Ask Me Help Desk - Merging finances

Merging finances

Recently, there has been some disturbance in my home about the merging of finances.

I would like to hear how other couples have made it through the transition of yours/mine into ours.

Any suggestions on how to merge when one is further in "debt" and has a lower income and the opposite partner has higher income and no debt?

Hi Justwantfair,

Dealing with finances can be a real sticky situation. My boyfriend moved in with me about 4 months ago, and we combined finances even though I make more and he has slightly more debt. In our relationship we didn't compare apples to oranges; as we are looking to have a future together (get both of our debts paid off, no matter who has more, eventually buy a home, and hopefully marriage). I guess we didn't really have a problem because we both trust each other and have the same mutual goals in mind. We also have the 'What's mine is yours' mentality too.

Does it ever work out to keep splitting bills?

My opinion is having finances shared, as I have always done, his opinion is to split expenses... which he has always done.

Primarily, the biggest concern is an overload of attorney fees that are spilling over from a long standing custody battle. Just want some insight because right now, the finance situation seems like a deal breaker.

Logically, you should only be merging finances after you get married.

Otherwise, if you do merge finances before marriage, you better have a way out in case you break up.

So while living together just split the bills?

My partner and I merged finances years ago. It's really important to have similar values where money is concerned, at least in my opinion. Neither my partner or I had any debt. We never carried a balance on our credit cards, etc. Money is one of the main things that split couples apart. If you're both pretty similar in your spending and saving habits, and plan to be together long term, then go ahead. If not... disaster awaits!

Edit:
I don't think differences in income should figure too heavily into this, as long as the spending/saving habits are similar.

So after five years, I will never get a marriage out of this deal... pretty sweet for him. :D

The word marriage makes some of us guys tremble with fear... :cool:

Now why is that KC? ;)

My wife and I were independent individuals before we got married and, by my suggestion, we continued it after marriage. We have our own accounts at the same bank. We made a spreadsheet of our monthly expenses and we split it based or percentage of take home (she makes more than I). We share a mortgage account which aorks well for transferring money around. 10 years later we've had to tweak it slightly but it works well. She has her own credit cards and I have mine.

Quote:

Originally Posted by kctiger

The word marriage makes some of us guys tremble with fear...:cool:

Well shoot, if we aren't merging finances pre-marriage and he earns twice what I make and we are splitting bills, I think I maybe putting myself in for another five year standoff.

Perhaps you guys should use the weighted average approach... it is a more fair way of doing things without completely merging finances.

Quote:

Originally Posted by NeedKarma

My wife and I were independant individuals before we got married and, by my suggestion, we continued it after marriage. We have our own accounts at the same bank. We made a spreadsheet of our monthly expenses and we split it based or percentage of take home (she makes more than I). We share a mortgage account which aorks well for transfering money around. 10 years later we've had to tweak it slightly but it works well. She has her own credit cards and I have mine.

See this is his idea that he wants to go forward with. But we currently do an even split of all of the household bills, including groceries. While his current income is twice mine. So I guess that is getting under my skin as far as splitting bills goes.

We don't split the bills evenly, we do it by percentage of take-home pay. If our montly take-home pay is $2000 and hers is $1200 of that then she pays 1200/2000=60% of the bills and I pay 40%.

Sounds a lot more fair. Now I just head back into the financial conversation... with a new compromise in hand... ::cross my fingers::

My fiancé and I have shared finances, separate accounts(for now) until everything is straightened out with her job. We are planning on getting a joint account mid June. We doing share a savings account currently though, in my name for reasons dealing with welfare.

My advice, if your spouse has the same type of outlook on money, then sharing finances isn't a bad idea. However if you differ, then separate is the way to go.

For example, my fiancé and I are both against needless spending, so saving money is not a problem and both consult each other on what needs to be bought and what is a luxury.

A friend of mine and his wife, are the opposite, he spends money without any thought to rent, bills or anything. She wants to save for a house and be able to pay bills. They were joined account that has now been forced to go separate.

Quote:

Originally Posted by Justwantfair

Well shoot, if we aren't merging finances pre-marriage and he earns twice what I make and we are splitting bills, I think I maybe putting myself in for another five year standoff.

Yikes! That's not fair!

Here's a possibility. You keep your separate bank accounts, but you create a new joint account. Every month you each put in a fixed amount, let's say $1000 each. So every month you have $2000 to pay for all the bills that you have. If there is extra money, it carries over to the next month. So in one year, you each put in $12000 for a total of $24000 to pay for all your bills. That way, everything is evenly split. If you break up, all you have to do is split the money in that account in half and each get back their equal share.

