Should We Combine Finances After Our Wedding?

As my wedding date approaches, there are an ever-increasing number of things to worry about and keep track of. While I’ve let my fiance take control of most of the wedding plans, the things I’ve spent my time thinking about take place long after we get back home from the honeymoon. Mainly, should we keep our money separate, or should we combine our finances after getting married?

 

Most people I talk to seem to be on one end of the spectrum or the other. They either say you should keep everything separate and in your own names, or they say you should combine everything and think of yourselves as one financial entity.

With money being a topic that causes so many arguments and so much stress on relationships, this isn’t a decision to take lightly.

Our Background

We’ve been together for several years now and money has never been a big focus in our relationship. We both handle our finances extremely well and have done pretty well for ourselves individually. She doesn’t rack up huge credit card bills at the mall (despite a definite shoe fetish) and I don’t have mounds of student loans that we need to dig out from.

We actually have very similar views financially. From the start of our relationship there was never a discussion or any tension over who would pick up the bill at the restaurant or who would pay for the movie this time. We seemed to work out a natural balance without even trying and have been rolling along ever since. I think the place we differ the most is in our risk tolerance. She tends to be quite conservative, treating each dollar as something important, not to be parted with lightly. I, on the other hand, tend to be more of a risk taker. I don’t get emotional over the highs and lows that come with investing. Money is just a tool to be used in my mind. I guess this comes from my history as a poker player. After a while you get used to the ups and downs of the game and focus only on making the best possible decisions, much like we all should do with the markets.  (Related: How Poker Made Me A Better Investor)

Perceived Problems When Combining Finances

  • Different Goals – At the heart of our differing risk profiles are different long-term goals. She enjoys the corporate life, and is quite content to work the next 30 or so years and retire at the typical retirement age. I would prefer to leave the corporate world behind ASAP and look to focus on investing aggressively and creating multiple income streams. If we were to combine finances we would have to reconcile some of these different outlooks.
  • Unequal Incomes – I doubt any couple makes the same amount of money, and we are no exception. With the disparity in our incomes it may feel like one person is more “along for the ride” than the other. Especially with major purchases and long-term goals, with one pool of money there’s no real way to fairly split these things proportionately based on income.
  • Holidays – Albeit a minor problem, buying each other gifts out of a joint pool of money just doesn’t seem like it’s much fun. The element of surprise would be lost!
  • Too Many Accounts – We each have a checking, savings, and several investment accounts. Going through the process of opening and closing accounts, transferring money, changing direct deposit & auto-pay’s seems like a huge pain in the ass. Our systems have worked for this long, why change them? If it ain’t broke, don’t fix it. Right?

A Trial Run

We haven’t made any decisions on when, how or if we’re going to combine our finances. But what we are doing is giving things a sort of trial run. This year we’re living off of one single, combined budget leading up to our wedding. This will give us a taste of treating our finances as one while still retaining the autonomy of our own bank accounts.

The same goes for our investments. She’s been gracious enough to give me (most) of the control over the investment strategy and decisions. So I imported all of our investment accounts into Personal Capital which makes it infinitely easier to view our nine (NINE!) investment accounts as a single entity. It would take me an hour to figure out our asset allocation and review our holdings by hand. Now I can develop and implement a singular strategy without much work at all. (Related: Personal Capital – The Best Way To Manage Your Investments)

Final Thoughts

Obviously the best way to work out these issues is to talk to your partner about them. We’ve discussed things in passing but simply haven’t had the time to talk about them at length. In the end I’m sure we’ll end up with some sort of hybrid system where we combine the majority of our finances but leave ourselves a personal account of some kind.

Combining your finances into a single unit, or keeping everything separated can both work for your relationship. The key is to have the discussion with your partner and find out which approach suits your personalities and goals the best.

Readers: What approach do you take to the finances in your relationship? Have you gone from combined finances to separate finances or vice versa? What are the pros and cons you’ve experienced with your chosen style of money management? 

 

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30 Responses to Should We Combine Finances After Our Wedding?

  1. I doubt there is a right or wrong way of approaching this. A lot depends on the couple. As you rightly point out, why fix something that is working perfectly right now? better go on as things have been or adopt a hybrid model or better yet, consult with a professional to help weigh your options with a clear view of the bigger picture, taxes included.

  2. I think every couple (or family) is different. As long as both partners are happy with the result, I don’t think there is a wrong answer. My wife and I combined everything, except a few investments we brought to the marriage. We paid off all debt, which wasn’t much, as a team. So far so good. We are only 1.5 years into our marriage, but those early conversations about money were very important. Best of luck

    -Bryan

    • It’s good to lay the foundation early. I think being open about money and on the same page with your partner goes a whole lot further than the decision to combine or separate the money.

  3. First Million,
    My wife and I combined everything right after marriage. Its the way both of our parents did it, and we felt it was best for the family. We decided even before marriage that she would stay home if we had children. With her having no income, it makes sense. But further, it does simplify things, and it keeps the family goals in mind. We intend to retire together at age 55, working on a plan to get there as one is easier than two. Same with budgeting monthly expenses. My brokerage accounts prior to marriage and both of our retirement accounts are separate, but everything else is combined. I even had her name put on the condo from prior to marriage.

    This is not for everyone. But I would recommend it for all married people, both working or not.
    =RBD

    • Being on the same page from the start is awesome! I wonder how many people make the decision on what to do with their money when they get married based on what their parents did. Probably the majority, right?

