5 Ways Couples Can Share Their Finances

Financial tips

5 Ways Couples Can Share Their Finances

Posted by Infinite Wealth Advisors, LLC
7 months ago | May 6, 2019

You’ve probably heard that money is one of the leading causes of disagreement and even divorce. And yes, it is the leading cause cited in 22 percent of all divorces*. Financial discord is also one of the top three factors behind all breakups (including unmarried couples).

Clearly, no matter how much love exists in the relationship, finances can throw a monkey wrench your way. We’ve found that this can happen early in marriage, or that the issue can sometimes fester for decades. Since it’s never too late to reevaluate your financial arrangements and come to a new compromise, you might be interested in these different ways married couples are managing their money together.

Income is split, and each partner contributes to a joint account. You each keep half of your income, and deposit the other half into the shared account. This money is used for household expenses, whereas your personal account is all yours. This arrangement might work better for couples who earn similar salaries, because no one will feel like they’re shouldering an unfair burden.

Income is split proportionately. For couples in which one partner earns much more than the other, a proportional split might make sense. The amount of income deposited to the shared account is proportional to the amount each of you earns. If you prefer, the lower-earning spouse might find other ways to contribute financially, such as taking steps to save the family money.

Most income is pooled. Under this arrangement, each of you sets aside a designated amount of money in your own account, with the rest of your paychecks going into the shared account. You can each enjoy some financial independence, and avoid disagreements over personal purchases.

Use a written agreement. It might feel a bit odd, as though you’re creating a “contract” with your spouse. But when you commit the arrangement to paper, you can avoid future fights over misremembered details.

Set up separate retirement accounts. Each partner should open their own retirement account, even if you sincerely believe a divorce will never come your way. Retirement accounts confer important tax benefits anyway, and two accounts will just help you save for a more stable retirement together.

On that note, please give us a call to discuss your long-term financial plan. If you need help weighing your retirement plan options, we can help you analyze all potential paths to find the one that’s right for you.

*according to Institute for Divorce Financial Analysts

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