing to do with me, and they certainly don't have /anything/ to do with me working harder or being more valuable than my wife. It is what it is, and we mostly are okay with it. However, because a ton of my wife's work is still unseen and undervalued (by society, and sometimes by me) and even though we have both agreed that she shouldn't work a low paying job she hates just for the sake of working, and even though we both see that much of her labor is in the traditionally feminine realm of home-making, emotional support, maintaining social connections, etc (which are all very valuable! They make my life immeasurably better! I couldn't afford to pay for them at market rates!) So our arrangement works well for us if we stay married of course, yet if we don't, I am arguably in a much stronger position of being able to make money, still have an intact work history, etc etc. Yes historically this is where alimony comes in, but it is still hard to grapple with. You never want to think about your relationship ending, yet you also want to work together to make sure that the choices that you have both made that work best for you while you are together don't become something far worse in retrospect if you choose to part.

rayiner 7y ago
It’s a very real concern that really comes to a peak when you get older. My mom, as well as my wife’s mom and step mom really felt the pressure of being financially dependent on their husband once they got to their 50s and 60s. It’s not only the lost earning power—even social security forces you into dependency, since your benefits are keyed to what you earned while working. The one with the most peace of mind now seems to be my wife’s ex step mom, who never had her own kids and maintained her career the whole time.

hnruss 7y ago

This is exactly the system that we use. The downsides that we have encountered so far: - Pooling our money in a shared account makes it seem like we have money than we actually do, leading to overspending - We each have different ideas of what is a necessary expense To fix this, we had to start communicating a lot more about finances than we used to. We wound up creating a spreadsheet to track recurring expenses and calculate our monthly budget. We decide ahead of time what we're going to spend money on, and talk about it when unexpected expenses occur. The benefits of this system seem to outweigh the downsides, so we'll probably keep doing this for the foreseeable future.

unholyguy001 7y ago

Betting the OP doesn’t have kids. Until you have kids you are playing the game on easy mode The biggest problem with the approach is large, optional purchases that effect quality of life. Things that are too big for “fun money” Remodeling or Upgrading a house Private school for kids Vacations Vacation property Nice cars College savings Rainy day funds One way to handle such is for both partners to agree on % saved out of the joint account and/or minimum balance

m463 7y ago
> Until you have kids you are playing the game on easy mode Ha. That reminds me of "If you want to learn to get up early, have kids." (altough more accurately the school district sets your wake times).
kelnos 7y ago
Only two of the things you mentioned (private school and college savings) are unique to people with children. All kid-related expenses (including private school and college fund) should be considered joint expenses and come out of the shared pool of money. Parents should agree on how much to spend monthly/yearly on non-essential/fun stuff for the kids (similar to how the parents each get their own fun money allocation). If one parent wants to exceed that for a one-off thing (and the other parent disagrees), they can dip into their own fun-money allocation. Couples without kids still have to decide what to do about home improvements, vacations, vacation property, cars, and rainy day funds. It's just that couples with kids may have less money to allocate toward those things, or have to make harsher compromises. But hey, if you decide to have kids, that's what you've signed up for. A couple might agree that replacing the old, fraying carpets is obviously a joint expense, but the fancy car that only one spouse wants and cares about is a personal/fun-money expense. Having or not having kids doesn't change that.

deleted 7y ago

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rconti 7y ago

This was the least surprising result. I thought "combined finances, with an allowance" was basically the default for married couples who have been together a long time and/or since they were fairly young. Currently my wife and I just contribute an equal amount to a joint account for the mortgage and car, and the rest is basically "I've got it" in a proportional sense. It basically works because we spend less than we make, so we have savings. I'm currently out a TON of money for an upcoming vacation, but I kind of have the sense that it all works out in the end, because I am not (yet) out of money, and if I have to dip into "my" savings to pay the bills from the trip, well, from a net perspective "we" still have the same amount of money as if I asked her to pony up some to pay my credit card this month. But of course, this fails plenty of tests, and will have to be re-thought if one of us ends up out of work.

