Managing finances as a couple

I came across this 👇 post on Instagram, which made me think of how complicated some couples’ finances can be.

Many people don’t merge their accounts at all despite being together for a long time and get involved in paying random bills without the full transparency of their financial situations. This can also build resentment and create a lot of arguments down the line.

Other couples don’t talk about money at all and just fall into weird money arrangements. How can you actually plan your future without discussing money regularly?

This honestly surprises me. Or maybe not, since money is the topic we, Brits 🇬🇧, tend to avoid overall.

Splitting joint expenses 

Equal vs fair ⚖️

When it comes to splitting joint bills and mortgage, 50/50 might sound like a good solution, but there’s a high chance both people don’t earn the same salary. Things can also change a lot as time goes on.

It turns out, only about 40% of UK couples split the bills proportionate to their income with majority (51%) splitting everything down the middle.

The lower earner can often feel their relationship is financially unequal because they are contributing a higher proportion of their pay when splitting everything 50/50. They may have a lot less disposable income left when the other person might be really comfortable.

Sure, it may sound equal to arrange your bills this way, however, is it fair?

Women especially tend to take career breaks to bring up children resulting in generally lower income when they return to work, so splitting bills proportionately could really help making the financial aspect of the relationship fair.

To join or not to join 🖇️

One of the best ways in my opinion to manage money as a couple is to have a combination of personal and joint accounts. This is currently how we manage our financial situation and it’s honestly helped us feel good about money.

Here’s how it works.

Joint - for all the bills and spending together. You could also have joint savings for your short and long term goals. This is where you put in a proportionate amount of money to your earnings needed to cover all the monthly outgoings.

Personal - each person has their own money to spend freely on things they enjoy, they can also save and invest as they wish.

This is the best of both worlds in my eyes. You can have your joint financial goals and commitments while allowing for personal freedom and security. This kind of arrangement really cultivates interdependence, which is a key pillar for a strong relationship.

Communication is 🔑

Lastly, all of this might not be possible without good communication. Regular check ins and money dates can help facilitate the right conversations and make it easier to talk about money which can often be a difficult subject.

It can also help to be transparent of each persons financial situation and any changes in circumstances can be factored into how you split the bills in the future. 

Successful couples tend to work on financial goals together - they discuss savings and big purchases or lifestyle changes. 

My weekly recommendation

Since we’re on the topic of couples finances, here’s a pretty solid example of how Emma Edwards from The Broke Generation (hello its us!) manages money with her partner.

Until next time ✌️

Lina at Money Blues