How do folks manage joint finances?

...especially ones where there is a significant differential in how much each person earns. How do folks successfully split expenses?

SWMBO and I are moving progressively closer to being married (we haven't set an actual date yet, because we'll probably just do a Justice of the Peace and give family a month or two heads up). Anyway, we're talking financial stuff now.

All figured, we're in pretty good shape. Both employed. No debt. No kids. Between the two of us, we make good money. The majority of that is her, though. She makes about double what I do. I will probably be earning more in the future, but I'm not sure how much more how soon. I doubt I will ever fully catch up to her salary as a brewer unless I manage to start a successful brewery of my own, or go to work for a big guy (probably macro).

Right now, we share a joint account to cover the obvious big-ticket shared expenses: rent, utilities, internet, phone, and occasionally food. She started to give me a bit of grief because she puts more into the account than I do, until I looked up and saw the discrepancy is only $100/month, and we're putting in money much faster than we're spending it.

Also coming up: we're talking about relocating so that she can go from working from home like she does now, back to being in an office. That means Des Moines or Columbus. If we do that, it does a lot to boost her opportunities for career advancement, and probably not a bunch for mine. My best bet would be to get on with a large craft place like Firestone, Sierra Nevada, Rogue, or Victory. That would not help her career though.

I think it is starting to get through to her how much less disposable income than her I have, and that my priorities for spending it are much more in the way of toys, where she prefers home furnishings.

Any suggestions on how people divide up expenses happily? Do you split everything 50/50? Do you split based on percentage of income? Somewhere between? Do you split different types of expenses by different amounts? Say, rent and utilities are 50/50, but new furniture is more on one person.

At a $100 discrepancy a month when she's accounting for 67% of the household income, there's really nothing to complain about.

We try to split close-ish to 50/50 even though we're in much the same situation. I make twice what she does. I believe even so, i end up paying a bit more than half of the bills, and i also end up paying for everything we do and maintaining/modifying all the cars.

I'm ok with this. This leaves her with a little bit of spending money to buy girl things and stuff, and i don't have to worry about anyone telling me what to do with my extra money.

We put it in the bank account.

We talk about a budget.

We spend it.

We both own 100%, including the bills.

That's it.

I would avoid joint accounts until married.

I make it. She spends it.

(you asked)

Seriously - I don't want to argue about money. I just threw in the towel. I have not paid a bill in 15 years, have no idea what's in the checking account and just work on trust. YMMV

SVreX wrote: We put it in the bank account. We talk about a budget. We spend it. We both own 100%, including the bills. That's it. I would avoid joint accounts until married.

Word for word. I don't know how people can separate the finances and not have it backfire.

She handled the bills for the first 10 years or so, then got fed up. So now I do. It doesn't annoy me as bad as it did her. We had more savings when she was doing it, we have less debt with me doing it.

We have a joint account that all our bills, food and the like get paid from. Then we have separate accounts to pursue our hobbies and the split is equal between the "hobby" accounts.

I'm married and we got rid of personal accounts years ago (unfortunately, and a long story).

But for the first 8-10 years of our relationship/marriage we had a joint account and both had personal checking/savings accounts.

We divided the joint account based on earned wages, so it was like a 60/40 split. All other income went in to our personal accounts, but would be used occasionally to fill gaps in our joint expenses.

I loved it. I felt like I paid my share of expenses and I could buy toys with my money in any way I like. If she wanted a nice piece of furniture (just like your SWMBO), it came from her account. I only get reminded monthly that the $2K dining room table is "hers".

Now it's all "our" money and I am only bitter at her expenditures occasionally. Unfortunately I feel like I'm a martyr when it comes to giving up my toys/hobbies and she still gets whatever she wants.

If she is already bitter about putting in an extra $100 a month, I suggest you keep it as it is.

Now I just collect what few bucks I get for doing side work to buy race tires and go-fast parts.

bludroptop wrote: I make it. She spends it. (you asked) Seriously - I don't want to argue about money. I just threw in the towel. I have not paid a bill in 15 years, have no idea what's in the checking account and just work on trust. YMMV

Quoting myself - how strange is that?

I'll add that we live considerably below our means, by mutual agreement and nature, so it really isn't an issue. Lately we've had a bunch of unanticipated expenses (mostly medical) that we've been able to take in stride, so we must be doing something right.

Separate accounts here (this started because we lived together while she was finishing college and working and I was graduated and working).

