Author Topic: Combining Finances after Marriage?  (Read 21053 times)

Megatron

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Combining Finances after Marriage?
« on: January 21, 2014, 03:23:29 PM »
I'm engaged to be married this year and I was just wondering what most mustachians do as far as finances are concern after getting hitched. I've read some articles regarding this topic but I just wanted to poll the audience (MMMs) that most resemble my outlook/goals in life. Do you open joint bank accounts? Do I add her name to my taxable investment account so that we can both contribute together for ER? We both make similar amount. but I am a bit more frugal than her. She's pretty sensible but do sometime slip up and she's not much of a saver until we met a few years ago when I convinced her to up her 401k monthly contribution from 6% to 20% so that she can max it yearly. I have a bit more savings than her but I know she's seen the light. We often talked about early retirement in our early 40s. We've been living together for a year and we don't keep track much of who spend how much on what. I pay the rent and she gets the groceries and bills. sometimes if we buy a big ticket item like a international flight we would pay the other half back.
« Last Edit: January 21, 2014, 03:25:17 PM by Megatron »

Frankies Girl

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Re: Combining Finances after Marriage?
« Reply #1 on: January 21, 2014, 04:00:47 PM »
My husband and I married in our late 20s, with established accounts that were individually ours.

We decided to add each other to the accounts, making two joint checking accounts (one his primary, one mine) and one shared savings account. That way, he could have his check deposited and manage the funds coming into his account, and I could do the same with mine. No worrying over someone not adding a debit transaction or "hiding" money for presents. We still swing money over from one or the other to savings as needed, but as long as we're both working, we'll probably keep the two checking accounts as there's no question of who did what transaction and things run so much more smoothly.

I am the primary as far as dealing with financials, so I wanted to make sure my husband had his own account to keep up with so he would continue to feel involved in our money management (he's not very interested in handling, so it is the most he generally keeps up with on his own).

We've added each other to things like insurance policies, investment account beneficiaries, etc... I don't think investment accounts can be shared, so at best, you can add her as a beneficiary, but she'd need to open her own investment accounts if she wants to officially contribute (you can always add from a shared savings, and as long as you have each other as beneficiaries then the ownership of the accounts would pass to them without going through probate).

And I would suggest you start doing a formal budget  - through something like Mint or YNAB so you both stay on the same page as far as spending. It's very helpful in the early years to track all of that as a couple.

Saverocity

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Re: Combining Finances after Marriage?
« Reply #2 on: January 21, 2014, 04:19:03 PM »
The most important financial decision before embarking on a marriage would be a prenup.  Personally I don't have one, and all our money is mingled, there are people who keep separate accounts and whatnot, that doesn't make sense to me personally but it works for them. 

milla

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Re: Combining Finances after Marriage?
« Reply #3 on: January 21, 2014, 04:21:42 PM »
Most important is for you to have a joint plan. How you work it out with accounts is almost irrelevant if you have a good plan you're both working for.

Shor

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Re: Combining Finances after Marriage?
« Reply #4 on: January 21, 2014, 04:25:01 PM »
I am not married, but the current understanding we have come to so far is that we would maintain the current status quo of separate finances with complete, open transparency.

I make about twice as much as she does, and am often the 'benefactor' when it comes to eating out, and she likes to jump in when we go for cheaper fast-food. I found that I am usually really tight on money on all fronts, except when it comes to her *blush*

This will all change when we eventually get a place together, simply because a home purchase far surpasses the threshold either of us could handle individually, but with our powers combined we become an unstoppable force of leveraged, projected earnings!

StetsTerhune

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Re: Combining Finances after Marriage?
« Reply #5 on: January 21, 2014, 04:30:42 PM »
So this is totally illogical and insanel, but it's psychologically important for me to know that there is no barriers to my wife leaving me, so that I am sure that the only reason we're together is because we want to be. We have joint assets, expenses and accounts, but we have an accounting of exactly how much is each of ours and it would take about 15 minutes to split everything fairly.

zinnie

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Re: Combining Finances after Marriage?
« Reply #6 on: January 21, 2014, 04:32:07 PM »
We decided to open a joint investment account together, which is where the majority of our monthly contributions go. IRAs/401Ks are obviously individual. And we both still have some leftover stock accounts that we don't contribute to anymore (and mostly just keep for fun). We have joint checking, and each kept our savings accounts to put aside money for small expenses (like saving for a car, or putting money aside for property taxes). These are the choices I felt comfortable with, as we are both on the same page with finances. If we weren't, or if he was a big spender, I'd likely want to keep some things more separate to control spending.




seattlecyclone

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Re: Combining Finances after Marriage?
« Reply #7 on: January 21, 2014, 04:37:46 PM »
I think joint accounts have made a lot of sense in my marriage. We live in a community property state, which means that legally speaking what's mine is hers and vice versa. We might as well have our bank accounts reflect that fact. Managing finances can be hard enough without having twice as many accounts to worry about! This structure allows us to do things that make the most sense for both of us put together, without worrying about one of us "owing" the other money for anything.

vespito

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Re: Combining Finances after Marriage?
« Reply #8 on: January 21, 2014, 04:48:35 PM »
We have 10 accounts and 3 budgets (hers, mine and joint along with savings and brokerage).  It sounds absurd, but it works for us.  My dw really wants to have her own money and wants me to have mine.  This way there are no judgements if she buys a new shirt or I buy a video game.  Of course, trying to FIRE in 10 years, I won't be buying much of anything but that's ok with me.

