Eyes Wide Open: Avoiding Joint Disaster


Relationships and Money

Money And Relationships


How do you manage money with a partner?  If you’re in a relationship, is it better to have a joint checking account or keep all finances separate?


I don’t know about you, but I’ve always found it interesting to learn how people handle their money.  For most of the couples I know, it seems one partner has either taken charge or assumed most of the responsibility for the finances.  In my household, either of us could do it, but if we did it together we would probably have a lot more cause for conflict—in our case it wouldn’t be as much from how we spend, but how we track our money.


Which way to go?  Joint or individual?

Do you have joint bank accounts, joint plus individual or individual accounts?

For new couples, a discussion whether to mingle funds or keep them separate can end up a trying ordeal and require some serious negotiation.  If you’ve lived by yourself for any length of time, you may have a very specific method for tracking your funds.  You may also like the sense of control you get when there are no other people to answer to on matters of spending.  Still, as you come together as a couple, or if you’re trying to re-engineer a floundering relationship, the decision over who tracks the money and how you each of you spend it can be critically important to your long-term success and happiness.


No Perfect Solution


So what’s the best way to manage your personal finances? For some, separate accounts and separate tracking are the only way to go.  Others will want to co-mingle funds and manage it together.  And then there’s a whole range of people in between.  Couples may want one or more joint accounts, one or more individual accounts, have one person in charge of the finances, or maybe figure out a schedule to rotate the duties.  In short, anything goes.


Now, just because different people will want to do things differently doesn’t mean it’s a topic of conversation that should be off limits.  In fact, the more thought you put into your personal financial situation and the more you try to communicate your concerns, the better chance you’ll both end up meeting joint or individual financial goals.


Problems Will Arise


Are you fighthing with your partner?

Is money coming between you and your partner?

When it comes to two people coming together money has the potential for creating a lot of heartache.  Problems in a couple’s financial situation may crop up for a variety of reasons.  Here are some questions to discuss.


(1) The failure to communicate. When you don’t tell your partner what you need or want they have to guess.  It’s easy to guess wrong.  Are you holding something back?

(2) Overspending. If you haven’t made a point to sit down and come up with a workable budget how do you know how much you can spend on certain things or what portion of your income should go to savings or to joint expenses?

(3) Inadequate savings. If there are limited savings and one of you loses a job or a portion of your income are there funds in place to cover the shortfall?

(4) Hidden spending.  Have you  taken out a credit card or other line of credit that your partner doesn’t know about?  Watch out!  Your credit card may show up on your partner’s credit report.  You won’t want to explain that!

(5) Lying. Are you truthful with your partner about spending?  Do you hide any spending?  Discovering a pattern of lying or deceit destroys trust in a relationship.

(6) Inability to share. Are you paying your fair share of the expenses or compensating your partner in other ways so that you both feel you’re getting a reasonable deal?  Which of you makes the most money?  Should that matter?  Does it affect what you feel you can spend on yourself?

(7) Basic trust. Do you trust your partner to do the right thing when it comes to paying bills, spending money, going into debt, saving money, investing, making charitable donations, gambling and so on? Are you aware of your partner’s financial past?  Are you or your partner bringing a troubled financial past into the relationship?

(8) Taking care of business. Do you both pay your bills on time?  How do your individual credit scores compare?  Is one or both of you in charge of handling the bills?  Are you handling your end of the finances according to your partner’s expectations?


Models For Success


Understanding that every person is different and has different needs, a successful relationship still requires working out a method for handling money as a couple.  If you’re in a long-term, committed relationship, you need a working financial partnership—one that doesn’t leave either partner in the dust if something should happen, such as a divorce or death.



Many, if not most, attorneys are happy to suggest couples negotiate and agree on binding written contracts for some or all of the financial matters they face.  This can include prenuptial agreements, agreements for maintaining separate estates, for discharging debt, buying assets, etc.  There is also differing state law when it comes to living arrangements.  Some states are community property states that require couples to split assets in the event of divorce or the end of a long-term relationship where no other agreement was made.  Some states also treat certain couples who have resided together for long periods as if they were married.  This can bring up so-called “palimony” issues.  In truth, if you go into a relationship with a lot of assets, or if your potential partner brings substantial debt into the relationship, it can be well worth your time and money to consult with an attorney.


Get Clear


Get clear about your joint financial future.

Make money issues a priority and be willing to work out differences.

It’s good to have some common understanding of the financial issues at stake as well as agree to a strategy for handling money.  This is true whether you’re just entering a relationship or have been in one a long time.  As you consider trying to create a better joint future start by:


(1)  Agreeing to a basic budget for living expenses.

(2)  Agreeing on a way to account for bills and expenses.

(3)  Deciding who should pay what or how much each partner should contribute to a joint account to cover basic expenses.

(4)  Deciding whether to keep certain assets separate (i.e. maintain separate estates).

(5)  Deciding whether bank accounts should be held individually or jointly.

(6)  Determining important joint and individual financial goals.  These might include savings goals for significant purchases like cars, homes, getting a college degree, or planning for retirement.

(7)  Deciding how taxes should be filed (i.e. jointly or separately).

(8)  Deciding how to own assets and what should happen to them if one of you die.

(9)   Deciding how to pay off preexisting debt.

(10)  Deciding when to go into debt.

(11)  Determining a way to handle money related disagreements.

(12) Deciding who should be in charge if one of you become incapacitated.  This will require a power of attorney.


Talk It Over


Money allows us to afford a way of life.  When times are good and money is flowing it’s easy to avoid tough issues that may be simmering just beneath the surface.  Yet when money’s tight, your focus may be on affording the basic necessities of life and other issues may fall by the wayside.  To be sure you’re on track as a couple, take time to talk over your finances at regular intervals and make sure you establish short and long-term financial goals.  Getting a clear picture from your partner on how they view the situation can go a long ways to keep your relationship on track.  Finally, if you can’t agree about money, it’s a good sign there may be other problems brewing in the relationship.  Consider talking to a counselor to work things out.


Your Story?


We’re interested in personal stories about money and are looking for short articles we can post.  We’re willing to keep your name anonymous if you prefer that.  All submissions must be true.  If you’d like to submit your story, please send us an email from our contact page.


Comments are closed.


Favorite Pages