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The way you manage money as a couple can evolve over time. In a new relationship, you may keep accounts and finances completely separate. Over time, moving toward jointly managed finances can work as understanding and trust builds.

Getting to know each other’s money management style will be important in developing a system that works for both of you. Determine if you are primarily a saver or spender, frugal or extravagant, cautious or careless. If your approach to money matches, things will be easier to negotiate. If your money management styles are very different, identify the areas in which you will agree and disagree to head off problems before they start.

Good communication, openness and transparency are key to successfully managing a common financial life and keeping arguments over money to a minimum. Even if one spouse or partner generally manages the finances, it is not a good idea for the other to be totally in the dark. Agree together on the overall family money plan and review the details on a regular basis. Good money management is the responsibility of both parties.

The first step to effectively managing money as a couple is to get organized. Get copies of your bank and investment account statements, property deeds and vehicle and other equipment titles. Find your mortgage paperwork, outstanding credit card balances and all other debt information. With these items in hand, you can prepare a net worth statement for each of you. Next, write down your monthly income and expenses by category. Understand what is necessary and what is discretionary. Developing a budget that fits into your joint income will be important.

Next, get a copy of your credit scores. Do not open joint bank accounts or take on joint debt if one of you has a bad credit score. Be aware that you will be “co-scored” if you comingle your finances.

Establish financial goals and priorities as a couple. Determine what you need to save and invest to put your children through college and for you to retire. Agree on large purchases, like a house, vehicles and vacations. Knowing what you can afford today and what you need for the future will be helpful in avoiding arguments.

Depending on how far you as a couple choose to integrate your finances, opening a separate bank account may make sense to pay joint bills, such as a mortgage, utilities, groceries, travel and others. If you open a joint account, know you are both responsible for overdrafts and that both of you could withdraw funds from it. Agree on how much and when each of you will contribute to the separate account.

Keeping some financial separation may be good, but that is a personal decision each couple must make. Maybe you each keep your own bank account and credit card. If this is your choice, perhaps, after you agree on spending limits, you do not need to check in on every item you purchase. Agree to pay your credit card balance fully each month to avoid “debt creep” and unnecessary interest charges.

One partner may be the main earner, or incomes might be significantly different. The main earner can consent to transfer an agreed amount to the other so he or she also has funds to spend. A stay-at-home spouse or partner is working too by managing the household and, as the case may be, taking care of children.

There is no right or wrong approach for all couples. Remember, you are a team. Work together to figure out the best way to handle money.

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Connie Brezik is a Casper-based wealth advisor with Buckingham. Her email is cbrezik@bamadvisor.


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