Thursday, May 2, 2013

Financial Disclosure

Reader participation requested....


Just wondering how you and your significant other handle your finances. Is one responsible for paying all the bills and doling out allowances? Do both parties participate in the process? Do you both fully disclose your finances, your bills, etc. and decide how to spend every cent? Do you divvy up financial responsibilities and let everyone decide on their own how to handle any extra money? Other??????

A friend of mine divorced his first wife long ago, and money was one of their biggest issues. She shopped. A LOT. She tried to hide her bills and the tailspin of monumental debt that she created, but eventually the truth came out.

This friend of mine is now on marriage number two. He and his second wife have decided how to handle the bills. They have equitably distributed the bills between each other.  They both contribute enough to cover their portion of the bills, and any left over money is considered "fun money" to be spent or saved as each of them see fit.

This friend hoards extra money every chance he gets, as he wants a cushion in case things don't work out with the marriage, and in case any future financial issues arise. He suspects his wife does the same. I am guessing that many couples handle their finances this way, but I am not sure.

I would LOVE to hear how you handle financial matters with your significant other (or, if you are between relationships, how you think you would like to handle such things on the next relationship go 'round).

Feel free to comment anonymously if need be. :)

P.S.  Forgot to mention this earlier, but I am assuming the rules are different if you are NOT married/NOT living together, but feel free to inform me if you think otherwise!  


Cheryl Ann said...

Saul and i know pretty much everything about each other's finances/debt, in that i know what he makes and i know what his debt total is and he knows the same about me.
we work together to pay off our debt (CC's, etc.), since we're usually spending the money on something for both of us. if i use a CC to buy him a gift, i pay that off with my money and he does the same.
we both contribute equally to the bills, and then take care of other stuff on our own (i have a kohl's charge card and i pay his truck note, since it was a gift from me to him, etc.).
we both still have separate checking accounts, but have a shared savings, for vacation. we also have a shared retirement account that we both contribute to each month.
we're honest about our financial situations, even if it's embarrassing (i spend a lot of money on dumb shit sometimes). i can't imagine trying to lie about debt or money - it would stress me out too much and i'm pretty sure i would just lose my shit.
**there's your novel ;)

Stoic Tia said...

Since Richard and I met in college, we both came into the relationship with zero dollars to our name and the obvious student loans. When we moved in together, everything was spilt down the middle, with Richard always handeling the actual bill paying because I'm not the best at that shit. I think it was around the time when we bought our house that we got a joint account, with each of us keeping our own accounts. We would then transfer a set (equal) amount of money from our personal account to our joint account for paying bills. With the addition of kids and all the extra bills that comes with those, we started putting our entire paychecks into our joint account, and each taking an "allowance" each month.

Within that, we worked together to pay off each others student loans by working an extra amount into our budget to get them payed off quicker. And I agree with Cheryl Ann, trying to sneak and lie and hide money sounds way to hard! I suck at secrets. Plus I don't have any money to hide...

Jennifer Vallette said...

I shopped a lot and lied about it too in my first marriage. But then again I was 22 and married to a cheap miser. Now my husband and I both contribute to our bottom line but I do insist on an a regular allowance for my personal needs. Sometimes I get it- sometimes I dont depending on cashflow (he works freelance (feast or fathom) No lying or hoarding though. If we did break up we'd prolly just go our seperate ways, split the savings and arrange joint doggie custody. I know married people that keep their money seperate and split the bills down the middle even when one makes less than the other. Seems kinda lame but whatever! Not my circus - not my monkeys!

Anonymous said...

Since my husband is a lawyer and makes a crap ton more than I do, he pretty much pays all the bills. We both got married late in life and were both established in our careers and home ownership when we met, so it's not like we formed a life and an adulthood together.

I buy groceries, I pay for a cleaning lady, I pay for the kids clothes and my clothes...I pay for a lot of the extras and niceties. But I also have a crap ton of disposable income. He doesn't care what I spend out of my personal income just so long as I max out on my 401K and I don't have any debt, which I don't.

