topic Re: Marriage and Debt in Relationships and Money

Marriage and Debt

KLEXH25 — Mon, 13 Apr 2020 18:44:05 GMT

I'm curious to get some different perspectives on this. To what extent do you keep finances & debts separate when you're married? It's one thing to keep separate checking & savings accounts, but how do you handle pre-existing debts that each person brings into a marriage (student loans, credit card debt, auto loans)? Do you keep that completely separate (every person for themself), or is there incentive to help your spouse pay things down? For example, if you are trying to save for a common goal, such as a house, how do you tackle that if the other person is still paying off their debt and can't contribute as much (or anything)? I've seen people mention various scenarios throughout the forum, which has always made me curious about how different couples handle their finances.

*PS* - I would like to keep this conversation friendly. I realize people will have LOTS of opinions about marriage and finances, so what I'm looking for is specific examples of what you have found works for you (or hasn't worked for you in the past).

Re: Marriage and Debt

Anonymous — Mon, 13 Apr 2020 19:03:07 GMT

We tackle our finances as one. Early in our marriage we did things separately. About 4 years ago we combined and have found that we can do so much more together. We can accomplish goals faster because you dont look at it as my money or his money. We paid off debt faster because we were on the same page and could put our combined income towards whatever goal we set whether that was paying down my husband's student loan or saving for our emergency fund. We do give ourselves an "allowance" each month to do as we please but everything else is done with our combined money and discussed.

In this I assume that both parties are being responsible. You know what the other brought into the relationship and you discuss big purchases regardless of whose name is on the contract. My husband wouldnt buy a car without discussing with me and I wouldnt do it without talking to him.

We have a joint account where we put our pay. We each had separated accounts as well to keep our "allowance". I closed mine since I stopped using it. He still has his.

Re: Marriage and Debt

pinkandgrey — Mon, 13 Apr 2020 21:05:26 GMT

I'm not qualified to answer this question as I'm not married, but I do know that my parents and my sister/her husband have everything in common. They share bank accounts and would help pay each other's bills if needed.

Re: Marriage and Debt

Kforce — Mon, 13 Apr 2020 21:34:44 GMT

@Anonymous wrote:
We tackle our finances as one. Early in our marriage we did things separately. About 4 years ago we combined and have found that we can do so much more together. We can accomplish goals faster because you dont look at it as my money or his money. We paid off debt faster because we were on the same page and could put our combined income towards whatever goal we set whether that was paying down my husband's student loan or saving for our emergency fund. We do give ourselves an "allowance" each month to do as we please but everything else is done with our combined money and discussed.

In this I assume that both parties are being responsible. You know what the other brought into the relationship and you discuss big purchases regardless of whose name is on the contract. My husband wouldnt buy a car without discussing with me and I wouldnt do it without talking to him.

We have a joint account where we put our pay. We each had separated accounts as well to keep our "allowance". I closed mine since I stopped using it. He still has his.

This answer is right on with the big

If : "Both parties are being responsible, have similar goals, and debts are not from foolish financial habits."

Else it is better to keep things separate.

Many start out separate and see how things go for a few years.

Go slow, you will know with a little time if it is wise or not.

Re: Marriage and Debt

Anonymous — Tue, 14 Apr 2020 01:04:53 GMT

I would say finances together. I would assume people talk about finances BEFORE marriage, thus everyone is aware of the other's financial situation. Doing things together gets it done faster, especially if you're working towards the same goals. Transparency is the key.

Re: Marriage and Debt

Kree — Tue, 14 Apr 2020 13:50:16 GMT

My wife and I both consider the other to be bad with money.

The wife because I use credit.

Me because the wife can't budget (its why she doesn't like credit, she over spends.)

So by mutual decision we keep our finances seperate. I've got the primary job, so I take care of almost all the bills, she takes care of groceries and "fun" things.

Re: Marriage and Debt

iced — Wed, 15 Apr 2020 12:11:48 GMT

@KLEXH25 wrote:
I'm curious to get some different perspectives on this. To what extent do you keep finances & debts separate when you're married? It's one thing to keep separate checking & savings accounts, but how do you handle pre-existing debts that each person brings into a marriage (student loans, credit card debt, auto loans)? Do you keep that completely separate (every person for themself), or is there incentive to help your spouse pay things down? For example, if you are trying to save for a common goal, such as a house, how do you tackle that if the other person is still paying off their debt and can't contribute as much (or anything)? I've seen people mention various scenarios throughout the forum, which has always made me curious about how different couples handle their finances.