  4. Moneycone says:

    I actually commented about this in another blog (can’t remember which one!). Again, different approaches for different couples, but I would go against conventional wisdom and say – don’t combine finances.

    There are other ways to show your love and trust than combining finances!

    • It certainly does show a lot of trust to combine them though! Any specific reasons prefer to keep things separate?

      • Moneycone says:

        It isn’t about trust – I know my wife’s passwords and she knows mine and neither would mind if we did look.

        It just keeps things simple. I don’t need to know every little purchase my wife makes and vice versa.

  5. Michelle says:

    I don’t think there is one set rule for everyone. We have combined finances, but we have had it for years – so, we know that it works for us.

    • Finding what works as a couple has to be the most important part of the decision. I haven’t met many people who have combined things before getting married. What led you to combine finances before your wedding (which is a few months away if I recall)?

      • Michelle says:

        We already have a house and cars together, so marriage doesn’t mean anything to us besides signing a paper (we are not religious). We already act as though we are married, we are really only getting married to legalize everything.

  6. Mrs. PoP says:

    We went full combined as soon as we got married and I think it’s been the best way for us to work on combined goals together. As for income differences, I think that’s less of a problem when you combine finances than when you keep it separate. It’d be pretty crappy if one spouse could afford all the finer things in life while the other is eating the equivalent of government cheese. You also wouldn’t want to penalize a spouse for staying home if you have kids… or feel the need to “pay an allowance” in that case. That makes for a very weird dynamic. When you combine, it’s all just “ours”. It doesn’t matter who makes more or less, because it’s all for the home team.

    I think you’re missing something in this statement…
    “one pool of money there’s no real way to fairly split these things proportionately based on income.”
    When you’re working with one pool of money, these things aren’t split! It’s all for one and one for all! Except with only 2 musketeers…

  7. It is crazy how many people enter into relationships and marriages blindly as far as money goes and just hope for the best. You outlined some useful tips that are important to consider!

  8. After we got married, we immediately combined our finances because for me, it’s better to stay as one. And money is also not an issue with us.

  9. We combined our finances when we got married and it has worked great. Every married couple I know with separate finances (I know a lot of them!) has some sort of money problem. That includes my brother and his wife who are currently going through a divorce.

    Keeping separate finances must be really hard when you have kids too. Who pays for diapers? Daycare?

  10. I would suggest combining finances NOW. It’s great that you have similar financial goals and principles, but putting all of that into practice before the wedding is probably a good idea.

  11. I think this is definitely something worth thinking about before you get married. I have never considered not combining, once I find “the one”.

  12. I was just married and we are slowing combining finances, but are still going to have our own separate accounts. In our case, we are older (mid-30’s) and have a good amount of assets, so combining everything would be more trouble than it’s worth in our eyes. If we were younger and/or didn’t have anything, we would easily combine everything.

    As for the difference in incomes, one of us makes a decent amount more than the other. While the person making more picks up the tab more frequently, the other person helps out in other ways – takes care of the house, runs the errands, etc. When it comes to contributing to the family, you can’t just look at money.

  13. We have combined finances. My husband makes way more than I do, but we don’t think of it as his or my money, but our money. We work together to build our life together. It hasn’t been easy trying to communicate to each other, but I think it’s worth it for us.

  14. I don’t think either is morally right or wrong, but I’ll give you my opinion. Combine them 100%. I think it goes beyond dollars into trust. 2 flesh becoming 1, if you will.

    We don’t make the same income, but we don’t care. We have to see eye to eye on major purchases and our future either way. If you can’t do that, stress will follow. And combining accounts was easy too.

    Looking forward to your decision. Congrats on the marriage and savor every moment!

  15. Really what ultimately matters is the happiness of a couple. Whatever works for them that will make them happy and keep them both in good shape financially is probably the way to go, regardless of any overarching “rules” that people might try to apply. I say that while conceding that my own preference is combined finances.

  16. Brentoe says:

    I don’t see much reason to keep things separate. Later in life when you will actually get to spend the majority of the money you’ve saved, would one of you book a solo vacation and tell the other one to stay home because their account can’t afford it? At the end of the day the money gets spent on both of you and you’re in it for the long haul so it shouldn’t matter how it originally ended up in the account. I would love to hear of a husband or wife that books a vacation for him/herself after retirement and leaves the spouse behind because only one can afford it.

  17. The key is to find something that works for the two of you. My wife and I continue to keep our finances separate, but a lot of that is due to me working out of town all the time so it’s just too difficult to have them combined. Whichever way y’all decide, the big thing is to have checkups either monthly, quarterly, semi-annually to discuss concerns and goals and to keep the conversation open. If you’re wanting to keep them separate just to hide your money, it’s going to lead to other issues.

  18. Like JC, I think you have to find something to work for you. There’s no one big blanket answer; it depends on the couple.

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  20. Tim says:

    I think it is best to combine finances. There are many reason why I say this. For starters if you keep your finances separate you are really just living with the other person. If both people make 50k a year and you buy a house on both incomes then if someone loses their job does the other partner just say well your out of the house because you can’t pay your bills. Same goes for having a child. If one partner stays home they depend on the other partner.

    At the end of the day I recommend putting all your money into one pool and discuss any bill the two of you decide on. Yes, there will be some give and take. Besides doing this I think everyone couple should live on one income that way they are not dependent on the other income. If you do that you will be able to retire at a younger age, pay off your college loans, etc.

  21. I think the eventual goal should be to combine accounts. At least have one combined account. You guy are on the same team, and you should organize your savings that way :-)

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