We spend huge chunks of our lives trying to acquire both love and money. At some point, though, we’d all kind of like to have both. And when you do—and you and your significant other have been living together in sweaty sin long enough—there then comes a time where your financial future becomes plural. It’s a bit of a minefield, but it’s a smart choice, and not without its satisfactions.
If you’re anything like an extremely specific version of me, your conversation might start around the fact that during various times of un- (and under-) employment, you (collectively) have picked up a little bit of credit card debt, and you have a bill coming for an appendix that went critical. You’re also in a long-term, monogamous relationship with shared decision-making on big issues and few to no skeletons in your respective closets. Well, you can tackle those debts slowly and pay interest, or you can open up your finances to each other and see if there’s a better way.
First, make a list of all of your incomes and expenditures, by pay period or month. This is—pencil-to-napkin—easy, but it requires you to be totally transparent about your earnings. If you want to hide funds, if you’re supporting an illicit second family on the side, if you’d feel better padding your figures—too bad. That stuff will come out, and when your partner finds out you’re defrauding them they will cut your throat in your sleep.
Once you’ve figured out how much money comes in the door and how much goes out, it’s time to figure out how much money goes to shared expenses, and how much individual Fun Money—for manicures and/or poker nights, let’s say—each person might use from a shared account. Here is where things can get tricky. Should you both put in the same amount for Fun, or should the higher earner pay more into the shared pool? I recommend, the latter. While the former can work within reason, it can also quickly create a Bolshevik Revolution in the bedroom, which is much less sexy than it sounds.
Once you’ve agreed to pool funds, you need to decide what constitutes a shared expense and total them up. Knock rent out first—you’ve now effectively prorated it by paying out of the common pool, then recurring shared expenses like utilities or drugs. What you’re left with is the rest of your life together—groceries, dinners, trips, subscriptions, nights out, movies, etc. Take a hard look at your purchasing habits to estimate your shared costs (you can always revise later), decide how much Fun Money you can fit in, and pick a shared contribution number that makes sense.
Wow, congratulations, you’ve just created a household budget in about the amount of time it takes to pick through a basket of fries, and both of you are alive and happy. That was easy! Now onto the scary and complicated thing—sharing accounts.
Joint accounts represent a pretty serious amount of shared trust. Unless you go full NORAD and require two sets of simultaneous passcodes, one of you can clean the other out at any time. This is a risk, but it’s a good one if your finances are largely entangled with your relationship. Do you really want to be with someone you can’t trust, anyway? Is potentially finding your significant other is a scheming fraudster worth a couple of grand? If you have doubts, or stuff you need to work on, maybe tackle that and then come back.
This is also not a knock on autonomy. You should both keep your personal accounts, both for our individual purchases and because giving anyone control of all your money is both scary and dumb as hell. It’s also good to have backups in case anything happens with your shared accounts, you can return to the Venmo Economy and sort it out with minimum strife.
If everyone’s on the same page, it becomes a matter of account logistics. For our shared accounts, we opted for the full trio, checking, savings and credit card (for what it’s worth, Capital One 360 + Capital One Quicksilver is a fairly good combo). Checking is mostly a float account for the credit card and cash-only purchases, and savings represents our slow-growing-but-growing emergency fund, which will almost certainly end up going to some shady real estate broker—c’est la vie.
When your pitiful bachelor salary becomes a robust Household Income, you’re going to want to celebrate, perhaps with a gilded champagne bucket for your bathroom or other nouveau baller accouterment. Excellent! The world is yours now.
But be careful. Purchases become more justifiable when you’re only footing 40-60% of the bill, and the lifestyle creep is very real. It’s easy to look at stuff you would have avoided before and say “fuck it” and ring them up. If one of you does that, it’s dishonest, if both of you do it, you can end up way worse off than before. It’s called the American Debt Trap, and it lulls you in with whispers of easy credit and promises of toilet champagne. You will resist, because you are strong, and budgeting is a game you can win.
Everyone needs a budget. There are plenty of easy ways to build a budget, and apps like You Need A Budget and Mint help you set a budget and then connect your accounts to track expenditures against it. For reasons that are unclear, I prefer to maintain a ludicrously complex spreadsheet with a graph that tracks budget against expenditures, emailing an updated version to my girlfriend daily like some sort of fiscal Rain Man. The important thing is that you find something that works for you so you can stick to it. The other important thing is that it has a surplus.
However we may feel about it, we in America are Capitalists, and that means our economic goals tend to require capital. We all need emergency funds. Some of us want enough for a down payment on a used Civic, some of us want a multimillion dollar loan from the Parental Trust to build a wheezing real estate empire and then attempt to create an America Where Nobody Fucks.
Either way, your budget should reflect the fact that some amount of saving is absolutely vital to your financial health. But it’s not all win-or-go-home. Talk to each other about your long-term financial goals. Find free stuff, long walks, bike rides, beach trips, and know you’re actively being thrifty and budgeting together. Budget in for extravagances and go on trips. Plan big purchases. Buy each other little gifts or flowers with your fun money to show you’re still an autonomous person willing to sacrifice for love.
Then go back, and look at your deranged hangdog of a budget spreadsheet, realize you somehow went over but you still saved something; you’re getting there. Look at the person you’re choosing as your partner in a vast and uncertain world and smile with the satisfaction of knowing you’re in it together. Netflix is a shared expense, the chill is free.