I have had plenty of people tell me that in marriage everything should be joint and if you can't do it that way you are doomed.  I disagree.  Please note, my wife and I both come from families where money arguments were the norm.  That doesn't happen in with us, because we decided to do what works best for us.
« Last Edit: January 22, 2014, 12:27:03 PM by vespito »

ace1224

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Re: Combining Finances after Marriage?
« Reply #9 on: January 21, 2014, 04:51:46 PM »
I'm not married but we've been together 11 years. We have a yours, mine, and ours. The paychecks get deposited into ours and then we get an allowance transfer to yours and mine every two weeks. Those are the accounts that we spend out of that the other person can't both about.  My bf loves to buy DVDs, I hate when he does it, as long as they don't come out of "our" money and just "his" I don't complain, same for my love of vampire smut novels.  All bills come out of ours.
All the retirement accounts are in my name only as they are funded by deductions from my paycheck before direct deposit.  I will be fully funding our retirement and I came to terms with that a long time ago

Emilyngh

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Re: Combining Finances after Marriage?
« Reply #10 on: January 21, 2014, 04:59:09 PM »
We have been married for 8 years and have everything combined except for one checking account each.

We are on the same basic page financially (neither are big spenders).   But, one thing that I found gave us both peace of mind is having a monthly allowance.   It's not large at all ($75 ea a month), but this is money that goes into each of our individual checking accounts that we spend without getting the other person's permission.   This actually started when DH would buy soda at a gas station and it would drive me crazy.   So, I figured that we would each get this same amount and use it for whatever we wanted, be it snacks or save it for something larger, and it brought me peace of mind.   Also, I have used mine to pay for the occasional piece of clothing, shoes, or haircut, and it's helped to keep me from feeling guilty about spending this money.

Other than that, everything is combined and very budgeted.   I have the only income (spouse is SAHP).   And as soon as the check's deposited it is immediately transferred to pay for all budgeted categories, bills, and savings.  So, having our small allowances enables us to have a little financial freedom, but still sock it away.   I also like the fact that the amount is exactly fair between the two of us, regardless of who brings in what income.

starbuck

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Re: Combining Finances after Marriage?
« Reply #11 on: January 21, 2014, 05:00:09 PM »
We've been together for 8 years, co-habiting for 7 years, and married for just over 2. (We also bought a house before marriage.) Our situation has evolved over that time, and we finally fully combined finances about 8 months ago. Our incomes have almost always been even (within a few hundred dollars) so we just split everything 50/50 - bills, groceries, down payment. I've nudged my spouse on things like retirement contributions, savings goals, things like that. We recently combined everything because there are some big changes coming our way (making humans, a career change) and I wanted to get the rough spots of combining finances ironed out now instead of when life got turned upside down and stressful. Like preventative financial maintenance, I guess.

Best advice I can give is talk about it early and often. Right now we have one joint checking/savings account (for household expenses, travel, pet care, etc), and separate checking/savings account for personal fun money. We talked about what we wanted to be funded from the joint account v. personal account (though there is flexibility.) I manage the accounts, and I usually mention how our financial house is doing over weekend breakfast. It can spark some good discussions and keeps my spouse in the loop, whether he wants to be or not.

I'm a big advocate of shared financial goals, but how you work the accounts and nitty gritty is 100% flexible. In 8 years, we've never had an argument about money. I honestly don't think we ever will. Do what works for you, and understand that what works this year might not work 10 years from now.

lizzzi

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Re: Combining Finances after Marriage?
« Reply #12 on: January 21, 2014, 05:03:37 PM »
Throw it into the pot and share and share alike.

CrochetStache

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Re: Combining Finances after Marriage?
« Reply #13 on: January 21, 2014, 05:25:24 PM »
Everything that can be in both our names is but I am the gatekeeper for 100% of our finances.
He went away on deployment right after we got married so the family finances fell to me to handle and it simply has been that way even though he is no longer in that job.

He has good spending/saving habits but simply has zero interest in handling it in any way whatsoever. He has never taken the reins with any of it.
It works for us, married for 12 years, no money arguments.