So it works for us.

Anonymous said...

Also, I forgot to mention, that we have separate bank accounts and separate credit card accounts and don't blend any of our accounts. C'est la vie. No fighting over money. Nobody seems to care what the other one is spending.

Anonymous said...

My husband and I maintain both separate and joint accounts, but all the money is completely shared. We are very open and communicative about our finances, with total transparency about what is being spent.

We have separate credit cards, but talk a lot about how much is owed on them and always mention that the bill is being paid and how much will be coming out of the bank. We also have each other set up as users on each other's credit accounts.

That being said, we also own a business together so it becomes a bit harder to hide money since we both see everything coming in and going out.

If we want to buy something, we just say "Hey, I'm going to buy this". But, that being said, neither of us really shops very much and most of the time a "splurge" is on something for the house or something like a trip or meal that we can both enjoy.

We talk a lot about our financial goals and so when we are expecting to be paid or get a paycheck, we usually have discussed in advance how we are going to spend it (sadly BILLS usually)!

Claire Kiefer said...

I'm glad you brought this up--it's interesting to hear what people have to say!

We are extremely transparent with money. We know exactly how much each other makes, what bills cost, etc. We theoretically split rent (though I pay more since Matt has so much child support to pay), I pay gas/electric, he pays our cell phone bills, etc. When we go out, I usually pay b/c I make more money, but mostly we treat all money as "our" money. I spend way more than Matt does, though. He's pretty minimal.

Ashton (King) Wright said...

It's all 50/50 with my husband and me for the most part. There are a couple of things we split 30/70 because he brings home a good bit more money than I do. Also, we each have individual bills for things we accumulated before we got married. We still have separate bank accounts (for now) so it's a little easier for each of us to keep up with our own finances. However, it's no secret of how much either one of us has. If we want to do something or need something and I've got extra money, I buy it. If he has the money, he buys it.

Kana said...

Well, me and my somebody aren't married, and there's no kiddies, so the finances are perhaps more simple than if that werent' the case - but we've been together for almost 6 years, so the formula has been proven over some time!

We make similar amounts of money (I make a little more right now) so we each pay for our half of things like rent & utilities.

We take turns buying the groceries & gas (1 car household, yyyeeaaahhh!)and I spring for the fast food, while he treats on sit-down dinner-dates. He used to pay for ALL food, groceries AND eating out; but once my pay matched and then exceeded his, I wanted to be more of an equal partner. :)

Our respective leftover discretionary money is our own, each springing for our particular treats & toys; but we're planning on travelling together this summer, so it'll technically be allocated to the same place this time!

Lorena said...

I'm the CFO when it comes to $.
My h is a big spender, he has no control and i am a bit more organized. So we kind of run things by each other if the sum is considerable.
He pays for all the "big things": main mortgage on the apartment and 50/50 on other properties. Also water, electricity and phone bill.
I pay for repairs, maintenance fee, groceries
Each one of us pays for his/her own car, gasoline, insurance and cel phone bills.
We only have one credit card for both of us - we try to pay it in max 3 months.
We save any extra money in a joint account and use it on vacations, home improvement, taxes...
It works well - plus we both have our own accounts that we pretend we dont know about.

kathy @ vodka and soda said...

i'm married and we dump our money into one account from which most of the house bills are paid. i also own my own business so bills that are related to my business (internet, cell phone, car payments etc) come out of my business account.

for some reason, it ended up with me being the bookkeeper so i pay all the bills and manage the money. no allowances are doled out and we don't consult each other with our purchases unless it's big (ie. over $300). the only time i ask hubs about purchases are when the credit card statement comes in and i ask him if those purchases are legit (we've had our credit cards compromised before).

it works for us. my parents had one account as does his so i guess we both grew up in an environment where money is pooled and used.


I haven't lived with my boyfriend yet, but it's due to the fact that I'm not totally financially dependent on my own just yet so I can't actually take up more risks at this point. I just hate it when money is in the picture. Oh well, life....