She makes a bit more than I do, so this is how we split it up.

House = 50/50 (and any upgrades, problems, fixes, etc) She pays for all the groceries, going out to eat, booze/beer I pay the utilities, cell phone, insurance on the cars

It's not an exact split but close enough.

Vacations are typically spilt 50/50 as well. However, this year she is paying for more our 2nd big vacation because we spent our normal big money on a vacation already and gutting/remodeling the bathroom and some other house upgrades.

I explained to her that she spent our "fun" money for the year, so if she wants another vacation, I would contribute X amount, and if that wouldn't work, we wouldn't go on a 2nd vacation. Yes, I know 1st world problems.

We both put a healthy amount in savings/retirement. And we have the rest to do with what we see fit.

So for us it works great and has been working great for almost 7 years. We don't ever fight about money.

Different finanical arrangements work for different couples - I think you have to start with that understanding, and try to figure out what will work for you.

My wife and I - we didn't live together until a month or so before the wedding, and once we got married, we opened a joint checking and joint savings account, and both salaries go in, and all bills and other expenses come out of it. Major expenses are discussed and generally agreed upon. We're both pretty conservative about hobby spending, and so far it works for us (14 years later).

I personally think it's a mistake to think about equal contribution to household income - there are so many other factors - having one spouse available for child care (whether that's stay at home or work schedule flexibility), taking care of the home, living where you enjoy living, ability to maximize income generation and minimize living expenses, among many others.

My wife has always made more than me. About 50% more. Our money combined is our money. Big purchases we talk about. Saving for specific things we talk about. Little things we just kinda buy what we want/need. We each take care of getting bills paid in time.

Yeah that's about it.

We had a joint savings account before we were married so we could both contribute to a house downpayment. Joint checking once we were bought the house, married about a year later.

Wife makes all the money. I do all the financing. I transfer back and forth as needed.

DILYSI Dave wrote:

SVreX wrote: We put it in the bank account. We talk about a budget. We spend it. We both own 100%, including the bills. That's it. I would avoid joint accounts until married.

Word for word. I don't know how people can separate the finances and not have it backfire. She handled the bills for the first 10 years or so, then got fed up. So now I do. It doesn't annoy me as bad as it did her. We had more savings when she was doing it, we have less debt with me doing it.

Everything said here is us also. I do buy and sell cars and parts which I keep completely seperate but otherwise dilysidave and svrex have it right.

Now; if concerns are already there they will just get worse; have you had any counseling?

We kept everything separate until we were married and then went joint-accounts on everything. We agree to a budget and then we stick to it. Each week, we take out cash that gets divided into grocery money, entertainment money, and our respective (equal) allowances. She uses a checking account, I use an envelope full of cash, but when we want to buy something that isn't for the family, we each have "permission" from the other to use those funds without any consultation. If we're buying something for the family that isn't groceries we either pull that from entertainment or we sit down and review the budget and cash flow and determine if its something we can afford. Overall, my wife handles the money-spending part of our finances: making sure bills get paid on time, keeping the checkbook balanced, and so on.

One thing I can tell you is that we went to a mostly-cash system for eating out and groceries and things like that, we quickly built up a fairly decently-sized wad of cash. You really do spend less when you're using physical money instead of a debit or credit card.

Sounds like the overwhelming number of people here pool everything, and then set up individual allowances (maybe in a separate account) for personal stuff. Is that the case?

I'm also struggling against the shadow of my father. He's a bit of a cad, and has spent much of his life with other people actually being responsible for taking care of his needs while he goes out and plays with expensive toys and tries to start businesses in hopes of striking it rich (it worked once, and then the money was all lost). She is afraid I will just turn into my dad, going out and playing while I leave it to her to actually take care of everything.

This is something we will have to talk about, because I would like to start my own brewery some day. That would mean her being the one actually paying the bills while the business goes from red to black.

This is all stuff we're talking about. We had some good discussions the past couple of weeks. She's realized I am more aware of my own behavior and my family's behavior than she suspected I might not be. She is also starting to comprehend how little I make compared to her. I found out she makes about $10k/year more than I thought she did.

Swank Force One wrote: At a $100 discrepancy a month when she's accounting for 67% of the household income, there's really nothing to complain about.

Yup. And she stopped complaining when I showed her how small the discrepancy is. And she is closer to 70% of household income.

bludroptop wrote: I'll add that we live considerably below our means, by mutual agreement and nature, so it really isn't an issue.

