When Two Become One

Thinking about money for two

Hi everyone,

Today's note might not apply to everyone, but hopefully, it will one day! I want to offer a short perspective on money as a couple (married or not) and my own view of things. 

Let's start with the basics: it's important that you and your partner have a complete understanding of each other's financial situation. It's up to you to decide when this gets shared, but hopefully, it's not at the dissolution of the relationship. This means knowing what the other makes, roughly how much they spend (doesn't need to be granular really), and any major debts. Why this is kept a secret from one another, I'll never know, but it's certainly a big moment when you have that conversation. Technically, that's the easy stuff. 

white and blue magnetic card

When you decide to actually combine finances, there is a division in how that should be done. Generally, there are a few options:

  1. Combine everything: One shared account for all money, sharing credit cards, etc.

  2. Combine nothing: Keep it all separate, usually meaning someone is solely responsible for the mortgage/rent and you get into the habit of paying each other back.

  3. Somewhere in the middle: A little bit of everything and a little bit of nothing.

I am of the stance that you should combine some things, but not everything. I think the nothing option is a bad one because it's often due to couples not actually sharing their finances. This is the only comfortable option for them. 

I'm against combining everything for a small romantic reason rather than any economic ones: having total transparency into finances and spending eliminates your ability to spend money on things for your partner without them already knowing. It's important to maintain independence in what you choose to do with your money, assuming your relationship is taken care of. That’s truly my only reason but it’s been helpful in setting up a system that works for me. It allows me to spend on whatever I want while still saving for key shared expenses.

For those actually curious about how things are structured for me and my partner:

  • Individual Bank accounts (checking, savings)

  • Individual Investment accounts 

  • Individual credit cards

  • 1 shared bank account

  • 1 shared credit card

We are each paid individually into our own bank accounts. Each pay period, we move a pre-determined amount of money into the shared account that covers all shared expenses (food, rent, internet, dog expenses, etc). We use the shared credit card for all shared expenses (this ends up just being groceries, restaurants, and bubble tea). Then, we do our own thing! It works well for us and there is little desire/benefit in combining all accounts. In a single income household, this might change though.

That's all! Short and simple. Let me know if you have any questions or opposing views.

Thanks for reading.

Steven