How to Combine Finances without Dividing & Conquering Your Relationship

Congrats, you’ve found the one for you! Now let’s talk money. Whether you’ve decided to keep separate accounts, a joint account or three accounts (yours, his/hers and ours), at some point or another, your pennies shall entwine. Before you’re a dollar too late, it’s pennywise to have a plan in place for combining your marital finances.

Step 1. Communicate!

Without a doubt, the first step in mapping out your joint financial future is communicating your financial goals. Be it short-term (like, paying for your honeymoon) or long-term (having a baby), the two of you need to determine what goals are priorities for both of you.

Step 2. Create a budget…together

When it comes to expenditures, your spouse’s latte habit is your latte habit. Vexing, yes. But true. Since you’re in the swing of things communication-wise, now is a good time to create a joint budget. You can designate one spouse to be in charge of managing the budget, or take turns. Either way, it’s up to both of you to maintain and respect that budget.

Step 3. Decide: he/she banks with me…he/she banks with me not?

Either you treasure your financial autonomy or don’t mind being held accountable to a joint bank account. At some point, you’ll have to decide which side of the ledger you and your spouse are on. At the very least, a joint account ensures easier record keeping and lower maintenance fees. It can also serve as a pool for paying household expenses. After all, what’s mine is yours…including the cable bill.

Step 4. Ask yourselves: whose credit is this anyway?

While opening a joint bank account might not be a bad idea, joint credit cards usually are. Let’s say one of you has poor credit. A joint card will drag you both down, which could hijack your joint goals down the line. Give your spouse time to improve or establish his/her credit score; meanwhile, you can authorize your spouse on your credit card, but remember that you are ultimately responsible for it. 

Step 5. Sort out insurance matters

Do a price comparison of one another’s health plans to determine which offers the best coverage for both of you. Examine your auto insurance coverage, too. If each of you has your own car, pooling auto insurance policies with one company could come with an attractive discount. Not as attractive as you know who…but cute.

Step 6. Remember: the couple that saves together retires together

You’re in this relationship for the long haul, meaning both of you will want to stop working one day. When that happens, you’ll want to be on the same track retirement-wise. If one or both of you are taking advantage of your company’s retirement plan, familiarize yourself with each benefit’s characteristics, including matching contributions, vesting and investment options. Oh, and speaking about retirement…how’s that estate planning coming along? If it’s not, read on.