My wife and I don’t like to argue… unless it’s about where to eat. We try our best to be different than the other couples we know and not argue about money… ever. For the most part it works. We rarely are stressed over money and are on the same page with our goals. The Mrs. isn’t as big a fan of talking finances or planning with specifics. She has goals and things she’d like us to be able to do or afford, and I execute those plans and goals. I run the numbers, and tell her what I am thinking and we get on board together. Combining finances make this easier for us to manage our money.
Maybe it’s just our chemistry or who we are but we’ve always trusted each other’s money skills and habits. Mrs. TeachMoney is more spontaneous than I am when it comes to plans and spending. But this hasn’t hurt us even in the slightest. We have room in our budget for spontaneity and fun. And when it’s a big expense, we always find a way to make it up by cutting spending elsewhere or making a bit more money to pay ourselves back.
Since we started dating in 2011, we have only had one time that we stressed over money. That was the summer of 2017. We had a big year of spending as we had moved into our home, graduated from graduate school, got married, and went on our honeymoon.
Anyway, we had changed my pay structure and didn’t receive a summer check in June to help get through the summer. Instead we planned to rely on our small savings (less than $5,000), Mrs. TeachMoney’s full time job at a daycare and my summer school paycheck ($3,000 for 7 weeks after taxes). It wasn’t that we couldn’t afford our bills or to go on vacation (we did). It was just tighter than we expected and wanted. My plans (usually airtight) had two big miscalculations. I had failed to accurately predict our tax refund (there wasn’t one) and had mistakenly thought I got paid the second week I returned to school in the Fall (it was actually 3 weeks and only a half a normal check).
This summer was stressful but the rest of the time, we have been in financial bliss. Never flush with cash or abundantly saving money, but never stressed out and fighting. Our secret to managing our money as a couple has always been to combine everything.
Combining finances as a couple
So, we have a crazy story where we had basically pooled our combined income and savings since 2013 (our junior year of college). We were living together and split our bills, but neither of us cared who actually paid for what and how much. We used each other’s money pretty much interchangeably. This worked great for us. We trusted each other and learned to talk about money. We officially combined our accounts when we got officially married and started putting all our income in the same accounts.
Now, obviously, this isn’t the best advice for every couple just starting out. I would never recommend “pooling” all your money when you are just dating. But, once engaged, if you know, then it isn’t a bad idea to start doing more money management together.
Our friends on the other hand never combined their finances even after getting married. They kept separate accounts but had combined goals (FIRE & travel). When it came time to manage money together, they just didn’t. They kept it separate. And it divided them.
Dividing up financial responsibilities as a way to manage money didn’t work well for them. When they bought a house together, they divided up who would pay what and so each had different responsibilities. This created a situation where one was paying only on debts that was their own (student loans and car) and the other was paying all the other bills and debts they had together. They kept separate savings accounts as well. Long story short, it didn’t end well.
Money became a stressor. And as their marriage started to fall apart, the fighting over who pays for groceries, and over every little bill that they previously thought they had planned out. As they were going through the divorce process, the whole situation became very challenging as they both claimed the other hadn’t paid their responsibilities.
From my perspective, the fact they didn’t combine finances led to the issues they faced together and the stress on the relationship. It’s important that in a relationship both parts manage money, but that you do it together.
For others, separate finance could be beneficial and work well for them. However, for my wife and I, we have not seen people succeed that way and we have had success with combined finances.