Car's in my name, house is in hers, and we currently have no debt aside from the mortgage (which I pay even though it's in her name only). Nothing has joint ownership - it's all either in my name or hers. When we got married, she had no debt and I paid off my student loans (that is, she did not contribute).

As for finances, also 99% separate. We each have our own checking, savings, and brokerage accounts, though we do have an emergency savings account we both have logins to. I have no idea how much is in her checking/savings and she has no idea how much is in mine. We do have reciprocal login privileges (via Fidelity) to each other's brokerages, so I can make trades in her account on her behalf and vice versa. The joint emergency account also doubles as our transfer conduit - I can transfer money to her and vice versa via that account. This is useful for things like tax refunds: it goes into that account and then is split to our individual brokerage accounts for investment.

The only common goal I can think of would be another home. Anything else is of small enough value such that one or the other of us can cover it independently. When we travel, we'll split expenses (I'll buy airfare and hotel and she'll get train, for example), but there's never anything approaching us pooling money together for something. We do communicate about any purchase of more than a few thousand dollars so we're not going to catch the other off-guard by coming home with a car or new piece of art.

Re: Marriage and Debt

Anonymous — Thu, 16 Apr 2020 04:02:07 GMT

Our pre-exsisting debt is seperate. we have a joint savings we both contribute to (i contribute a bit more bit i also make a bit more). we both have auto loans and student loans. i owe about 30% more on mine than she does.

we both have our own checking and savings. we split rent and daycare. i take care of utilities. we kindof split food, its like whoever goes pays and it ends up being pretty even. vacations come out of our joint savings.

she has 25K in savings she brings pre-exsisting. i bring in 12k pre-exsisting

I have 15K in credit card debt. she has 0.

I pay all my CC debt. we both pay our own auto and school loans.

she has elite credit (800+ everywhere) i have good credit (700-750 everywhere).

Re: Marriage and Debt

800who — Wed, 22 Apr 2020 16:51:20 GMT

@Anonymous I'm not married so I don't have any knowledge on the topic, but I do question... how does it work out if a spouse's income is considerably more than the others? I think about that all the time when thinking about marriage and finance

Re: Marriage and Debt

Anonymous — Wed, 22 Apr 2020 17:08:49 GMT

@800who wrote:
@Anonymous I'm not married so I don't have any knowledge on the topic, but I do question... how does it work out if a spouse's income is considerably more than the others? I think about that all the time when thinking about marriage and finance

We have that situation. I make almost 3 times what my husband makes. When we make our monthly budget it is based off of our combined income and combined expenses. I dont think I'm entitled to anything more than my husband simply because I make more. I dont see it any differently than a single income with stay at home partner. My husband and I both work hard at our careers . I would think differently if I had a dead beat spouse and I wouldn't leave money available to be mishandled if I thought my spouse was irresponsible.

Re: Marriage and Debt

KLEXH25 — Wed, 22 Apr 2020 17:38:20 GMT

@800who wrote:
@Anonymous I'm not married so I don't have any knowledge on the topic, but I do question... how does it work out if a spouse's income is considerably more than the others? I think about that all the time when thinking about marriage and finance

That is a very valid point. Fortunately, my future spouse and I almost make the same exact amount, but that's typically not the case. I believe the fair approach would be to split shared expenses by the percentage you make, so if someone makes 2x more, then they should cover 50% more of the bills. Savings goals, they can contribute 50% more than the spouse who earns less. Of course in practice it may not work out as perfectly...

Re: Marriage and Debt

800who — Thu, 23 Apr 2020 01:17:37 GMT

@Anonymous That actually changed my pretty narrow opinion, I couldn't agree with that more. It's like I say to people all the time, there's people who make $25k a year and contribute to a savings account and there's people who make $250k going bankrupt. Thanks for your input!

Re: Marriage and Debt

Anonymous — Thu, 23 Apr 2020 15:32:03 GMT

@Anonymous wrote:
@800who wrote:
@Anonymous I'm not married so I don't have any knowledge on the topic, but I do question... how does it work out if a spouse's income is considerably more than the others? I think about that all the time when thinking about marriage and finance
We have that situation. I make almost 3 times what my husband makes. When we make our monthly budget it is based off of our combined income and combined expenses. I dont think I'm entitled to anything more than my husband simply because I make more. I dont see it any differently than a single income with stay at home partner. My husband and I both work hard at our careers . I would think differently if I had a dead beat spouse and I wouldn't leave money available to be mishandled if I thought my spouse was irresponsible.