Each couple will do what works best for them, do what works best for you two.

golfer44

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Re: Combining Finances after Marriage?
« Reply #14 on: January 21, 2014, 05:43:16 PM »
This will all change when we eventually get a place together, simply because a home purchase far surpasses the threshold either of us could handle individually

Just a quick thought, and I may be taking liberties with my assumptions, but does that mean that it takes both of you to afford the house you'll be buying? It'll only take one of you losing your job or having something else happen to totally derail that train.

Or, get one that one of you can completely float, and that way if either one of you loses your job/ability to earn income, you won't be hosed on the house.

Just a thought!

BlueMR2

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Re: Combining Finances after Marriage?
« Reply #15 on: January 21, 2014, 05:47:07 PM »
Getting married in our late 30's, we already had all our own stuff and own bank accounts.  Seemed rather silly to combine them and have to change everything around when we were perfectly happy with the way they were already setup.  We're both POD on the other's accounts of course, but other than that we don't go out of our way to mingle our money.  Why make life complicated?  Just use your own money as needed...

The Fake Cheap

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Re: Combining Finances after Marriage?
« Reply #16 on: January 21, 2014, 06:11:00 PM »
My wife and I each have our own separate bank accounts, with one joint account for ease of transferring funds.  We just figured it would be easiest to keep track of things this way, and it has been easy for us.  At the end of each month we just do one simple transaction to make sure bills are split 50/50 (or at least roughly 50/50).  I find this way works best for us, and know of others who do similar, I also know others who have gone the joint route and that works for them.  I would be happy to provide more details about our system if that would help you out. 

Ohio Teacher

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Re: Combining Finances after Marriage?
« Reply #17 on: January 21, 2014, 07:16:02 PM »
We opened a joint checking shortly before we were married and that's where both of our paychecks go and all bills are paid from.  I come from the mindset that what's mine is hers and vice versa.  I handle all of the finances and set up her 401K up to the company match and max out her Roth IRA.  She trusts me to manage our finances and I give her updates on Mint every couple months.  Everything we do is transparent to one another.   I will never personally understand married couples keeping separate money but to each their own and it may work for you.

Zikoris

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Re: Combining Finances after Marriage?
« Reply #18 on: January 21, 2014, 07:23:08 PM »
Not married, but living together for several years. We have separate bank accounts and investment accounts, but joint credit cards. Neither of us has ever had any desire to open joint bank accounts.

Our banks allow for free instant e-transfers, which he uses once a month to transfer his rent money to me, and other things (reimbursements for medical claims mostly).

All our expenses go on the credit cards, which we tally up and fully pay off twice a month. Mint helps a lot here.

Joint expenses are split 50/50, and we pay 100% of our individual expenses. As far as I'm concerned, these numbers are absolute - none of the percentage-by-income stuff for us. We spend very little, so we both still have tons of money left over.

Mlkmn

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Re: Combining Finances after Marriage?
« Reply #19 on: January 21, 2014, 10:26:01 PM »
We combined everything when we got married and do not have a prenup. We are 5 years in and love and respect each other more than ever, so neither of us is getting off the train until the end, however long that may be. 100% commitment from both of us.

lizfish

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Re: Combining Finances after Marriage?
« Reply #20 on: January 22, 2014, 01:56:51 AM »
We have been together for 12 years. 2 apart, co-habited for about 7 then married for 3. We've had a joint account for mortgage bills groceries etc since we started living together as well as joint savings for holidays, the wedding etc. But even now we keep separate current accounts and savings where our salary/income gets paid in, and then we each pay a set amount to the joint account each month for the running of the house. I budget on YNAB for myself and for the joint account, my DH has his own system which works for him.

In the last year we discovered MMM and I also inherited a reasonable amount and both of these things have pulled our focus much more towards 'our money' than his or her money. So we both contribute to overpaying the mortgage where we can. we are both building our 'staches but we are building our 'stache, just in two different places (it's tax sheltered so needs to be separate anyway in the UK). Most of my inheritance went to pay off a mortgage and save for an extension because that is our choice. And should my DH ever come into money he would no doubt do the same. We are both similar in spending habits, thankfully.

Interestingly the proportion has been 1/3:2/3 for contribution to the joint finances (proportion by income I guess) again that wouldn't work for everyone, but it did for us. It's gone fuzzy now we are saving more and I wasn't contributing as much for quite a while through non-employment and self-employment.

mrgrump

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Re: Combining Finances after Marriage?
« Reply #21 on: January 22, 2014, 02:32:33 AM »
I don't really understand the separate finances mumbo jumbo. If you have 2 kids will she raise 1 and you the other? You got married for life, like someone else said, what's yours is hers and vice versa. All the bills and all the savings. We have 1 checking account and 3 savings accounts. 1 for rainy day and 1 savings account each. The only money that is truly "separate" in our house is gift money which we can spend as we see fit. All other finances are discussed. Yeah we each buy things we want and don't ask the other person but most of the time those are under $20 and evenly spread out. A prenup? Maybe makes sense if you are brad Pitt and Angelina but come on. Setting this up to divide a couple 100k. I got a thought instead of worrying how things will end work and work so that it doesn't end. If you think it will, maybe you should rethink that marriage date.