Me and my fiancé do things differently.

He pays the full amount of rent and car payments. I pay the electric, cable,phone (home cell), and car insurance. We split the grocery bill and pay our own credit cards bills.

This works for us but you and your fiancé have to work out a plan that works for the both of you.

Quote:

Originally Posted by Romefalls19

My fiance and I have shared finances, separate accounts(for now) until everything is straightened out with her job. We are planning on getting a joint account mid June. We doing share a savings account currently though, in my name for reasons dealing with welfare.

My advice, if your spouse has the same type of outlook on money, then sharing finances isn't a bad idea. However if you differ, then separate is the way to go.

For example, my fiance and I are both against needless spending, so saving money is not a problem and both consult each other on what needs to be bought and what is a luxury.

A friend of mine and his wife, are the opposite, he spends money without any thought to rent, bills or anything. She wants to save for a house and be able to pay bills. They were joined account that has now been forced to go separate.

We are and aren't on the same page about finances. He keeps a huge gambling fund going, which he can afford, but in the current circumstances is creating additional animosity between us.

Neither of us, outside of the gambling fund, are huge frivilous spenders. We prefer to save.

Quote:

Originally Posted by I wish

Here's a possibility. You keep your seperate bank accounts, but you create a new joint account. Every month you each put in a fixed amount, let's say $1000 each. So every month you have $2000 to pay for all the bills that you have. If there is extra money, it carries over to the next month. So in one year, you each put in $12000 for a total of $24000 to pay for all your bills. That way, everything is evenly split. If you break up, all you have to do is split the money in that account in half and each get back their equal share.

The problem is my income is substantially more limited then his. So each contributing equally is not working and especially contributing equally in excess.

Quote:

Originally Posted by Justwantfair

The problem is my income is substantially more limited then his. So each contributing equally is not working and especially contributing equally in excess.

So what do you want? Do you want him to loan you money interest free so that you can repay your debts. Then repay him slowly. Once you repaid him, you can start paying your share equally?

If you can't keep up with 50/50, then what's the point of merging finances? Is he willing to pay most of your bills? What's in it for him if you merged financially?

Quote:

Originally Posted by I wish

So what do you want? Do you want him to loan you money interest free so that you can repay your debts. Then repay him slowly. Once you repaid him, you can start paying your share equally?

If you can't keep up with 50/50, then what's the point of merging finances? Is he willing to pay most of your bills? What's in it for him if you merged financially?

Gee I wouldn't know, I would think that merging financially is what couples would do. I am not sitting at home running up all the bills I can. I just don't imagine the future works well with Mine/Yours never Ours. If we are splitting bills, to me that means roommates, not a relationship. There shouldn't have to be anything in it for him to merge.

Why should I be expected to keep up with 50/50 when my income is less than his and my personal expenses are greater at this time? I want to be with someone who doesn't put $20 in my gas tank and put it on my tab at the end of the month because he makes twice my income.

Also, it isn't debt, it is currently running attorneys bills that we are talking about, I am not asking him to pay my debt.

Quote:

Originally Posted by I wish

So what do you want? Do you want him to loan you money interest free so that you can repay your debts. Then repay him slowly. Once you repaid him, you can start paying your share equally?

If you can't keep up with 50/50, then what's the point of merging finances? Is he willing to pay most of your bills? What's in it for him if you merged financially?

And Liz28

I have been a member for a long time and I am looking for a solution other than ending a five year relationship. I didn't asked to be attacked for asking for assistance, but thanks anyway.

Quote:

Originally Posted by Justwantfair

and Liz28

I have been a member for a long time and I am looking for a solution other than ending a five year relationship. I didn't asked to be attacked for asking for assistance, but thanks anyway.

Wow, I been a member of this site a long time too and would like to know where and when on your thread, or any other thread, I attack you?

I would do as NeedKarma suggested and use a weighted average system revolving around your percentage of income... I think that makes a for a fair situation... it levels the playing field, so to speak, if he isn't ready to totally combine income.

Quote:

Originally Posted by liz28

Me and my fiance do things differently.

He pays the full amount of rent and car payments. I pay the electric, cable,phone (home cell), and car insurance. We split the grocery bill and pay our own credit cards bills.

This works for us but you and your fiance have to work out a plan that works for the both of you.

And here is by original post on page 2, I see no attack.