We are in the same boat. I make a bit over 2x what my wife makes. I thought I might have a hard time reconciling "my money" and "her money" once we joined finances. But it turned out to be a non-issue. I just want us to be happy, successful, and live a good life. We both work hard and live below our means. Who brings in what money doesn't matter. She brought in about $20k of student loans. I don't see it as her debt to pay back. It's something we are working to pay off together so we can move on to other things. I feel like keeping separate finances and obligations would actually complicate things for us. Aside from our budgeted "fun money" we each get every month there is no mine and hers, it's all ours.

It's not how the money comes in that leads to problems, it's how it goes out. If you are not aligned there it will cause problems. If the person making less has bad spending habits, the person making more starts to feel like an ATM machine. If the person making more decides they get to make all the spending decisions, person making less feels like they aren't an equal partner. Even if the incomes are 50/50, disparity in spending habits and financial goals is a recipe for trouble.

Re: Marriage and Debt

Anonymous — Thu, 30 Apr 2020 11:26:58 GMT

@800who wrote:
@Anonymous I'm not married so I don't have any knowledge on the topic, but I do question... how does it work out if a spouse's income is considerably more than the others? I think about that all the time when thinking about marriage and finance

I just responded to another post about this. I feel like this is a huge reason that studies have shown most people marry within their income ranges (I am not saying *all*).

We have a huge disparity in income between me and my SO of over 20 years (been together since we were 16, so early start there lol). It has always been that way, not to say will always be. We accept the money is *ours*. Initially splitting bills and keeping things seperate led to lots of tension, fights, resentment, and stress. It is not right to expect to live a certain lifestyle and expect your SO to just make their half of the bills happen when you know it is not possible, and not from lack of drive or work. It just will not happen.

We currently have under 150k income. All mine, but it is logisitcs and we like it as is. I move loads for work (upwards of 4+ times a year), so it is pointless currently for him to work. If he worked it would be 175-200k household.

It works great for us. Everything in the pot together and it is ours. I drive the finances because of his lack of desire to manage our credit or finances, which works absolutely for me. Absolute trust is needed and we have that. It is absolutely possible, but from what I can see where people like to keep things seperate and split everything, it likely would not work or it could be volatile.

When my SO was working, he just deposited his money and I handled it from there. He is always free to spend, but he rarely spends without telling me, which actually sometimes bothers me like he needs "permission" to spend money. I guess Inwould feel differently if he drained the bank accounts, but that has never once been the case. I have to basically beg him to spend money. Where it sounds like some people would prefer the lower earner to only spend what they can afford based on what they make. I see that as an issue and could lead to resentment, depending on the disparity of income and especially in a one income household. You can't say I will spend freely and live a certain lifestyle just because I make more where as you, you have nothing because you can't afford it. That is just me, though.

Re: Marriage and Debt

Anonymous — Thu, 30 Apr 2020 11:32:36 GMT

@Anonymous wrote:

We are in the same boat. I make a bit over 2x what my wife makes. I thought I might have a hard time reconciling "my money" and "her money" once we joined finances. But it turned out to be a non-issue. I just want us to be happy, successful, and live a good life. We both work hard and live below our means. Who brings in what money doesn't matter. She brought in about $20k of student loans. I don't see it as her debt to pay back. It's something we are working to pay off together so we can move on to other things. I feel like keeping separate finances and obligations would actually complicate things for us. Aside from our budgeted "fun money" we each get every month there is no mine and hers, it's all ours.

It's not how the money comes in that leads to problems, it's how it goes out. If you are not aligned there it will cause problems. If the person making less has bad spending habits, the person making more starts to feel like an ATM machine. If the person making more decides they get to make all the spending decisions, person making less feels like they aren't an equal partner. Even if the incomes are 50/50, disparity in spending habits and financial goals is a recipe for trouble.

+100

Re: Marriage and Debt

Anonymous — Mon, 04 May 2020 03:15:59 GMT

Before we got married I opened a dialogue about debt, savings, credit and overall financial direction. My wife luckily had no debt, subpar credit (from non-use which was fixed promptly). The bad part is that she couldn't wrap her mind around viewing money as a tool and not this green piece of paper that buys nice things. When we got married I brought her over to my financial institution and we opened a joint savings account. We both have our respective checking and savings account. She adopted my mantra,"It's not how much you make it's how much you retain." We have our own little bills, but we earmark 75% of our income to our joint savings. This is for the sole purpose of ventures that will move us in a forward direction. She has no savings, because she just refuses to latch onto having a personal savings. We have a few months a year that we have a stay on dumping money into savings to allow us to handle things that are pressing on an individual level. I came into the relationship with 30k in savings so god forbid anything happened my emergency savings would sustain us for a few years easily. I think if a couple can align properly they should have their own accounts but have an account that they dump into. It keeps us honest on BS spending and we have open communication about our future plans with said money. Through this approach we are well on our way to financial freedom.

