One of the biggest issues couples fight about is money. Many problems can occur as a result of you and your partner not being on the same page about finances. In fact, a 2012 study found the couples who argued about money early in their relationship were most likely to get divorced.1
My boyfriend and I have been together about 7 years, and we’ve been living together for 5. We don’t share any bank accounts and we each pay a share of the bills. We use an app called Splitwise to tally up how much we owe each other, and then we pay each other up about once a month. We’ve discussed that if we got married we would still maintain separate accounts. But might have a joint account for common household expenses.
I’m not saying we are doing things right and that couples who share finances are doing things wrong. But I do think each member of a couple having money of their own could get rid of some stress. Ideally, couples can handle finances one of a few ways:
- Completely pooling all money. All bills would be paid out of the shared accounts. I think this method will only work if both members of the couple have a similar belief system about finances. If one person is frugal and the other spends everything they make, sharing finances is not ideal. But when one member of the couple is working and the other is a Stay-at-Home parent, there is no way to avoid using this method. The Stay-At-Home parent is contributing to the household (just not financially) and needs access to the money.
- Maintaining completely separate accounts. I recommend this method for a couple that hasn’t been together long. If you don’t know your partner well, you shouldn’t share financial accounts with them. You can each pay an equal share of all bills, or you can divide them proportional to income. If one person makes $30,000 a year and the other makes $70,000, it’s really not fair for the person earning less to pay half of the rent/mortgage. It would be more reasonable for the person making $30,000 per year to pay 30% of the rent, and the person making $70,000 a year to pay 70% of the rent.
- Maintaining joint accounts and separate accounts. This is my preferred method of handling finances, though it may not work for all couples.
You could set up option 3 from above in different ways. One of the easiest and fairest ways to do this is to add up all monthly shared expenses. This would include rent/mortgage, food, utilities, etc. Then each member of the couple could contribute an amount based on their income.
For illustration purposes, let’s look at a couple where one person takes home $3,000 a month and the other takes home $7,000 a month. Their combined income is $10,000 a month. Let’s say they have household expenses of $5,000 per month. Each of them should contribute a proportionate amount of that $5,000. In this case, it’s easy to figure out how much that is. If the combined income is $10,000 per month and the household expenses are $5,000, the household expenses are 50% of their total income. So, they should each pay 50% of their income.
Then, the person taking home $3,000 per month should pay $1,500. And the person taking home $7,000 per month should pay $3,500. And they can each do what they want with their remaining take-home income.
Using this strategy won’t get rid of all financial arguments. But anything that will get rid of any strife between couples is worth considering.