When two people decide to live together, one of the things to think about is how organize expenses. Here are four different ways to manage what you earn and spend so you can choose the one that best fits your lifestyle.
Option 1: A Joint Account
In this case, the two choose to have only one or perhaps more accounts, but all joint accounts moved by both.
Pros: Reduces paperwork and facilitates operations such as payments and deposits, as everything is centralized in one account.
ConsThe downside of this option is that if one spends more than the other it can create some kind of conflict, so anyone who chooses this way of organizing finances must combine some way to make spending more equal and fair. Unless this is not a problem for both of them.
Option 2: A joint household expense account
In this option, the couple each keep their own personal expenses account and a joint account for common expenses such as home and child expenses. Both will deposit an equal or similar amount per month so they can share their expenses equally.
Pros: This option is a little fairer because both can collaborate in the same way and it is easier to separate what is expense from the couple and what is expense of each other. This facilitates the organization of personal finance in general.
Option 3: Individual Accounts and Shared Spend
In this situation, each has its account separately and each pays certain common expenses. For example, the woman pays the rent and the energy, while the man pays the condominium, the telephone and water.
Pros: The good thing about this alternative is that each person takes care of his or her own, so it is easier to see how much the person is spending on themselves and their common expenses. It also facilitates control and saving money.
ConsThe downside is that one may end up spending much more than the other, but if that's not a problem for you, it's not a negative aspect.
Option 4: Individual Accounts and Shared Spending Equally
This alternative refers to couples who prefer to have their accounts separate, but each also contributes money to pay for expenses at the beginning of the month.
Pros: As with the previous option, it makes it easier to control spending and you can save more if you want.
Cons: When one is unemployed or earns much less than the other, he may suffer from having to have a large part of his salary to contribute equally to the common expenses.
Tips not to err on the couple's finances
The most important tip is always to keep track of the couple's operations. Keep receipts, slips, bills pay and write down everything possible. This can be helpful as well so that you can better plan spending to make the most of your salaries, paying bills and leaving a percentage to invest or save.
Another tip is to put the bills into automatic debit or choose one of the couple's two to pay them off. Thus, you avoid that one thinks the other will pay and ends up not paying and in the end, neither paid the bill.
Save it. Saving to spend less and to spare money is essential for the couple. After all, you never know what might happen in the future and someday you may need this money, either for an emergency or to buy your own home. It is better to be safe than to be in debt later.
Beware of financial infidelity. Be honest with each other. No omitting buying values or lying saying you didn't spend on certain things. Honesty is one of the main pillars that underpin the relationship. So don't let finances become a problem between you, because in reality money should serve as support for both of you and not as a cause for discussion.
Follow the tips and make the most of what you both get for a comfortable, organized, stress-free life when it comes to couple finances.
Puritan Financial helps Arlington couple organize finances (May 2021)
- Career & Finance