Couple sitting on porch.

They say that love is blind. But not so blind as to not notice when someone has wildly different ideas about budgeting, spending, and saving than you. When it comes to combining your finances with another person, specifically a significant other that you live with, there are some dos and don’ts that can help make it work.

Love is Forever (50% of the Time)

Let’s cut to the chase: half of all marriages end in divorce, and an equal number of relationships fail. Before you combine your assets with anyone, protect yourself and take it slow.

Start by Splitting the Expenses

Pretend the other person is a financial roommate, which they are. Split all the bills evenly based on each of your incomes. Sure, you could divide it up 50/50, but if your partner makes more than you, maybe a 40/60 split is more equitable. This will leave you both with an equal amount for savings, retirement, and discretionary spending.

Over time, you’ll both start to see how combining your money makes sense – or doesn’t. Especially if one of you is incapacitated and you cannot get access to their finances in order to pay rent or another bill.   

Next, Get a Joint Checking Account

Then use that account to pay all of your household bills and work toward your combined budget. It’s important that you both discuss purchases and how the joint finances are spent.

Open communication about money helps avoid resentment, hurt feelings, and misunderstandings. It also helps that you successfully stick to your approved budget and don’t run out of money.

Note: you might consider keeping your retirement savings, wireless bill, car loan, credit cards, and insurance payments separate until you get married.

Combine all the Expenses (and Pay Everything With Your Joint Checking Account)

Once you’ve developed good money-smart communication skills, it could be safe to combine all of your expenses. Plus, it could save you money, especially when you combine insurance coverage and wireless charges. Additionally, with both of you working together, you can more quickly build an emergency savings (in a joint savings account) or pay off high-interest debt such as student loans.

Take it to the Next Level

For some couples, this means joining all of your bills and accounts. For others, it’s a careful dance that mixes joint checking and savings but keeps personal retirement accounts separate. This can be smart if you’re not legally married, and therefore do not have full legal protection if the relationship ends. Just imagine if there is a devastating breakup and your ex withdraws all of your retirement savings. Because it was joint, you would not necessarily be protected.

Dating, Engaged, or Married with Kids (or Pets)

How you decide to split your financial obligations and assets is up to you and your partner. But the most important way to make it work is with good communication. Yes, we’ve mentioned communication a few times, and we’ll say it again.

Communication. Is. Key.

Splitting finances and paying bills is one thing, but encouraging your partner to start a business while you pay all the bills or deciding to start a family, buy a house, or travel the world together requires honest conversations and planning.

Start by setting a weekly financial meeting. At that meeting, talk about the budget, bills, savings, and your goals as a couple and as individuals. If you value shopping and they want to travel, talk about how to fit both of those into the combined budget.

Combine Your Finances at Rivermark

When you’re ready to take the next step, we’ll be here to help you both open a joint checking or savings account. We can even help with home loans, credit cards, and financial wellness recourses to help you build a budget and pay off debt together. Check out all your options online, stop by any branch, or give us a call at 503.626.6600 or 800.452.8502.