I think when you agree with questioning why I wouldn't be comfortable in a 50/50 set up and say you don't get it... I didn't ask you to get it, it bothers me as a person and I would expect that I am not asking everyone to "get it." I felt like that was an attack.

Quote:

Originally Posted by Ren6

My partner and I merged finances years ago. It's really important to have similar values where money is concerned, at least in my opinion. Neither my partner or I had any debt. We never carried a balance on our credit cards, etc. Money is one of the main things that split couples apart. If you're both pretty similar in your spending and saving habits, and plan to be together long term, then go ahead. If not....disaster awaits!

Edit:
I don't think differences in income should figure too heavily into this, as long as the spending/saving habits are similar.

He makes close to $75K per year and I make closer to $32K, I think it is a substantial difference to take into consideration, but maybe because I don't earn as much as he does.

Quote:

Originally Posted by Justwantfair

I think when you agree with questioning why I wouldn't be comfortable in a 50/50 set up and say you don't get it... I didnt ask you to get it, it bothers me as a person and I would expect that I am not asking everyone to "get it." I felt like that was an attack.

Sorry, it wasn't intended to be an attack. We are very confused as to what "merging" means. Sounds like you want to put both your money and debts together into one pot and go from there.

Keep separate accounts. But create a joint account to pay common bills. If you do not believe that you are spending 50% of the bills, then reduce it to 10% or however much you believe is right for you.

I agreed with I Wish on the point he made "f you can't keep up with 50/50, then what's the point of merging finances?". And I wrote his comment box "I don't get it either" and that is consider an attack on you. Okay, I get it now.

Quote:

Originally Posted by liz28

I agreed with I Wish on the point he made "f you can't keep up with 50/50, then what's the point of merging finances?". And I wrote his comment box "I don't get it either" and that is consider an attack on you. Okay, I get it now.

It's not really that I can't "keep up" with 50/50, but it is VERY difficult to be the person in a relationship who can't go out or have any personal money while her partner is out spending money when and where ever. I was looking for suggestions to help so this isn't something we break up over.

I think Need Karmas idea is the best for non married couples, and whether you believe it or not, it makes a difference in the eyes of the law, and splitting personal property, and accounts.

Ideally you should throw it all in the pot, pay all the bills, and split the rest between you, for your allowances, to do as you will. That's how we have always done it.

I think it starts with a budget, that's shows where the money does go, and build from there. When I was single we paid our own freight, and lived within our means. (separate accounts and obligations)

Who has the biggest bills any way?

Quote:

Originally Posted by talaniman

I think Need Karmas idea is the best for non married couples, and whether you believe it or not, it makes a difference in the eyes of the law,

We are married and it actually doesn't make a difference in the eyes of the law here in Canada anyway. My wife is (well was up until last year) a family lawyer so I've learned a few things from her.

Quote:

Originally Posted by talaniman

Ideally you should throw it all in the pot,

There is no "ideal" situation, couple do what's comfortable for them.

Quote:

Originally Posted by talaniman

I think Need Karmas idea is the best for non married couples, and whether you believe it or not, it makes a difference in the eyes of the law, and splitting personal property, and accounts.

Ideally you should throw it all in the pot, pay all the bills, and split the rest between you, for your allowances, to do as you will. Thats how we have always done it.

I think it starts with a budget, thats shows where the money does go, and build from there. When I was single we paid our own freight, and lived within our means. (separate accounts and obligations)

Who has the biggest bills any way?

We have found some common ground after a many lengthy conversations this weekend, tonights conversation went alot better. I know that the primary financial struggle is my custody fees that pile on faster than I alone can maintain them. Faltering in paying them could mean horrible repricussions to the ending verdict.

I feel like although it's about money to me, it's also about having someone running an expense account in a relationship for any expenses, down to gasoline that they pay on the other's behalf. Although I was considering his side of the issue with the attorney bills being mine only, after five years, I expected more of a partnership then I was getting.

Needkarma's solution was the best compromise that we could have between us for some common ground. I know that finances can destroy couples and I have always had a more generous nature, not mentally calculating who is ahead (and I have been in relationships where I was the bread winner) and his way is very it's your responsibility. I think that is what hurt more then living by a separate (one non-existant and one existant) personal allowances. From a couple who had previously spent their time going out to play poker together, to one partner who can still afford it and the other partner struggling to make ends meet.

We will make it through this. Thank you for the solutions and input. I realize every couple is different and what works for some, won't work for others. I was looking for the solution that might work for us. Thanks.