Marriage is more than just the joining of two people. For nearly half of all married couples, it also involves merging financial accounts.
According to the fifth annual Love and Money survey from TD Bank, 47% of married couples merge their spending and accounts after getting married. The majority (57%) share bank accounts, while two-thirds share at least one credit card.
Marriage often involves a lot of compromise, and so do shared accounts. If you're considering merging money with your spouse, here are a few guidelines to consider.
Set a Spending Limit
When you're single, you might decide to go on a shopping spree, splurge on concert tickets, or take a last-minute vacation without checking in with anyone. But when you're married and sharing accounts, your spending doesn't affect just you anymore – it also impacts your partner.
Nobody wants to ask permission every time they buy a coffee or the latest book by their favorite author. That's why many couples set a spending limit. For example, if a purchase will cost more than $100, first check in with the other person.
The dollar limit you decide on will depend on your unique circumstances, including your earnings and overall budget. According to a survey from Today.com, around 36% of couples feel comfortable spending $50 to $99 before consulting their spouse, while another 22% set the bar between $100 and $499.
Work with your partner to find a limit that feels right to both of you. Then, if you want to buy something over that amount, talk about it first. This method may reduce the amount of time you spend justifying past purchases or arguing over money. It can even help you avoid impulse purchases on things you don't really need.
Get an Allowance
Is having just one checking account a little too close for comfort? If your spouse questions every purchase you make – no matter how small – or ruins their own birthday surprise by monitoring your transaction history, you might want to keep some of your money separate.
For some couples, it makes more sense to have three checking accounts: a joint account for paying bills and covering other mutual expenses, plus separate checking accounts for each partner. With this method, you'll transfer your "allowance" from your joint account to your individual accounts, and that money is yours to spend, no questions asked.
Again, the amount you allocate to each account will depend on your overall financial picture. Having three checking accounts increases the complexity of your financial situation, but the trade-off may be worth it if you and your partner have trouble seeing eye-to-eye on money.
Focus on Communication
The most important aspect of merging finances with your spouse is to keep the lines of communication open.
Consider having regular "money dates" to review your budget and talk about your savings goals. Whether you meet weekly or monthly, these meetings can help you establish a habit of talking about your finances rather than waiting to talk when a problem has surfaced.
You may face financial challenges in your marriage but agreeing on how you'll spend and save the money you share can prevent a lot of disagreements down the road. Don't be afraid to reevaluate things occasionally to make sure you're both comfortable with the current situation. If not, you can always work together to come up with a new plan.