This. Wife and I have had a shared account for 10+ years. Any single item under $100 is no-questions-asked. Anything over $100 we discuss whether we really need it or not. We're both frugal and feel bad about spending frivilously, so it largely regulates itself.

calteg wrote:

bludroptop wrote: I'll add that we live considerably below our means, by mutual agreement and nature, so it really isn't an issue.

This. Wife and I have had a shared account for 10+ years. Any single item under $100 is no-questions-asked. Anything over $100 we discuss whether we really need it or not. We're both frugal and feel bad about spending frivilously, so it largely regulates itself.

This is how the wife and I do it. It works really well 99% of the time until I want to go out and spend some cash on a project with one of my bonus checks. Then we have a bit of a tiff but she unstands most of the time.

When I was chained, er, married I made a good bit more than she did, but her 401k was fantastic. So I paid the (~$1250 a month) mortgage, electric bill etc and she handled the smaller utility bills and groceries. We kept paid for cars and I did all the maintenance, repairs etc. I also kicked in generally $200 a month toward the utilities etc as well, we didn't make a big stink about percentages since we were working toward a common retirement goal.

If I bought a toy etc it was with money I had saved or had made by flipping cars on the side, I used that money toward house expenses as well. She pitched a bitch about one of my last big ones (my last new dirt bike) but when she saw it was 100% money made on the side she relented.

Count me in the 1 account all money goes it and comes out according to a budget. There is no Me in Family and we set family time and budgetary priorities. Hobbies of mine are prioritized within the family time/budget and I persue those hobbies per that plan. Thus far through 8.5 years it's going great. We never fight or argue about money because we know what is going to get spent on what. The only time we really pay any attention to our relative incomes is at Tax time because it's two big numbers and we joke with each other about it.

SVreX wrote: We put it in the bank account. We talk about a budget. We spend it. We both own 100%, including the bills. That's it. I would avoid joint accounts until married.

+2 We have been doing that for 45 years and it works just fine. Now that we are retired our monthly income is within $100 of each other. But while we were working who was making the most money changed frequently.

SVreX wrote: We put it in the bank account. We talk about a budget. We spend it. We both own 100%, including the bills. That's it. I would avoid joint accounts until married.

^ this

Once I got married, we merged the accounts. Never a problem, J

We're in with the 100% mix rates. There is no her money and my money. It doesn't matter who earns more, it's 100% shared. Neither of us buys anything without consulting the other. My view, if you're not ready to share 110% your not ready to be married. I earn more, so what, she spends more time picking up the house, running around kids etc. Who knows, in 20 years she may earn more than me.

SVreX wrote: We put it in the bank account. We talk about a budget. We spend it. We both own 100%, including the bills. That's it. I would avoid joint accounts until married.

Basically. My wife makes WAAAAAAAAAAYYYYY more than I do (#winning) and it's not an issue. I'm in charge of paying the bills and I give her a heads-up when the spending needs to slow. Thankfully, it's a non-issue in our household.

When we were both doing better (around 2010), we were at the point where we didn't even think about it. 'Twould be nice to get back to that point again...

Adrian_Thompson wrote: We're in with the 100% mix rates. There is no her money and my money. It doesn't matter who earns more, it's 100% shared. Neither of us buys anything without consulting the other. My view, if you're not ready to share 110% your not ready to be married. I earn more, so what, she spends more time picking up the house, running around kids etc. Who knows, in 20 years she may earn more than me.

That's one of the things that's different for us. We do not have kids. There is less to clean up after or shuttle around. We both work similar hours, and my work is more physically tiring than hers. I tidy up around the house less than she does. I am less bothered by messes and make fewer of them. I do however drive every time we go somewhere together, and I cook a bit more. I definitely do more handyman maintenance stuff. That's nowhere near the work of picking up kids, going to PTA meetings, and planning/cooking meals for a family.

I have no problem with pooling finances, but again, I make less money.

Managing finances with 100% mix rates would not be tough though. Even me making as much less than her as I do, I barely need to put any thought into my finances. No debt. No kids. I basically just have to be reasonable and not impulse buy. I would like to be putting more into saving though.

It's not a competition, it's a joint effort. Go all in together, or don't even bother. Separate accounts just mean you want to hide something.. If you and a spouse cannot have an honest conversation about purchases, don't marry.

Good discussion topic pre-marriage, definitely.