mercutio2 7y ago
Amongst my social group your approach is relatively unusual. A sizable fraction of adults can’t be bothered to form a budget and do bookkeeping. This always surprises me, but it seems to be true. You can’t really have an allowance system without some amount of tracking/budgeting. Of course, most couples in my social circle are extremely wealthy by non-Bay Area standards, so that gives people a lot less direct incentive to be especially thrifty. My parents, and my marriage, have a different system: we ask ourselves about every purchase if it’s likely to bring us as much joy as we feel the money is worth, and just don’t buy that much stuff because most things don’t seem like they’d bring us enough joy to be worth the outlay. Then, when we want something expensive, and say “yes, a new couch will bring me joy even if it doesn’t bring you much joy”, we don’t worry about the cost all that much. But having a non-scarcity mentality about this sort of thing is obviously a super privileged position to be in. When my father remarried, he tried this system with my stepmother and she... spent all their money on frivolities they couldn’t afford, and now he’s retired and barely has any savings. So I don’t really recommend this system unless you and your partner have reasonably similar utility functions.
- rconti 7y ago
  "My" approach is just the chip-in. The allowance system is what I ASSUME most people use (the one the article is advocating). I'm surprised the author thinks it's novel. I agree on budgeting and bookkeeping. Frankly, we do neither. I buy a bigass TV because I want it, my wife buys some awesome workout gear because she wants it. It just works. But yes, it's a position of luxury to not have to budget.

isbjorn16 7y ago

#4 misses some other cases. My spouse and I are firmly in this category, but we also have different spending habits for sure! They buy a lot of little stuff that I don't see as particularly useful, while I don't buy anything at all for months on end, until I spend a whole hell of a lot all at once. Should be a recipe for disaster, right? Except it isn't. We just accept that this is who we are, and we're comfortable with that. The author correctly notes that things can change over time, but they seem to ignore the most important thing to this entire process working: we use our words and talk about things before they become an actual problem. Since my spouse and I have accepted this scenario as being perfectly fine for us now, our normal doesn't frustrate either of us, even though we are wildly different in our spending approaches. And when things change, we're both comfortable making changes to accommodate those changes. Some of you might be saying "but yes, averaged out over the year you probably spend the same", and the answer is no. Not even close. I may spend 600$ on a gaming monitor with a 6 month gap on either side, but my spouse ends up spending more like 4000$ on little bits and bobs throughout that same year period. Guess what? This inequality doesn't bother either of us. Why should it? We're in this together and both of us need to be happy with what we're doing. I don't need 6.6667 gaming monitors, and the point isn't to try to equalize our expenditures. Buy what you need to make your life better, and then buy no more. Or, at least, that has worked for us for the last 15 years. Things could change! Things can always change. But I'm not even remotely worried about that; because that's when we make dinner and sit in front of a couple laptops with a bottle of wine and work out a much more strict budget and emphasize a more restrained approach toward both of our spending patterns. It's happened before, it may happen again, but we'll be fine because we come to a consensus on our financial goals and priorities and neither of us have ever acted in bad faith with regards to achieving those goals and priorities. And if that changes? Well, a more fundamental thing has changed, and maybe we SHOULD have marital strife. And that's okay too.

cm2012 7y ago
Pretty much every sentence of your comment is true for my wife and I. What's "fair" is whatever everyone is happy with. I can't imagine being upset because my wife spent more money than me in the abstract.

rayiner 7y ago

My wife and I have been married 7 years and we just got a joint account last year so we could deposit a check endorses to us jointly. We have two kids together, but sharing finances seems terrifying.

harryh 7y ago
How do you handle joint expenses like rent/mortgage and all the kid stuff?
- rayiner 7y ago
  We split them up, roughly based on ability to pay. It reduces friction, but the downside is that I think it reduces our ability to optimize expenditures. (You don’t have two person sign off on most expenses.)
  - harryh 7y ago
    My wife and I basically do this with a joint checking account + credit card that we contribute to (somewhat unequally) every month an amount that is designed to cover 1 month's of expenses plus a little buffer. I find it makes it a lot easier to know that $X thousand/month is my "family expense" and then everything for that is easily accounted for in a way that is totally separate from my personal finances. I actually have two separate mint accounts, one for family expenses and one for my personal stuff.
    - rayiner 7y ago
      That makes a lot of sense. We’ve been trying to set that up just for simplicity of keeping track of auto payments and whatnot, but it’s so hard to switch everything over.

matdrewin 7y ago

We just have joined everything. If we split, it would be 50/50 but I'd probably end up giving her most of the stuff, I already find that we have way too much stuff as it is. I like the simplicity of it all even though it might not be advantageous financially for me. Personally, I find that "fun money" is the easy part. We both splurge from time to time but it is reasonable for the most part. The hard part is the big shared expenses which you'll never be able to cover with "fun money" or it sucks to do alone (house renovations, cars, trips, entertainment etc.) for which 1 partner doesn't see the value of the shared expense.

