7 steps to successfully merge finances with your significant other

  • When it comes to combining finances with your significant other, it’s critical to determine a budget and discuss your long-term financial goals.
  • Set goals early and often, and map out a plan that includes joint accounts for shared essentials and separate accounts for more “fun” purchases. 
  • You’ll likely experience major life changes as the years go by, so regularly revisit your combined finances to reassess and adjust. 
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I like to tell the story that on my first date with my now-husband, I decided I was really into him based on two topics in our meandering conversation: old limos with blue velvet interiors and spreadsheets. Little did I know, but that conversation would be an analogy for our discussions two years later while combining finances. 

I’m the free-spirit who enjoys buying cheap and quirky things that I don’t mind losing when they wear out quickly or I get tired of them… Meanwhile, my husband Ryan is the finance guru who prefers to save up and buy something expensive that lasts — and then take damn good care of it to ensure that happens. How in the world were we going to make this work? 

“[W]e almost always marry our financial opposite,” David Bach, author of “Smart Couples Finish Rich,” told Forbes. “You’re either born to save or you’re born to spend, and financial opposites attract. That can lead to enormous power struggles and trust issues and regular fights.” 

But it doesn’t have to be that way. We have had our share of “discussions” (okay, sure, a few would be more accurately categorized as fights), but fast-forward three years and I’d say we’ve got a good routine going for us. And wonder of wonders, most of the time, combining finances is actually fun! But when we make our budget, set goals, and meet them, it often feels like we’ve summited a mountain to find a party in our honor. 

So, how did we get from there to successfully combining finances? We were older when we met and both had established careers, so we had the luxury of combining two good incomes. Not everyone has that. But these basic principles can help you start wherever you are.

Set goals for your happily ever after

We started with the big conversations. What do we want retirement to look like? What do we want our lives to be like between now and then? Are we having kids? In a lot of ways, this was taking advantage of the normal desire to plan our lives together, but we put numbers to everything and came up with workable financial plans. 

Take advantage of combined income right away

We’d just become DINKs (dual income, no kids) and wanted to take advantage of the excess income while it was new and focus on combining finances that way, too. Since our goals included providing for JJ+RW=4eva, we started by estimating what we’d need for retirement and putting as much as we could afford toward that goal. We both increased contributions to our 401(k)s and opened a brokerage account that would give us more flexibility if we wanted to retire early. Then we calculated how much we’d need in emergency savings and started adding to that as well. 

Focus on the essentials

Moving in together decreased our expenditures, so we mapped out our new reality with budget categories for the essentials. This sparked conversations that weren’t nearly as fun as daydreaming about all the trips we’d take in retirement. Is Ryan’s monthly haircut essential? What about my weekly lunches with friends? They sure seem essential to me. The electric bill was easy enough to agree on, but we went round and round about some of the categories. As a way to mitigate some of this, we moved on to step four. 

Focus on the fun

We each opened (or kept) individual accounts for “fun money,” one of the ways we strayed away from couples finances. A portion of our paychecks are directly deposited into these accounts and we spend them however we like. Some of the contested categories for essentials (and an accompanying amount) were moved to this section. For instance, if either of us buys a meal when we’re not dining together, it comes from fun money. 

Plan for “extra” money

Ryan gets bonuses through his company with some regularity, and I do side gigs of various sorts. Initially, we didn’t factor these things into our budgets and disagreements arose about how to handle them. Eventually, we agreed on a percentage: 25% of any money outside of our normal paychecks goes to our individual accounts, and the remaining 75% goes to the joint account. We categorized the extra income as a “reward” of sorts, so it feels like that to the awardee. However, all that “extra” adds up, and we didn’t want to fritter that away. 

Revisit regularly

In the last three years, we’ve had a kid and bought a bigger house, both of which come with plenty of ways to spend money. At least every six months, we look at the budget and recalibrate our categories. Are we overspending on dining out? (Not right now!) Have we finished paying off this item we bought on 0% financing? We also revisit when we need to make big decisions, like do we put our son in daycare part-time or full-time, or can we afford to do that remodel we’ve talked about? 

Have fun

We’ve had our fair share of fights about money, but overall, it’s a fun way for us to connect. We use it as an opportunity to revisit our dreams, make new ones and accomplish goals together. 

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