How to manage money as a couple

It doesn’t matter if you have no money, a lot of money or fall somewhere in between – money influences everything in relationships from everyday budgeting to long-term planning and decision making. And when you’re in a long-term relationship and your lives are intertwined, it’s inevitable that your financial positions will be intertwined too.

For many people, talking about money in a relationship is a prickly topic because it can evoke feelings of insecurity or judgement, especially if there’s a big difference in income, net worth or debt levels. But financial compatibility and having habits, attitudes values and goals that align are a crucial part of keeping a relationship together for the long haul. Read on to learn how to manage money as a couple.

How to talk about money as a couple

Money is a notorious stressor in relationships. If you’re starting to get serious with someone and haven’t started talking about money as a couple yet, it can be a little awkward to bring up. People have different levels of comfort when it comes to talking about money for different reasons – maybe you or your partner are anxious about having student loans or credit card debt, or feel like you want to earn more money but don’t know how, or simply just don’t know how to talk finances because it’s not how you were raised.

Talking about money can be uncomfortable, but it doesn’t have to be. Like almost everything else in relationships (and life in general), it comes down to communication. The key is to adjust to your partner’s communication style and be transparent and honest. You don’t need to think of it as The Big Talk, but the start of a series of ongoing financial conversations that will happen throughout your relationship.

Your finances don’t need to be in immaculate shape before sharing the details with your partner, but you do need to be open to working through issues if you share differing views. Ultimately, talking about money doesn’t have to be drudgery – once you get over the initial awkwardness, it should become a normal and healthy part of your relationship. Wanting to share more about your personal financial situation and know about your partner’s is also a strong sign that you see yourself with this person long term and want to commit to them.

Should I merge finances with my partner?

First, some good news: There’s no right or wrong way to merge your finances as a couple. As with most personal finance questions, the answer to what you “should” do is, “it depends.” There are several variables that affect the dynamics of how individual couples handle combining finances, including the level of comfort you and your partner each have with talking about money, managing money and your individual spending and saving habits.

If you feel like merging your finances together is the right thing to do, then by all means, go ahead. But if you keep your finances separate and that’s what works for you, then go with that. That being said, there are several different ways you can manage your money as a couple. Consider the following scenarios along with their pros and cons.

Scenarios on managing money with your partner and the pros and cons of each

Joint account

This is the traditional method of combining all your finances together into one bank account. You and your partner will each get a debit card and have equal access to making deposits, withdrawing money and monitoring transactions.

Pros: If you’re cool with the “what’s mine is yours” philosophy, sharing a single account is the most simplified way to keep track of your incomes and expenses. Both people can access money when they need it for things like everyday spending and paying bills and there’s transparency around transactions and where your money is going.

Cons: Combining all of your finances into one joint account requires a lot of trust. It can also a be a big adjustment to start sharing everything and having your purchases scrutinized by another person. Communication is key, as there may be some tension if one partner earns more or spends more than the other. If you break up, there’s also the risk of one person going on a spending spree or draining the joint account.

Separate accounts but joint account for household finances

There’s also the option of maintaining separate personal bank accounts, but opening a joint account to pay for shared household costs such as rent or mortgage payments, utility bills, groceries, pet expenses or emergencies. You can decide how much you each contribute each month, and draw from the account when needed.

Pros: This method has the best of both worlds. You deposit a set amount each month into the joint account to cover your half of the bills, but you still have the freedom of having your own spending money in a separate account. This also works well if you have separate financial goals – your partner can save up for that expensive watch they want, while you can prioritize your personal emergency fund.

Cons: You have to make sure the joint account is consistently funded by both parties. Deciding how you want to split household expenses may be also difficult to figure out. You can split your monthly grocery bill, but will you get as granular as splitting the cost of going out for dinner? Also, will you split your monthly bills 50/50 or adjusted based on a percentage of each person’s income? It’s up to you to decide how you will use the joint account, and who will be responsible for using that money to pay the bills each month.

Completely separate accounts

This method keeps your finances completely separate. You can still choose to split your household expenses, but you’ll both pay for them out of your own accounts.

Pros: This method works well for people who value independence because you only have to worry about yourself and managing your own accounts as you see fit. You’re completely independent from your partner and do not need to rely on them or worry if they have bad spending habits or bad saving habits (and vice versa).

Cons: Even if you have separate accounts, you’re still tethered to your partner’s financial circumstances and their choices can still affect you. You need to make sure you’re both still on the same page about spending, saving and your future plans. Even if your finances are separate, you may end up worrying about your partner's ability to pay the bills, and it becomes very difficult to figure out how to split your expenses.

Final thoughts on managing money as a couple

Every couple is different, so there isn’t a strictly prescriptive way to manage your household finances – you may want to use one of the three scenarios described above, or something completely new. The most important thing is finding a system that works for you and your partner where both people are informed, involved and working toward the same future goals.