n42 7y ago

My partner is what some might call a trust fund baby. Her family is fortunate enough that she need not work. She will likely receive a sizable inheritance. Her parents have shielded her from their wealth, while making sure she always has enough to be comfortable. Neither of us knows how much wealth her family holds. They are very discrete. I come from a middle class family that spent their money and saved poorly. I took loans out to go to college. I’ve worked my way up in my career in tech and now make a comfortable salary. This puts us in a situation I feel like this article doesn’t really cover. She doesn’t have a “salary”, but she “makes” more money than I do - however much she needs. I do not plan around her family’s wealth. That is her family’s money, and if/until we ever decide to start our own family, I do not involve myself in their affairs. What we’ve found works for us, is simply a joint credit card. We put shared expenses on it and split it at the end of the month. We use our shared points on vacations we spend together. It is a way of treating each other as equals, and helps prevent either of us feeling taking advantage of. I maintain my own savings and retirement account. She maintains her own investments. I spend my money however I want and have my own personal card, and her the same. If I was out a job, she would support me. If her investments tank or her money were cut off, I would support her. It’s rather simple. The tension we face actually comes from her wealth rather than our lack of it. There are times where she would happily use her wealth as an expression of love. I would never be ok with her father buying us a home. She doesn't understand why not - I was raised to value my own financial independence. I would never feel comfortable living in a home that I did not earn. How do couples in other similar situations handle this?

mettamage 7y ago
My uncle is in a similar situation. Currently he's out of a job and he's being supported by her. He told me he had difficulties with the wealth of his wife when he was younger but the older he got, the more he got comfortable with it. He made me realize how much perspective switching there has to be involved in a situation like his since they both value money differently.
zimablue 7y ago
Effectively you're under their families power, being "discreet" and doling out money adhoc I wouldn't view as positive, it's them maintaining permanent control. I've long thought that the approach taken by my parents with far less money was pretty good- you get an allocation at 18, more if you're using to to go to uni. If there's any left over at 21 you get the remainder but after that there's nothing more and no expectation of inheritance. I'd try to follow something like this regardless of scale, if it's a couple of million maybe set up a fund that stops at 25

shalmanese 7y ago

The flows are the easy part, the stocks are much harder. 1 partner enters the marriage with a $500K paid off house, the other enters with nothing. They divorce 20 years later and the house is appraised at $2.5M, should: A: partner 1 receive $2.5M, partner 2 receive $0? B: partner 1 receive $1.25M, partner 2 receive $1.25M? C: partner 1 receive $1.5M, partner 2 receive $1M? D: other? How does this answer change if the house can be sold vs can’t be sold? How does this answer change if partner 1 comes into the marriage with a partially paid off mortgage and both contribute to mortgage payments afterwards? How does it change if the house is underwater instead? The problem is all of the above models are legitimate models of how to split ownership, but they’re incompatible views. So you need to reach alignment at the start of the relationship over which model to use, otherwise what could have been an amicable parting ends in bitter recrimination.

bdowling 7y ago
The general rule is that property owned prior to a marriage remains the separate property of that owner. So the answer to your first question is generally A. The answers to your other questions will depend on whether the couple is in a marital property state or a community property state, because the default rules regarding marital income are different.
- lukasm 7y ago
  Not sure why you've been downvoted. This is how it works in my country and I think this makes sense.
  - roel_v 7y ago
    Because the topic is not "what's the default legal situation".
    - infinite8s 7y ago
      But if you don't discuss beforehand and come to an agreement, the default legal situation applies.

vitoc 7y ago

In Prudent, you can combine multiple journals. Your wife can maintain a separate journal while you maintain another one. This way, both parties can do whatever they want or agree to some set of rules. Most importantly, at any time, you or your wife can see the combined financial strength, or individual financial situation. Awareness of both can make a big difference in making important financial decisions. Avoid being penny wise, pound foolish. The combined report (of savings, etc.) gives both of you better insights on the financial journey that you can embark together (i.e. buying a house, having kids, moving cities, etc.) https://docs.prudent.me/docs/combining https://docs.prudent.me/docs/combining

galfarragem 7y ago

I'll bite it. With nowadays lifestyle and state of Law doesn't make sense to marry in the traditional sense. Ok you can do a pre-nup but that is a huge hassle for the couple. People value stuff differently and on the long term ignoring that is a certain path to regrets. So the best, IMHO, each one should keep legally their stuff with some joint ventures on common projects (house, etc). However I'm not saying to strictly split every expense or be stingy. I'm happy to pay most of daily expenses, holydays or extras. I just don't want to wake up one day feeling used neither legally get stuff from my partner or her family.