However if separate works for you then great. I just don't understand the concept. You love the person. Trust them in your house, to raise your kids, with your family. But not your money? To me money is #4 on that list ...

I sound like some old dude in that rant....so for clarity I am 27 and we have been married just over 4 years. If our marriage fails it should be hard to separate on every front, then maybe we will work a little harder so it doesn't.
« Last Edit: January 22, 2014, 02:34:56 AM by mrgrump »

Osprey

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Re: Combining Finances after Marriage?
« Reply #22 on: January 22, 2014, 04:54:56 AM »
Caution: Inexperienced unmarried-but-living-in-sin here!

I'm hoping to do an antenuptual, possibly continue to have separate finances but list each other as beneficiaries and have an "ours" account and joint mortgage, for the following reasons:

1. One partner can be protected from taking on the other partner's debt, and so will be able to help out if things go really pear shaped. Obviously we're not planning for me to become a gambling addict or something, but "hope for the best, prepare for the worst" and all that.

2. Since our portfolios are completely different, we won't have all our eggs in one basket

3. We have very different money management styles and risk tolerance, so if we combined finances we would drive each other crazy

4. I was brought up never to rely on a man... I realise that as a woman who is planning to have children I am likely to lose out big time by not doing community of property. But eh.

Maybe some of the commenters can explain further, becasue I'm not sure how this has anything to do with commitment - the whole point is to make these decisions in a sensible setting, in order to prevent having to make them when emotions are heightened.

nottoolatetostart

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Re: Combining Finances after Marriage?
« Reply #23 on: January 22, 2014, 04:56:35 AM »
Been married for 4 years. We combined everything that we started earning as of our wedding day. No prenup. Paychecks go into a joint checking account, our investments are in a joint account, we own our house together, etc. I brought student loans to the marriage and he had some brokerage accounts - so obviously it was not equal. We were 30 when we got married. He has a separate "fun money" account so he can buy his running shoes, sodas, etc. without me getting annoyed. It's a minor amount, but it helps keep the peace since he is not so Mustachian (yet). We paid off my SL's together with our income (luckily my SL's gave me a very well paying job that I still to do this day - his view was paying off the SL's will take less than 1 year, but that's nothing out of a 50-60 year marriage). He has kept his own savings separate from our finances so it is not considered "ours" since his parents gifted him some of that money.

Everything we have earned since our wedding day is considered ours. I don't understand separate finances....are you together or not? Are you planning on leaving already? Why even get married?

It would be bad ass backwards to try to get to FI if we had separate finances. It's our life together. We are 100% committed until death do us part. We have friends that keep separate finances and for us, I think it helps us get further ahead with FI doing this together. If we were to ever split, our assets earned since marriage would be split down the middle (I could probably get you an exact balance from YNAB because we only started comingling right after we got back from the honeymoon), but would be so heartbroken that I would not care about the money. I know he feels the same way. We are in it to win it.

mrgrump

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Re: Combining Finances after Marriage?
« Reply #24 on: January 22, 2014, 05:33:50 AM »
Osprey - un-married is the key word in your post. I agree keeping everything separate in your case. Post marriage you don't get, IMHO, to take the easy way out if it fails. You took that pledge for life not until one gets gambling debt or a third eye. If either of you loses everything in their investments does the other one get to retire because "that was their money, not mine" like you said if you split expenses equally and  you make a ton more than him can you go buy a beach front condo as he wallows away working trying to keep up with your lifestyle. You also mention protecting yourself against the other. If you need to protect financially or otherwise yourself against your husband/wife, it doesn't sound like marriage will be succesful anyways. Having your money together doesn't mean you rely on one person, it forces you to make decisions together.

I don't mean to pick on you osprey but the comment about not relying on a man burned me up. The reason being if you can't rely on someone (man or woman) why would you marry them or even befriend them?

According to websters the definition of trust is "belief that someone or something is reliable, good, honest, effective."
« Last Edit: January 22, 2014, 05:55:34 AM by mrgrump »

cynthia1848

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Re: Combining Finances after Marriage?
« Reply #25 on: January 22, 2014, 07:42:29 AM »
We combined finances before we got married by opening a joint account.  We never did percentages of who paid for what, etc. - everything came out of the joint account.  When we got married and changed our names then it was easier to joint up everything else - we have shared credit cards, investment accounts, everything except retirement accounts (which have to be kept in individual name).  No prenup either - we are joint on everything.

