4 ways of managing your money in a couple and avoiding problems

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Money can become a recurring problem in a relationship….

When we are in a long term relationship, whether we are engaged, married, life partners or in a civil partnership, we can’t deny that money can be a recurring and contentious theme! All it takes is for one partner to earn more than the other, or for one to be a shopping addict while the other is a miser, to complicate matters…. Here are 4 ways of managing your common money to make relationship life more serene.

1/ For an independent couple

If you are independent by nature, both parties can keep their own bank accounts, like you did when you were single. There are two possibilities for managing joint spending: 1/ each person pays a percentage depending on their salary or 2/ you split the bills in two. But the person who earns more will be at a disadvantage…

The advantages of this system:

  • Each party is free to spend their own money as they choose.
  • If the bank blocks one account for any reason, the other person can help out.
  • No complications in the event of a separation.

The disadvantages of this system:

  • It’s difficult to keep track of joint expenditure.
  • If one of you does not manage their money well, they may find themselves unable to pay for joint expenses.
  • It is hard to put in place if one of you loses their income.
Credits : Pixabay Crédits : Pixabay

2/ For a couple who share everything

You’re head over heels in love since the moment you met, and couldn’t conceive of being apart for one second! You have closed your personal bank accounts to open a joint account. Both your salaries are paid directly into the joint account, and fixed expenditure comes directly out of it. It’s hard to get any easier!

The advantages of this system:

  • Tracking joint expenditure is very easy, because you know exactly where the money goes and how much is left.
  • You can divide everything in two (hobbies, restaurants, petrol, etc.).
  • You reduce your bank charges.
  • If one of you loses your income, it won’t cause increased problems.

The disadvantages of this system:

  • It’s difficult to surprise your other half without being caught out.
  • If your bank blocks you for any reason, you are both without any means of accessing money.
  • A break up is likely to be complicated….
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3/ For a typical couple

This is the most common technique among modern couples: two separate bank accounts and one joint account. There are many options for managing this: 1/ Each person puts a fixed amount into the joint account for common expenditure and they keep the rest for their personal spending, or 2/ Each person lodges their salary to the joint account and transfers a fixed amount to their personal account for their own expenditure. 

The advantages of this system:

  • Each person has the money that remains in their own personal account to spend as they wish.
  • You can easily surprise your other half without unusual activity on the account being detected.
  • If one of the accounts gets blocked, you have two others to rely on.
  • In the case of a break up, you simply need to close your joint account.

The disadvantages of this system:

  • You half to manage three different accounts and their associated paperwork!
  • You have bank charges on three accounts.
Credits : Pixabay : AdinaVoicu

4/ For typical but independent couples

Are you the kind of couple who don’t want all your money going in to one account, but you are not against sharing some of your finances? Go for a joint account and a separate account: designate the “accountant” in the relationship, and this person will manage the joint spending (as will as their own personal spending) from their personal account, which becomes the joint account. Each month, the other person makes a lodgement to their partner’s account, corresponding to the joint expenses.

The advantages of this system:

  • You only have two accounts to manage.
  • You can surprise each other without being rumbled!
  • If one person can’t access their account for any reason, the other account is there to help out.

The disadvantages of this system:

  • The responsibility falls on one person to manage the finances.
  • If you separate, you will have to balance the books….
Credits : iStock