Quick Overview on Splitting Finances
“How” should married couples split finances is a question many new couples ask. “Should” married couples split finances is a better question; and the one we are addressing in this blog post. I’ll make the case here that, while married couples splitting finances might have surface benefits, longer lasting benefits are found in the skills of communication and cooperation between spouses that are necessary when keeping your finances together.
The Problem When Married Couples Split Finances.
“A house divided against itself cannot stand.” This famous quote from former President Abraham Lincoln was originally uttered to address an issue far different than how a married couple should split finances however the sentiment is 100% applicable. A husband and wife splitting finances is akin to aiming their financial resources at differing financial priorities. This can lead to financial stress that can kill your marriage. Imagine two people rowing a boat in opposite directions. Even worse is the absence of any priorities at all. A couple not in sync with their financial priorities is playing tug-of-war even if they don’t know it.
When married couples split finances they think in terms of “mine” and “yours” instead of “ours”.
Married couples who split finances often end up with a lot of “mine” and “yours” thinking. Even if that is not the intent from the beginning. However, married couples who have learned how to operate out of the same shared checking account find that viewing their resources from an “ours” lens, enables them to accomplish more together than if separate. Additionally, the communication and effort that it takes for a married couple to set common goals and collectively aim their money at those goals is a huge indicator of future success.
The communication and effort that it takes for a married couple to set common goals and collectively aim their money at those goals is a huge indicator of future success.
Budget Coach USA
When married couples split finances, marriage can become transactional instead of selfless.
Nothing can kill the mood in a marriage like a good transactional discussion. Gives you warm fuzzies does it not? Okay, I’ll admit there are times when a negotiated result is needed in marriage. However, when married couples split finances it is less about a negotiated agreement and more about financial autonomy. Talk about a mood killer!
In our experience, avoiding a transactional marriage and aspiring for a giving, selfless cooperative marriage, especially in the arena of finances, has been a game changer. A level of closeness developed that we had not experienced before because we spent the time needed to identify OUR priorities and share together in reaching our goals. Your future marriage will thank you.
Sharing a common set of goals and dreams and budgeting your money collectively towards those goals and dreams will bring you closer than you might think. I promise it’s true.
Instead of Splitting Finances, Discuss & Act on all Financial Decisions Together.
Married couples who split finances are missing out on opportunities to deepen their connection. Communicating about money leads to success which in turn fuels better communication. Married couples are successful with money & marriage when communication lines are open and strengthened. An often unexpected benefit of married couples handling finances together successfully is that the marriage is strengthened through trust and team accomplishment. When each person trusts the other with money, and each person can see the effects of their teamwork on their goals, a closeness develops that was not present previously. Trust me. It’s true.
Handle finances toward agreed-upon priorities.
If you are asking how married couples should split finances, we would encourage you instead to view your money as a collective resource for the advancement of your agreed-upon priorities. Do this by talking frequently about your shared hopes and dreams and then begin budgeting together, aiming your money at those goals and dreams together.
- Set a time together to discuss what you want your financial lives to look like in 5, 10, and 20 years.
- Decide together what goals should be set to reach your shared vision.
- Create a monthly budget that aims your dollars toward your goals.
Create a joint budget together.
A budget is a practical tool that allows married couples to handle finances toward their goals and priorities. Voluntarily submitting their individual spending decisions to the boundaries of their budget is a strong signal of future success.
At its core, a zero-based budget is rooted in how you prioritize your money. A zero-based budget puts all the cards on the table and reveals your hand. There is nowhere to hide. For instance, if you are following a zero-based budget faithfully you will soon see if you are overspending on groceries or another category. Once you have that knowledge you only have a couple of choices: Keep overspending or adjust your habits to meet your goals. A zero-based budget shines a light on your spending decisions and creates opportunities for you to make choices that align with your goals.
Instead of Splitting Finances, Operate Out of a Joint Checking Account.
Transparency is the name of the game! Married couples cannot win with money if they hide income or spending. If you are serious about winning with money then operating out of a single shared checking account is a must. The result will be accountability. Accountability will lead to the results you both want. Splitting your finances into separate bank accounts is a breeding ground for conflict and mistrust. Successful married couples handle finances by sharing a single checking account and allowing themselves to be accountable to each other for their expenditures. “Yours” and “mine” does not work in marriage. Instead, choose “ours”!
The Benefits When Married Couples Don’t Split Finances.
Communication is improved
If you can learn to handle your money together as a couple instead of splitting it, you’ll find that you can communicate on all other issues better too. The cooperation needed is a transferable skill that pays dividends throughout your marriage.
Intimacy is developed
Couples who manage their money together, according to their agreed-upon priorities, grow in intimacy. When you both are rowing your metaphorical boat in the same direction, your levels of trust and mutual appreciation grow as well. Guys take note: intimacy is developed over time. HINT!
Other hard things become easier
Learning to budget together is a transferable skill. This means that you quickly learn to use the same skills needed to communicate about your finances to solve other relationship problems too. Things that used to cause stress and arguments are more easily solved with the same cooperative skills you use to handle money together.
Wrap Up
Married couples who handle their finances with transparency are most likely to win with money, reach their goals, and retire with dignity. It is a lifelong endeavor that pays huge dividends. Communicating in marriage about your finances and expenditures leads to more trust and overall greater satisfaction.
How should married couples split finances? In our experience, you shouldn’t. You might gain short-term satisfaction from splitting your finances but in the long-run you’ll miss out on opportunities to improve your marriage, accomplish things together, and build skills that last well into your later years.
Take it from a former money dummy. There is a better way!