Lara said...

D and I have now lived together for 4 years and we have always split everything down the middle. We just recently talked about what we make with one another since we've both got new jobs. Also, the only bill he pays exclusively is the cable/internet since we bought an expensive sofa and I'm making the payments on it. As soon as that's paid off, I'll go back to paying 1/2 of the cable. All of our utilities are included in rent but we would share the password and pay 1/2 and 1/2 online for sure.
We don't have joint accounts and I love it. We can both do whatever we please after the rent is paid.
One issue I have is saving together for a mutual goal. We just had a convo about that actually and agreed to start putting aside a set amount of money every two weeks for buying a house/having a kid one day.

I also do all of the grocery shopping and he gives me 1/2 in cash or will get all the takeout for a while.

As far as squirreling away money for a bad situation... everyone should. No shame in protecting yourself. It doesn't mean you think the person with eventually suck at life. One of you could lose your job (D was unemployed for a looong time but still paid his half with unemployment), or you could have a medical/car emergency. Anything could happen. It's just being smart.

My biggest fear is getting preggo and wanting to stay home with baby for a while and having to ask for money and justifying buying a goddamn pair shoes. Cold day in hell my friend.

Elle Sees said...

just me, so just my finances. charlie needs to contribute to the rent, hehe.

Trissta said...

Again, this is part of the reason why I'm not in a relationship. IDK how I'd handle all of it. I would say that you can only spend the money that you make, but you contribute into what you use/live in. IDK it's all so fuzzy and boundary-less.

Much Love,

Megan said...

Before my husband and I were married, I didn't want any of his money. We kept our finances separate for as long as possible because I was an independent woman and I wasn't in love with him for his bank account. Finally, I broke down one day and gave in to a joint bank account because we were applying for my UK visa and that was a requirement to prove to the British government we had a valid relationship.

We didn't have our first issue with money until we moved to England. There is something called an overdraft that UK banks issue to checking accounts (but over there they are called current accounts). I saw that we had a certain amount in overdraft which I mistook for our actual account balance so I thought that we had more money to spend than we actually did. Later, my husband looked at the account and was like WTF happened to our money? I like to know how much we have down to the penny and I balance our accounts every day. He likes to check in every so often and keep a mental tally for spending. So, after he explained to me what the overdraft was, I took over our marriage finances from that point on and we haven't had an issue since.

I keep a detailed Excel spreadsheet with an annual projection for all household expenses and savings. I had to do this for both the US and UK accounts for a while since we were being paid and maintaining households in both countries. I know how much money we have in our accounts at all times. I budget for every expenditure. I really enjoy the accounting aspect of managing our finances and I love Excel. I am bad at math so I find excel helpful. My husband is a mathematical genius and doesn't need excel because he can do figures in his head.

Because I am the one who manages the finances and I know where all of the money is being spent, I can tell you it has good and bad points. Good is that I know exactly where all of our money goes and how it is being spent. Bad is that if my husband buys me flowers for Mother's Day, I get an email from the credit card company telling me that a purchase was made and for how much. So, now I am going to have to act surprised on Sunday. ;-)

Alisa said...

As soon as we got married we closed personal accounts and opened one checking/savings. We have taken turns paying the bills from the one account.

We consult each other on any major purchases. It hasn't ever been an issue.

I often think, "Man if I wasn't married I would buy that right now!" I thought that the other day about a pair of shoes. It make you really think, "Do I really need this?" Because we are trying not to spend so much, it makes me more careful about purchases. Which is good.

Alisa said...

My sister has lived with her boyfriend since the late 80s. They have separate accounts and split the bills. Seems to work for them.

Kathryn said...

Both times I have lived with someone (once married, once engaged) both men were irresponsible with money and I ended up having to take control of the finances to keep their stuff from getting repossessed.

While they were thankful to be able to keep their stuff, they resented turning their money over to me to pay their bills.