I think it helped that for a while I was a student while he was working, then I made more than he did, then I made way more, then he made a little more, now he makes way more, so we've both been the higher-earning and lower-earning spouse.

ThatsMyOtter

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Re: Combining Finances after Marriage?
« Reply #26 on: January 22, 2014, 07:52:08 AM »
We combined finances when we got married. About a month before the wedding we listed our incomes, assets, and liabilities and used that information to build our budget. We turned my checking/savings into a joint account. All income goes into that account. We pay for joint expenses (food, shelter, utilities, medical, insurance, transportation, necessary clothing) and save for emergency fund and down payment for a house with those accounts. We also get a cash allowance to use for anything else we want. If we want to go on vacation, buy new furniture, etc., we save together from our allowance.

DH loves to keep track of our expenses and gives me a monthly update. I work on turning our financial dreams into plans we can act on and track-e.g., we need to save $xxx per month so that we can put 20% down on a house. This way we both contribute to our financial decision making and goal setting but we can each do the part that we enjoy.

tpozywio

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Re: Combining Finances after Marriage?
« Reply #27 on: January 22, 2014, 08:02:12 AM »
Wife and I have "separate" checking accounts but were both on each others.   I find it easier to track how much I spend that way.   On investment accounts its "mine" bc if i die she'll get it all anyways.   I don't think it makes any difference on taxes to do it that way

thepokercab

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Re: Combining Finances after Marriage?
« Reply #28 on: January 22, 2014, 08:42:36 AM »
Its probably easier to combine finances when both parties are starting near zero.  My DW and I got married at 22 and had maybe a few bucks to our collective names. We were pretty much married out college, so we really didn't start the whole concept of savings or budgeting until after we got married.  So it was pretty easy for use to just open a joint checking/savings account, and then later on a joint investment account. 

If we gotten married later, had more assets, and started developing our own personal preferences, we might have ended up with separate accounts and budgets- so I can see why that ends up working for folks.  But I think since we started with zero, and hadn't really dealt with money before, and hadn't fully developed separate habits on spending and saving, it was easier to just combine the whole picture when we got married. 

MustachianAccountant

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Re: Combining Finances after Marriage?
« Reply #29 on: January 22, 2014, 09:09:42 AM »
+1 to what Emilyngh said. It's what we do, and it works great.

rockstache

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Re: Combining Finances after Marriage?
« Reply #30 on: January 22, 2014, 09:37:20 AM »
We got married in our late 20s and at that time each had our own accounts, but opened up a joint one. Since then, we have gradually closed one of the old accounts, and gotten separate credit cards (for points and also to give ourselves a certain amount of spending money independent of the other). Everything gets paid from the joint account, and all income goes there before heading off to it's designated location. We have no prenup. I handle all of the finances and update dh on a semi-regular basis as to where things stand.

dude

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Re: Combining Finances after Marriage?
« Reply #31 on: January 22, 2014, 09:41:32 AM »
My wife and I each have our own separate bank accounts, with one joint account for ease of transferring funds.  We just figured it would be easiest to keep track of things this way, and it has been easy for us.  At the end of each month we just do one simple transaction to make sure bills are split 50/50 (or at least roughly 50/50).  I find this way works best for us, and know of others who do similar, I also know others who have gone the joint route and that works for them.  I would be happy to provide more details about our system if that would help you out.

Similar arrangement here.  We dated for 16 years prior to marrying some 7+ years ago, so had separate accounts for a long time prior to marriage.  We have one joint savings account.  I direct deposit her enough of my paycheck to cover my portion of the regular monthly bills (2/3, based on our disparate incomes) and a surplus for savings.  It's worked fine.

Though we have talked about combining everything into a joint account recently -- mostly to keep each other in check on our individual discretionary spending, so we can increase our savings rate.

Psychstache

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Re: Combining Finances after Marriage?
« Reply #32 on: January 22, 2014, 09:46:24 AM »
My wife and I met in grad school several years ago and got married in June 2013(note: we live in CP state).

Originally, the plan was:

checking accounts, his, hers, and ours.
   a small allowance ($200) went into our individual checking and everything else went into the join account.

When we had our state of the family meeting in Jan, we realized that we never really spend our allowances and we have money piling up in there earning nothing (our join checking gets 2.5%). We also had the problem when we would spend money on ourselves, I always wanted to put it on a credit card for however many points we could get (and all the CCs get paid out of the join account).

One of our actions steps from the SotF is to kill the direct deposit to our personal accounts and then close them and just have one big pot.

For investing, we cashed out all of our (non-retirement) investments and used some of that money for a down payment on our house. We took what was left after close and moving expenses and opened a joint taxable account.

