Living Together: Money Apart
Should you and your partner merge your money? Ben Tutty looks at the pros and cons of an issue that can lead to friction in relationships.
16 August 2022
In the early days of my relationship with my partner, I was self-conscious about money.
I chose a career as a freelance writer (and nap enthusiast) and she chose to be an accountant, so as you’d expect, she brought home a little more bacon than me.
Because of my insecurity over that and because we kept our money separate, I became obsessed with paying 50 per cent of everything and devised a way to make sure I did – a gigantic spreadsheet recording all our joint spending.
This sounds like a spectacularly awful idea, because that’s exactly what it was.
All of a sudden, after never having a single financial disagreement, my partner and I were constantly bickering about money.
What’s your spreadsheet?
After a couple of years of painstakingly recording every transaction in that dreaded spreadsheet, my partner deleted the document without warning.
Afterwards, we talked it over and since then we’ve barely had a single fight about our finances.
This problem isn’t unique to my relationship – in fact, most couples have one niggly financial issue that tends to incite arguments. Their very own spreadsheet, if you will.
Chances are many of those issues arise for similar reasons, around merging money, overspending and paying a fair share for joint expenditure.
These problems might be exacerbated if one partner earns less or if a couple have different attitudes towards money.
How can we navigate these problems in a relationship to avoid a spreadsheet debacle? And when’s the right time to merge your money with your partner’s?
To merge or not to merge
Lynda Moore (The Money Mentalist), a financial adviser who helps couples and individuals understand and improve their relationships with money, says having joint money in a relationship isn’t essential.
“Merging your money isn’t something you have to do and it certainly isn’t something that you want to rush into. If it’s early in your relationship, a good place to start is to just have one joint account that you both deposit into for spending when you go out together.”
The key, according to Moore, is to start small and get to know each other’s money behaviours before you think about merging money. That way you can be sure that you won’t get a nasty surprise a few years down the track.
Moore adds that even when you do merge your money, it’s vital that both partners still have guilt-free spending money.
“One couple I spoke to had fully merged their money. She’d spend more than him and he’d get grumpy about it.
“To fix the problems, we created separate spending accounts for both partners and since he couldn’t see her expenditure, he stopped caring.”
With that said, Moore reckons if you want to keep your money separate that’s fine, as long as there’s trust in the relationship.
“If you apply for a mortgage or a loan, chances are you’ll find out all about your partner’s financial situation anyway.
“I’ve met a lot of people who discovered during a mortgage application that their partner has a car loan or a credit card that they didn’t know about.”
Different financial strokes for different folks
Every couple is different and has unique priorities when it comes to money, so naturally every couple should have a different approach to how they manage their joint (or separate) finances.
For example, my partner and I have no separate accounts and it’s worked fine for almost seven years now (ever since we deleted that nightmare spreadsheet).
Aucklanders Jason and Abby have done the opposite, just as successfully. They’ve been together for six years, travelled, bought a house and adopted a dog – all while keeping their money separate.
“With the exception of mortgage payments our finances are completely separate. This is because we both have jobs and earn our own income and haven’t felt the need to merge money,” Jason said.
Since Jason earns a bit more he typically pays for holidays and work required around the house. This way of managing money has all evolved organically, and according to Jason it’s never been a problem.
Others, like Albert and Carol, a Kiwi couple living in Amsterdam, have a different, more flexible, approach.
“We have independent accounts which our respective earnings are paid into, and we have a shared account, which we deposit equal amounts into, to cover things like bills, rent and other shared expenses,” Albert said.
Carol says they’re pretty relaxed and tend to take an easy-going approach to keeping things fair.
“I would also add that for stuff like going out for dinner or grabbing a coffee we just alternate who pays. We don’t police it that much.”
They both agree that they almost never argue about money.
“Nothing’s really that hard. Other than food and travel, we’re not big spenders. Things are pretty simple because we’re so aligned.”
Date nights are sacred
Unlike Albert, Carol, Jason and Abby many couples struggle when figuring out how to manage their money together, and that’s fair enough.
Moore says each partner brings unique ideas and priorities about money into a relationship and if they don’t align that can be tough to reconcile.
“I’ve worked with a lot of couples who have an amazing relationship but really struggle with money.”
Moore adds that the key to working out what’s right for you and your partner is taking it slow, talking and not allowing money worries to take over.
“The most important thing is communication. If something’s on your mind, approach the topic gently with your partner and avoid getting into an argument.
“Oh, and never turn a date night into a financial planning session*.”
*Sorry, Barefoot Investor.
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