Managing money as a couple

Emmia

Mark_d said:

Emmia said:

We have own accounts for our salaries and separate savings/investments. 

We both fund a joint account that pays the mortgage, and a separate joint account that pays for groceries. We also have a joint savings account to allow saving for house maintenance and similar "big"  costs.

How does the joint account for groceries work?  If you pay using credit card and pay the credit card from the joint account, your partner would only have visibility of the total credit card amount.

We literally have a separate joint current account which we fund from our main accounts. Just like we fund the mortgage account. So we both have visibility. 

We don't use credit cards for groceries

Mark_d

BrilliantButScary said:

Just as a matter of interest, when managing your finances as a couple, as the OP does, and it appears other posters, what happens in the following circumstances?

1. A disparity in income
2. An inheritance
3. If one person becomes a stay at home parent
4. Illness and disability

What factors led you to managing your finances in this way?

1.  I currently earn more than my partner.  Not too surprising given that I'm 4.5 years older.  As a consequence, my personal savings/investments are higher than my partner's but you'd expect this because I've been at working age for an extra 4.5 years.

2.  The person who inherits the money gets to keep the money with our way of doing things. On balance of probability, I'll receive inheritance before my partner does.  Whilst I wouldn't give my partner half the money, I would use it in such a way that we both benefit - such as upgrading our holidays.

3.  One person becoming a stay at home parent would need to be a joint decision.  We'd agree how to divide all  the income coming in to the family and then each family member would have ownership an responsibility over their own pot.  Might be simpler to deduct the joint bills and joint expenses before dividing the remainder.

4.  The agreement with my partner is that medical/dental costs are shared.  In the event of a major event that meant one of us was unable to work for an extended period then we'd need to review how we handle the situation.

A lot of thought went in to how we manage our money.  It's important to us that I'm not spending my partner's money when I buy a gift for my partner.  My partner works hard and is fairly successful in the work situation (thanks to my support and coaching) and has the right to spend the money earned, rather than needing my approval to buy items I feel are a waste of money.

QrizB

This was a MSE Money Moral Dilemma a couple of years ago:

https://forums.moneysavingexpert.com/discussion/6465539/money-moral-dilemma-should-my-partner-contribute-more-to-household-bills-as-he-works-from-home

Our solution is unchanged from then.

The QrizB household runs on strictly Marxist principles:
    https://en.wikipedia.org/wiki/From_each_according_to_his_ability,_to_each_according_to_his_needs
We have a joint account that receives our salaries, from which household bills are paid and from which we each draw an allowance for personal spending.

It might not work for everyone but it works for us!

CrickJon

Mine and my wife's salary go into a joint account.

Out of this account we move money into pots for bills and savings.

Anything left is for both of us to spend out of the joint account. I earn over 3 times as much as my wife, but it doesn't bother me. What's mine is hers. We both have personal accounts but don't really use them.

sausage_time

We share everything.  All income is paid into our main joint account and all bills are paid from there.  We have separate savings accounts for tax efficiency (and to exploit the best interest rates etc), but we view all the money as "ours" in any case.  We have separate credit cards for discretionary spending (birthday presents etc), but these are paid by direct debit from our joint account so we can see the monthly totals (just not the detail).  Most other expenditure comes from Amex in my name (with supplementary card - yes minor Section 75 risk) to maximise cashback.

Keeps it simple!

Mark_d

CrickJon said:

Mine and my wife's salary go into a joint account.

Out of this account we move money into pots for bills and savings.

Anything left is for both of us to spend out of the joint account. I earn over 3 times as much as my wife, but it doesn't bother me. What's mine is hers. We both have personal accounts but don't really use them.

I can see how this idea works for you, with you earning 3 times as much as your wife.  Doing anything else would likely increase inequalities and likely lead to resentment.
In my case my partner and I are equal in the relationship.    I earn 25% more than my partner - which isn't very significant.
If we put all the money into a joint pot then there would be no treat/luxuries unless they were agreed beforehand.  Whereas currently I can treat my partner to Champagne to soften the blow when returning from holiday.  I can spend £150 on a specific pair of trainers that I like the look of.  And likewise my partner is free to spend money on luxuries without needing any kind of approval from me.

Mark_d

sausage_time said:

We share everything.  All income is paid into our main joint account and all bills are paid from there.  We have separate savings accounts for tax efficiency (and to exploit the best interest rates etc), but we view all the money as "ours" in any case.  We have separate credit cards for discretionary spending (birthday presents etc), but these are paid by direct debit from our joint account so we can see the monthly totals (just not the detail).  Most other expenditure comes from Amex in my name (with supplementary card - yes minor Section 75 risk) to maximise cashback.

Keeps it simple!

I can see the benefits of doing it that way but when your partner buys you an expensive/overpriced gift, half of that money was yours.  Perhaps your partner buys some luxury hair products - since your money is being spent, don't you think the items being bought should represent good or reasonable value for money?  Maybe your partner is more of a spender than you, buying a coffee from Pret every day whilst walking past.  Do you think that's reasonable use of joint funds?

sausage_time

Mark_d said:

sausage_time said:

We share everything.  All income is paid into our main joint account and all bills are paid from there.  We have separate savings accounts for tax efficiency (and to exploit the best interest rates etc), but we view all the money as "ours" in any case.  We have separate credit cards for discretionary spending (birthday presents etc), but these are paid by direct debit from our joint account so we can see the monthly totals (just not the detail).  Most other expenditure comes from Amex in my name (with supplementary card - yes minor Section 75 risk) to maximise cashback.

Keeps it simple!

I can see the benefits of doing it that way but when your partner buys you an expensive/overpriced gift, half of that money was yours.  Perhaps your partner buys some luxury hair products - since your money is being spent, don't you think the items being bought should represent good or reasonable value for money?  Maybe your partner is more of a spender than you, buying a coffee from Pret every day whilst walking past.  Do you think that's reasonable use of joint funds?

Because the vast majority of our expenditure is joint (bills, food, mortgage, etc) any individual discretionary spending is probably only a few percent of the grand total.  Over the years, one then the other of us has been the top earner, we've just learned to let go.   Because we see the monthly totals, if one of us developed an expensive habit then you can be sure questions would be asked!  It's not for everyone, but works for us.

WillPS

My income dwarf's my wife's. It's been a long time now since dispensed with the need to try and make sure we were contributing equally to things financially as it held us back. All of our money is ours.

We each have 3 x Halifax Reward accounts, a Club Lloyds, a Natwest Reward and an RBS Reward.

We also have a joint Barclays premier, Nationwide FlexAccount, Virgin Money ClubM, Santander 123 Lite, Club Lloyds, Natwest Reward and RBS Reward.

The balances of these are all kept as low as possible and they are funded from a Chase savings account (in my wife's name). Any income is quickly moved in to that savings account, which also funds regular savers (mostly in my wife's name since she has vastly more tax-free allowance than I do). If there's a period where there is more than £1000 sloshing about in there then it gets moved to something higher interest - but we have so many regular savers now that these moments tend to be a month or two at most, and some months we have to leave some regular savers unfunded or minimally funded to ensure we have enough to cover bills.

Our spend is across 4 cashback/reward credit cards - prioritising highest rewards with each transaction. These are settled on the first of each month using Halifax debit cards. The majority of bills are paid out of the 123 Lite joint account (for now anyway).

daveyjp

All in one pot, all out of the same pot.