Options for Handling Finances in Marriage
Generally the best way to handle family finances is the one you’re most comfortable with–not only from a financial standpoint but also from one of trust, commitment to the relationship, and the likelihood you’ll stay together permanently. Here are your options for handling finances in marriage:
- Keeping Your Money Separate
There are benefits to keeping your money separate:
- You maintain the ability to make financial choices without having to ask your partner.
- You can avoid future money disputes if the relationship doesn’t work out.
- You aren’t financially dependent on your partner.
- If you make less than your spouse or partner and you share expenses equally, a larger percentage of your income will go toward paying household expenses.
- Combining Your Resources
A joint account works only if you make financial decisions together. If one partner dominates money matters or takes advantage of shared finances, it could lead to resentment. Here are ways to help avoid trouble:
- Keep a record of monthly expenses.
- Decide who’s going to pay the bills and which expenses will be paid from your joint account.
- Decide how much money each of you can withdraw from the joint account on a monthly basis.
- A Blend of Both
Benefits of having joint and separate accounts include:
- Each of you can contribute to paying household expenses in a way that’s proportionate to your income.
- If each of you has children from previous relationships, each of you can pay for your own children’s expenses.
- You can decide which expenses you’ll pay for together, such as a mortgage, vacations, everyday expenses, or unexpected emergencies.
- Before making any decisions, discuss each of the options with your spouse or partner and what you’ll do if it’s not working out. And no matter which option you choose, the most important thing is to make sure your entire family’s needs are being met.
The Prudential Insurance Company of America, Newark, NJ