Re: Marriage and Debt

Anonymous — Mon, 04 May 2020 03:40:54 GMT

@Anonymous wrote:
Before we got married I opened a dialogue about debt, savings, credit and overall financial direction. My wife luckily had no debt, subpar credit (from non-use which was fixed promptly). The bad part is that she couldn't wrap her mind around viewing money as a tool and not this green piece of paper that buys nice things. When we got married I brought her over to my financial institution and we opened a joint savings account. We both have our respective checking and savings account. She adopted my mantra,"It's not how much you make it's how much you retain." We have our own little bills, but we earmark 75% of our income to our joint savings. This is for the sole purpose of ventures that will move us in a forward direction. She has no savings, because she just refuses to latch onto having a personal savings. We have a few months a year that we have a stay on dumping money into savings to allow us to handle things that are pressing on an individual level. I came into the relationship with 30k in savings so god forbid anything happened my emergency savings would sustain us for a few years easily. I think if a couple can align properly they should have their own accounts but have an account that they dump into. It keeps us honest on BS spending and we have open communication about our future plans with said money. Through this approach we are well on our way to financial freedom.

I guess I depends on how much you make, too. If you are someone that makes 50k a year and are forced to save 75% and then still need to pay bills and you have your remaining 25%...I would, personally find it unreasonable to save even further out of that, much less make the bills likely happen unless you can live at home with the in-laws. I am not dogging your train of though if the remaining income is well above the bills (likely well over my initial stated income used for an example) then that may be different. I like nice things, too. My husband has goals that right now might seem like spending money on fun, but it is really a hobby that can turn into a career. Even if it doesn't work out for him, you only live once, and I won't go into the grave saying that I didn't at least try for the sake of a few bucks in savings. Again, this is not a shot at you, as your methods may or may not work for your family, and they definitely wouldn't work for mine. Again, at just under 150k annually, I am more than willing to save 50%, but I am also being realistic with myself. If I make it impossible (especially trying to make a drastic change at once), odds are it just won't work. I started by throwing a few bucks in a different account and then it morphed into saving a lot in a lot if accounts and even investing because I now get joy from watching my money grow. I originally would live paycheck tonpaycheck because I love spending. In then end, I won't deprive myself if I truly want/need something, but I lean towards saving instead more than before. Sometimes baby steps and rewards and accepting it is ok to live in the moment occasionally is better than hitting a brick wall and getting nowhere.

Good luck!

Re: Marriage and Debt

importxpresions — Tue, 05 May 2020 18:57:27 GMT

My wife and I did pre-marital counseling through our church. We went into marriage knowing that once we were married we shared everything, including the debt. It wasn't a big deal because sharing the burdens and money we both make leaves no room for "this is mine" or "that is yours". You're in it together and the includes debt IMO. Work together to improve it, get out of debt, etc. that's life journey.

A friend of mine gave me some advice when my first marriage failed. He said he knows 7 or so couples that were divorced and a common denominator was they always had separate finances. Having been in a failed marriage that had separate everything I can attest it did create tension.

Re: Marriage and Debt

iced — Tue, 05 May 2020 19:40:03 GMT

@importxpresions wrote:

A friend of mine gave me some advice when my first marriage failed. He said he knows 7 or so couples that were divorced and a common denominator was they always had separate finances. Having been in a failed marriage that had separate everything I can attest it did create tension.

My first marriage failed indirectly because we shared finances. You'll find anecdotes and advice for every option and direction out there.

A lot of marriages are destroyed because of financial problems and/or a lack of trust, not because the couple had separate or shared finances. In my case, letting my ex access my finances created financial problems (I was a saver, she was a spender; oil and water). In others, the separate finances can create a lack of trust or still not address the financial problems.

My new marriage is going much better, but it's not because our finances are separate. We're both savers, and so there is no debt and no financial problems to fight over. I won't purport to say that money can buy happiness, but when making ends meet is less than the least of one's worries, happiness has a lot more room to wiggle itself in.

Re: Marriage and Debt

importxpresions — Fri, 08 May 2020 16:31:56 GMT

I agree many different opinions on things and ymmv. I would bet that the marriages which failed and finances were not shared was due to trust issues stemming from the beginning.