It works for us really well because we have a very strong "our money to build our life together" philosophy. It it probably easier since we make about the same amount of money, but she is clearly the bigger person about it since she brought a ton of investments into the marriage and i brought a ton of student loans in (which she has repeatedly talked about as "our debt")


P.S.Before we were everything was separate and split down the middle. An annoying but prudent precaution.

rubybeth

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Re: Combining Finances after Marriage?
« Reply #33 on: January 22, 2014, 10:00:11 AM »
Married over 5 years. Joint checking (brokerage) account, all income gets deposited there. We used to have separate checking accounts and he'd pay for some bills while I paid for others. It got kind of silly after a while, especially when we started making more money (we were students when we got married). We have shared financial goals, so joint accounts make sense. If we had different goals, separate accounts might work better. We used to budget more for "fun money" each month, but we stopped doing that a while ago. If one of us wants to spend more than about $100 on something that won't directly benefit the other person, we talk about it (the main example that comes to mind: camping equipment for him since I don't camp).

I think you should figure out where you're both spending your money, though. Something like Mint would let you see all of the accounts and spending in one place without actually combining finances or opening any new accounts.

sleepyguy

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Re: Combining Finances after Marriage?
« Reply #34 on: January 22, 2014, 10:12:44 AM »
Since you're "in for life" i agree the should be combined.  We're not married and we have combined everything.  SO MUCH easier managing investments, what goes in/out and just basically keeping track of things.

CommonCents

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Re: Combining Finances after Marriage?
« Reply #35 on: January 22, 2014, 12:53:54 PM »
Start a poll?  I bet responses will vary quite a bit based on age of the respondents when they got married.

We got married later, in early (me)/mid (him) thirties.  Both had grad degrees but the government kindly paid for his plus a stipend, so he came in with a lot more assets than I did.  He also had an "early inheritance" as he called it from his mom in the form of significant assistance buying his condo.  I told him I was ok with a prenup, as long as it was fair (in that if one of us - more likely me - took time off to take care of kids, that I would be protected, and that any money I eventually received from my parents would be just as protected as money he had received from his mom).  Despite the over half a million discrepancy in assets, he chose not to ask for a prenup. 

We have different investing strategies and we both preferred keeping our own banks we were already using.  So we added each other to our accounts and continued as we did before.  (It was actually a bit of a frustration to get me added to his bank account because we had to take his brother off first, who was on as a holdover from his childhood.  *That* particularly bothered me, even if he was "sure" his brother would hand over any money in it to me and he did, it could exceed a permissible tax-free gift.)

We'll likely reassess if/when we have kids and they have more expenses, but for now we just talk about things as they come up.  No calculation by salaries, but if I say I just paid a lot for [house repair, medical bill, etc.] he'll ask if I need money and tell me to take it from his account if need be.  We linked the accounts to push money more easily.

Luckily, in the grand scheme of things, we're generally on the same wavelength on spending money.

Really all that matters is that you talk through the options and you are both on the same page.  There's no "right" way to do it.

Workinghard

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Re: Combining Finances after Marriage?
« Reply #36 on: January 22, 2014, 01:43:04 PM »
We were older when we got married and had separate accounts for about 7 years. It took awhile before I trusted my dh after finding out he had debt--a year after our marriage.  That was 21 years ago.  Both of us are hourly wage earners and OT belongs to the person earning it. I usually save mine or throw it into our sinking car fund. My dh will put some in the car fund but also use it for gifts that are more than I would give. For example, he gave his sisters $200 each at Christmas instead of the $100 I would have given them. 

nawhite

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Re: Combining Finances after Marriage?
« Reply #37 on: January 22, 2014, 02:10:41 PM »
So this is totally illogical and insanel, but it's psychologically important for me to know that there is no barriers to my wife leaving me, so that I am sure that the only reason we're together is because we want to be. We have joint assets, expenses and accounts, but we have an accounting of exactly how much is each of ours and it would take about 15 minutes to split everything fairly.

I make significantly more than my wife (and I brought much less debt to the marriage) and we decided to go joint finances without a pre-nup, just a verbal agreement that our student loans were our own responsibility in case of a split. About a year into the marriage, we wanted to change banks (both of ours were instituting new monthly fees) so we just decided to combine checking and savings accounts when we joined the new bank.

There are definitely a lot of pros to combined finances but it only really works because we are very much on the same page mustacianism-wise and she trusts me to manage all finances entirely. That trust makes me feel a lot better about not having a pre-nup but in hindsight I wish we had one for the reasons StetsTerhune lists. YMMV but have the conversation about a pre-nup. No matter what anyone here or your spouse or family thinks, having a pre-nup is a mature recognition that "the best laid plans of mice and men often go astray" including 50% of all marriages in the US.

