This week I had dinner with my girlfriends. One’s pregnant, one’s getting married in three months, and the other one is a newlywed pursuing her MBA. As it’s been happening lately, all these major life events taking place in each other’s lives have made our get-together’s full of grown-up talk. Perfectly normal I guess, but still a bit… funny!
During our very real, grown-up conversation many topics were touched, but one in particular brought some controversy. Mainly because there is no black or white solution, but a lot of gray-tone approaches to “how to handle finances with your partner”. We each had our own perspectives and ways to handle this, but we all came to one very unanimous conclusion:
Discuss finances with your partner. The sooner, the better. Find an approach that works for both of you. If necessary, consult with an expert. Speak up! Your relationship deserves at least that.
Every case is different, but generally speaking here are two approaches that I like and usually recommend:
- Then & Now Approach: The “then” bills are the ones you’ve each arrived with like student loans, car payments, etc. and the “now” bills are the ones you start acquiring together. Basically once you have categorized each, any “then” bills are obligations you each pay separately, and any “now” bills you split 50/50.
- Proportionately: You can also factor in both your incomes, get a total and then distribute a percentage. Next step is to list all your expenses and then using the percentage you came up with from your incomes, that’s how much each partner needs to contribute to cover expenses. Any remainders are for each to keep, and spend or save as they please.
Once you are both clear and happy with an arrangement, then use all the tools out there available to assist with budgeting, etc. I have added some links on the main page of the blog to some of my favorite tools. Feel free to browse and also share your thoughts and ideas regarding relationship finances.