Money and marriage — managing your costs as a couple
Managing finances together in a marriage can be tricky, but following a few simple steps can take the pressure off. Read on to discover our guide on couple’s financial planning
5 min read
Congrats — you’ve taken the plunge and decided to say ‘I do’! Whether you’ve been cohabiting for years or just moved in together, a core part of any marriage is deciding how to manage your money. Sure, it’s not the most romantic topic, but building a solid plan for your collective finances based on mutual trust helps keep things running smoothly. If the topic of money and marriage has you feeling stressed — fear not! We’ve collected some expert tips to help you get your nuptial finances in top shape so you can focus on living the dream.
When it comes to finances and marriage, communication is key
Managing your finances with someone else requires a great deal of communication and trust. Even the most compatible couples can have markedly different attitudes to money, so it’s important to approach the topic of your marriage finances openly and honestly. Here are a few things to keep in mind:
Keep it personal: There’s no one-size-fits-all rule when it comes to marital money management. For example, some couples believe in combining their finances, while others prefer to keep things more separate. Before you decide how to tackle your finances together, it's a good idea for each of you to define your individual values and goals when it comes to money. After all, if you aren’t clear about what your own financial wellbeing looks like, it will be hard to stick to your financial goals as a couple.
Check in regularly: Marriage is — ideally — for the long-haul, and things may change along the way. From job losses to welcoming children, your financial life will likely evolve over the course of your marriage. That’s why it’s important to make time to talk about your shared costs and money goals regularly, so that you know you’re both on the same page. After all, money can be a stressful topic, and it’s important to ensure that you and your spouse are feeling good about your finances—both together and individually.
Compromise is key: Sharing your life with someone also means sharing your finances to a certain extent. Given this, it’s important to be flexible and find common ground, even if your views on money may be different. Perhaps you’re more on the frugal side, while your spouse tends to splurge — great! Maybe you’ll learn to let loose once in a while, or perhaps you’ll give your partner the motivation to save more. With effective communication, you might find that you have a positive influence on one another.
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You may want to take the trip of a lifetime, invest in your family, or plan for early retirement. Whatever your goals are, work together to decide on some joint objectives and clearly set out what you both want to achieve in the long term. Whether you’re newly married or revamping your family finance plan, sitting down and making a money wishlist is a great exercise to do together.
2.List your shared and individual costs
As a married couple, it's a good idea to write down all your collective expenses, such as electricity, water and gas bills, and rent or mortgage payments. This may also include dinners out together, or vacations you’re planning. However, most of us have individual expenses — such as new clothes or nights out with friends that may not fall into the marriage pot. Figuring out which expenses belong to shared costs can help avoid problems down the line.
3. Contribute what feels right
Every marriage is different. Some couples earn roughly the same, while others have disparate incomes, and one partner might have no income at all. What we earn depends greatly on our capacity for work, whether or not we have kids, and other factors. So when you’re divvying up your finances, be mindful of who has the capacity to contribute how much and what feels fair for both of you in your current circumstances. Remember, the decisions you make now aren’t set in stone!
4. Decide how to tackle your expenses
There are three main ways to manage money as a married couple — keep your finances separate with individual accounts, pool your finances together in a shared account, or combine the two with both joint and separate accounts. The table below presents some pros and cons of each option:
5.Consider a budget
Once you’ve detailed all income and expenses, you’ll see exactly what you have left over for extra spending or saving at the end of the month. Prioritize how best to use this leftover budget, whether it’s a romantic meal together or an extra top-up for your savings. If you need help with budgeting, check out our blog post on budgeting.
6. Ask for help when you need it
If you and your spouse are unsure where to start with your finances, it could be a good idea to share your concerns with someone who knows. This might be an experienced friend, or even a financial advisor who can look into tax-efficient steps you could be taking together. It’s also important to update your will and other legal documents when you get married, to ensure that both your partner’s and your wishes are reflected. Then, review these documents every year or when there are any changes in circumstances, to see if updates are needed.
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Money and marriage can be a match made in heaven with a little trust, planning and good communication. But why not get some help from your bank along the way? Open a premium N26 bank account and access up to 10 sub-accounts with our N26 Spaces feature. Save for collective goals with Shared Spaces, and name each space according to your goals. Take some of the labor out of banking and set up automatic transfers with Rules — it’s a fuss-free way to easily put money aside each month.
Money management can be a challenging topic for anyone, and when two people are involved it’s bound to be extra complicated. However, fear not! With good communication and a little planning, it can become a positive common project that may even strengthen your bond. Remember that there’s no right or wrong when it comes to managing your money as a team. What’s more, things can always change, so it’s a good idea to plan regular meetings to make sure you’re both on the same page.
Though there are lots of options, most couples manage their money in three different ways— using separate accounts, a joint account, or a combination of the two. Separate accounts are a great way to avoid the work of setting up new accounts and to maintain autonomy, but can take more planning when it comes to collective bills. Pooling your money into one account is another option, but this can be challenging if spending habits differ. Some couples opt to compile collective expenses into one account and have another for your individual spending and saving.
How your costs should be divided up as a married couple is a very personal decision. This will depend on a variety of factors, which may include your jobs, salary, age, childcare or other non-paid labor, and more. Remember, there is no formula—the goal is to find a solution that works for your marriage, where everyone feels respected.
These days, there are tons of online resources for couples looking to manage their finances. With N26, for example, you can set up automatic transfers with Rules, receive instant push-notifications for every transaction, and get in-app spending categorization with Insights. If you’re looking for more help organizing your finances, check out our list of the top budgeting apps.
When it comes to budgeting, the 50/30/20 split is a great starting point. Here are the basics: set aside 50% for essentials, 30% for treats and leisure, and 20% for savings or an emergency fund. This is an excellent way to set common goals as a couple, and to make sure there’s enough money saved up for a rainy day.
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