Buzz
Many people believe that combining finances is a natural step when you marry or cohabit. While this works well for many, it's not ideal for every couple. In certain situations, it may be more practical to maintain separate financial accounts.
If you and your partner have very different attitudes toward spending, Credit.com recommends:
There are different ways to manage finances separately: For shared expenses like the mortgage and utilities, you can set up a joint account to which both contribute. Each person can keep their personal funds in their own account. When it comes to saving, you might save individually, yet still have mutual goals, such as both contributing 10% of your salary towards retirement
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Financial advisor Laurie Itkin advocates for a similar strategy. In an interview, she shared that she's quite frugal, while her husband tends to spend more. To strike a balance, they maintain a joint account for shared expenses, as well as individual accounts for personal spending. Naturally, they agree on the amounts for each account.
You might want to keep your finances separate if you're not sharing any debt. For instance, if one partner enters the relationship with significant student loan debt, they may feel it's their responsibility to manage and pay it off, which could be more easily done with separate accounts.
There are strong arguments on both sides of this issue. Ultimately, the choice is personal and should be based on your relationship and financial circumstances. There are valid reasons for keeping finances separate. For more information, check out Credit.com's full article.
Photo by Ed Yourdon.