deleted 7y ago
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aliceryhl 7y ago

Me and my boyfriend are students. I have a good student job, while my boyfriend has a large amount of savings. The last system here would just amount to him giving me his savings. Our system is that we have a shared account, and we keep track of how much money we have both put into that account. I've put in about half what he has put in, because he spent a lot of money when we bought all of the furniture etc. for our rented apartment, when we moved in. So then I just put in a bit more than him each month, until we reach the same level.

avip 7y ago

My biggest challenge, not discussed here at all, is how to force my wife into taking financial decisions. Numerous times I’ve tried to walk her through our finances, trying to make our life choices and trade offs more explicit. Yes we could move to a nicer place but we’ll have to cut down on kids activities. I feel I’m taking all the decisions myself.

zrail 7y ago
Can't really force anyone to do anything. For awhile my spouse and I did a monthly "money talk" where we walked through the monthly income and expenses and talked about things coming up. Eventually they decided they'd rather just not pay attention.

zrail 7y ago

My wife and I had split finances while we were dating and for a few years after we got married. The thing that tipped us into "everything shared" was when we were expecting our first kid and my wife left her job. At that point split finances just didn't make any sense. Now we have a system basically identical to the OP's system and everybody is happy with it.

filesystemdude 7y ago

Our system: I make more, and I pay for the biggest expenses (mortgage, and previously cars and student loans before we paid those off) and have healthcare and whatnot taken from my paycheck. She makes less but still a decent amount and pay for the smaller bills. Every once in a while, she'll pay for a big-ticket item (like a vacation or a large house repair) out of her savings, which accumulate faster than mine, to catch up. It works because we started together with next to nothing, so we're both big savers: Our combined income our first year together after college a little over ten years ago was probably a quarter of what we'll make this year. We both max out (or come very close to maxing out) retirement now. She has more cash on hand because I'm paid proportionately more in various types of stock incentives, so when my incentives vest I tend to sell the company stock to diversify but keep the money in investments). We live in a small house, no kids, reasonably cheap cars, vacations are often tacked on to work trips to save money, no expensive hobbies. I doubt I'll "retire" early but our savings mean if I decide to leave tech in a decade and become a woodworker or park ranger, I can with no monetary consequences.

mariojv 7y ago

This is interesting. I looked around a bit for decent surveys or studies that break down statistics about couples who share finances this way versus using some other system, but I'm having a hard time finding any. There are some surveys on why couples with joint accounts also maintain individual accounts, one of which seems to indicate independence is the biggest factor (38% of respondents). Only 16% said they did it for ease of budgeting, which to me seems to indicate that the system recommended by the article is relatively uncommon. [0] For us, we keep it relatively simple. We have some savings from before the marriage in separate accounts that we use for stuff like surprise gifts or security when we need to pay something that requires a direct transfer online. Everything else comes from the joint account or goes through a joint credit card that we pay off every month. Although our opinions still differ slightly on some long term goals that we won't have to decide on for a while, generally if there's a disagreement we just talk it out. We consult each other on expensive purchases, generally non-necessities over a certain amount. We've both supported each other through periods of temporary unemployment or income differences. Admittedly, having similar values and living in a low cost of living area helps a lot with this. I'm not sure the system in the article would help too much for resolving expensive decisions unrelated to individual hobbies. For example, if one person wants to spend a larger portion of income on housing that requires more joint contribution, there's still a possible conflict. It does make those kind of decisions have a discussion built in by default though, which is definitely a good thing. Overall it seems to me that the key thing is that people are having healthy discussions and making decisions together - including decisions around what to leave totally up to the other person, like the article's system does. Some conflict might be totally avoidable, but I think there's no way around just learning how to resolve disagreements respectfully. [0] https://www.prnewswire.com/news-releases/td-bank-survey-finds-many-couples-maintain-separate-bank-accounts-251917121.html https://www.prnewswire.com/news-releases/td-bank-survey-find...