I'll probably get a lot of flak for this, but in my opinion (even from years of experience in an extremely happy marriage), not having a pre-nup is a symptom of financial immaturity. State laws about divorce don't make everyone happy just like state laws about estate transferal on death don't make everyone happy. You should have a pre-nup for the same reasons you should have a will.

dbanta

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Re: Combining Finances after Marriage?
« Reply #38 on: January 22, 2014, 02:36:05 PM »
We moved in together 2 years ago and married 1 year ago. 

When we moved in together we realized that some purchases (food, utilities, etc.) would now be shared.  We opened up a joint checking account and changed our direct deposits from work to put equivalent amounts into this joint account and then whatever remains from our paychecks into our individual accounts.  We use this account for groceries and all shared bills. 

We are both on the same page on budgeting and have the same amount for our fun budget each month (spend $x anyway we want).  But having separate accounts can be nice if I have a larger purchase I need to make.  For instance I grew up in NJ and would like to visit my lifelong friends at least once a year from CO so I can use money from my sole checking account for things like that.  Or if I want to take my husband out to dinner or vice versa, we can do this from our solo accounts which makes it still seem like we are kinda dating instead of taking away from our general fund.

We have not yet discussed combining our investments and have just started doing some research into what might be the best approach.

All I can say is that I like keeping money in our separate accounts and having the joint account for bills.

Megatron

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Re: Combining Finances after Marriage?
« Reply #39 on: January 22, 2014, 02:48:14 PM »
Wow, thanks for all the insightful replies. I didn't expect that many contributions after a day. Looks like a popular subject and it looks like the answers varies also. Like most of you said, do what I think would work best in my situation. I think we are going to combine finances after marriage because I think it just feels simpler to pay everything from the same accounts. That way we know exactly how much is going in and out.

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Re: Combining Finances after Marriage?
« Reply #40 on: January 22, 2014, 02:50:08 PM »
We have been married for almost 18 years, and I have always earned significantly more than my husband.  He brought a mortgage to the marriage and I brought no debt.  Luckily our outlook on personal finances is very closely aligned, and we have never taken on additional debt along with ridding ourselves of the mortgage, saving aggressively, etc.  Everything is in joint accounts that can be (401Ks, etc. cannot be, but we are each others' beneficiaries).  I am more active at managing to the budget, and he is more active on the investment side.  It has worked out well so far.  In the event of a divorce I would probably stand to lose a bit more than him because I have contributed more, but it's not worth the headache of managing things separately to protect myself. Maybe that is naive, but that's my current perspective.

Thegoblinchief

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Re: Combining Finances after Marriage?
« Reply #41 on: January 22, 2014, 03:13:51 PM »
Read most of the replies.

My wife and I are almost entirely joint accounts, except (obviously) 401(k) accounts. We combined our accounts as soon as she moved here, before we were even married, partly because she's not the greatest at keeping books. All of our income, regular and bonus, goes into the joint account.

Gift money and the small amount of money we generate from our side businesses is our "play" money. Having a little bit of play money helps alleviate tension. In general I've been the more frugal one, but we've each had our spendthrift moments before I discovered MMM.

She lets me handle all of the budget and spending, since I'm home with the kids most of the time, but I always remind her that she can ask me anytime how we're doing, what we're saving for next, etc.

livetogive

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Re: Combining Finances after Marriage?
« Reply #42 on: January 22, 2014, 03:19:33 PM »
We combined our finances in combination with a budget and I couldn't be happier about it.  It reduces potential resentment and fights by about 403975839% because it no longer matters who pays for what.  For example, I have a credit card with 3% gas rewards.  That is now our universal gas card. 

Also it prevents either of you from feeling "flush" one day and being spendy or feeling like you're the only one who saves while the other person is gets spendy.  Finally, the convenience is huge.  I can pay the bills or if I'm away for work, she can pay the bills and neither one has to transfer money to the other.

In many states the whole separate finances thing isn't relevant in a divorce anyway.

KMMK

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Re: Combining Finances after Marriage?
« Reply #43 on: January 22, 2014, 04:58:52 PM »
I'll have combined finances as soon as there's a magic potion to make my husband understand that I am always right, all the time. Until then I'm taking care of my own money and he can do whatever.

Seriously, for us it's not spending that's the issue. But we completely disagree about investing. We agree to separate before we got married as we each prefer to manage our own money. Couldn't have it any other way.

HappierAtHome

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Re: Combining Finances after Marriage?
« Reply #44 on: January 22, 2014, 05:20:43 PM »
I think marriages, like personalities, come in all different shapes, sizes and colours, and you need to find what works for you.

Not yet technically married, but for me, finances being separate or joined isn't down to trust or commitment. It's rare that I would spend even $1 without my partner knowing, we both know the other's exact salary, bank balances etc and trust each other to the moon and back. We work towards the same goals, we just happen to have separate accounts (though we have talked about joint accounts when we buy a house together). In fact, if you need to have joint finances to control your partner's spending or to know what they're doing... that's a situation I'd be worried about.

