Personal Finance Advice

Some couples decide to keep their finances separate even though they are legally married. For some couples, it works. They keep their bank accounts separate, they have their own credit accounts, and they don’t share their money at all. They split the bills, either equally or in some other way that they both agree to. This can work well if both spouses have sufficient incomes, and can sometimes work if there is only one substantial income but the other spouse receives a set monetary amount from the earning spouse to cover bills and expenses.

Why do couples do this? Some couples just aren’t comfortable combining finances, especially if they are older and have already established their own financial standing. Another consideration is that some people simply do not want to lose the ability to have their own money and their own credit standing. This can be a viable concern because not having any credit in your own name can make it difficult to obtain credit down the road.

There are arguments against keeping marital finances individual to each person. Many people argue that when two people marry, they are supposed to combine every aspect of their lives and function as a whole unit as opposed to functioning as two parts within a unit. It may also be true that a couple can have much more success financially if they work together instead of separately with their money. There is also the consideration that one spouse may waste money with reckless abandon and the other spouse may not find out until that spouse is in serious financial trouble because of the financial secrecy the couple has.

Some couples have to keep their finances apart for viable reasons, such as when one person has flawless credit but the other person has a credit report riddled with delinquencies and other negative items. Applying for credit together in this instance would not make much sense because they would pay higher interest rates because of the one spouse’s horrible credit. In this instance, keeping finances separate -at least the credit portion of finances- works and makes sense.

Just because finances are separate, however, it does not mean that couples should be absolutely oblivious to where all the money is going. Each partner should know what the other person spends money on, what kind of bills the other person has, and how much money is sitting in the bank. The reason for this is obvious; even when finances are separate, the money situation of each individual affects the marriage as a whole.

This does not mean that a husband buying a shirt must report the purchase to his wife, nor does it mean that the wife should show an itemized list of spending to her husband after she returns from shopping. Instead, each person should be allowed a small review of what the other person’s money is doing. Does each person have enough money in the bank to cover bills? Are all the bills paid on time? How much debt does the other person have? These are all valid questions that should not be a mystery to either member of the marriage.

You don’t have to combine finances when you marry, although in many instances it can simplify things greatly. If you do decide to keep your finances separate, don’t allow this to turn into something where secrets abound within the marriage whenever the topic of finances comes up.