I think the most important thing is to talk, talk and talk some more with your partner about money and how you want to handle it. Lack of communication is the killer.

mlipps

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Re: Combining Finances after Marriage?
« Reply #45 on: January 22, 2014, 05:50:57 PM »
Husband and I combined finances after 4 months of dating when we moved in together. Trust? We got it haha. Seriously though, it's worked fine for us. I'm definitely a spender by nature, but having "our" money instead of "my" money helps me rein things in. He still has one old checking account & credit card that I don't have my name on, but that's mainly out of laziness. Plus, gifts are my "love language" so this lets him splurge and surprise me on occasion. We haven't put any additional money in there in ages, he just has a little stock pile.

As far as investment accounts go, we don't have a taxable account (yet!) but I assume that would be joint as well. All of our credit cards are individual, but I made him an authorized user on a few with better rewards. Since I just use bill pay from our joint account to pay those & track them all on Personal Capital, I don't really care whose name they're in.

eman resu

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Re: Combining Finances after Marriage?
« Reply #46 on: January 22, 2014, 06:10:16 PM »
I think the most important thing is to talk, talk and talk some more with your partner about money and how you want to handle it. Lack of communication is the killer.

+1. 

Congrats on the upcoming marriage. Keep in mind that there are permutations of "separate" and "joint".  Access and ownership don't have to go hand-in-hand necessarily.   

My wife and I have been goin' steady since we were teens. Haven't deposited a not-for-retirement dollar into anything but a joint account with her since I was 18 (that was, erm, some time ago).  It works for us... and has nothing to do with what will or won't work for you two.  Good luck and congrats again!

 

AccidentalMiser

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Re: Combining Finances after Marriage?
« Reply #47 on: January 22, 2014, 06:41:18 PM »
DW and I got married when we were 19 after growing up together.  I joined the Navy four days later.  We only had my income up until about 2.5 years ago, once the children got near the end of high school.

We were flat broke when we got married and went downhill from there.  We're better now, but we've always seen our money as ours. 

As with most things, managing expectations is the key to happiness.  I appreciate the accountability that comes from having joint accounts.  Having said that, my DW is completely trustworthy, transparent and frugal.  If something were to happen and I were to get re-married (shudder), I wouldn't combine accounts until I KNEW what I was getting in to. 

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Re: Combining Finances after Marriage?
« Reply #48 on: January 22, 2014, 11:23:54 PM »
Osprey - un-married is the key word in your post. I agree keeping everything separate in your case. Post marriage you don't get, IMHO, to take the easy way out if it fails. You took that pledge for life not until one gets gambling debt or a third eye. If either of you loses everything in their investments does the other one get to retire because "that was their money, not mine" like you said if you split expenses equally and  you make a ton more than him can you go buy a beach front condo as he wallows away working trying to keep up with your lifestyle. You also mention protecting yourself against the other. If you need to protect financially or otherwise yourself against your husband/wife, it doesn't sound like marriage will be succesful anyways. Having your money together doesn't mean you rely on one person, it forces you to make decisions together.

I don't mean to pick on you osprey but the comment about not relying on a man burned me up. The reason being if you can't rely on someone (man or woman) why would you marry them or even befriend them?

According to websters the definition of trust is "belief that someone or something is reliable, good, honest, effective."

Hmm. I think I may have miscommunicated.

- If I get into gambling debt (substitute any other near-catastrophic financial event, like medical expenses for a debilitating illness) then the enitre point is that my partner will stay and look after me voluntarily, not that he'll leave! But he will have the advantage of not being financially crippled.

- As a corollary, if one of us does really well in investments then it will take the pressure off the other, maybe allowing them job flexibility. And we trust each other to support our personal dreams, and not be resentful or have a shitty attitude about it.

- Lastly, I'm sorry for being so callous in the comment about not realying on a man. Statistics show that I will earn less than him but I'm choosing to do my own thing financially -  this means a lot to me in terms of independence - because I trust that he will not be squirelling away $$ into a secret account, and I know that he'll always have my back.

The fact is that we're committed to each other for life, married or not, and we trust each other to share the love (and $$) without it being a legal obligation. However, we're trying to use the legal stuff to our best advantage and to be honest we've been doing it this way for so long, why fix it if ti ain't broke.

LauraG

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Re: Combining Finances after Marriage?
« Reply #49 on: January 23, 2014, 07:04:54 PM »
My partner and I have been together for about 6 years and legally married for about half a year. We maintain separate accounts, because (1) it's easier than switching everything (I'm in my 30s and my partner is older), (2) we have established separate styles for managing cash flow and investments, and (3) it gives us daily security / reinforcement that if something happened to one of us the other could still manage. I particularly don't want my partner to end up like my mother, who relied in my father to manage evertything and would now be financially lost if my father predeceases her.