Money & Couples Series: How We Merged Finances When We Got Married, Part 1
Accounts and Spending Tracking
My husband and I have now been married for over a year. In that time, we have really honed our personal finance monitoring and budgeting process together. It’s been a journey, and we absolutely love where we are at now. Let me tell you how we got here. :)
The bouquet, just for fun.
Before Marriage
We had both been intensive spend trackers from early on. He used an app to record each of his transactions in real-time, and I developed and faithfully used my own custom spreadsheet (now available here!) to continuously reconcile my bank balance and compare my spending to my income every 2-3 days or so (also each transaction). We used Splitwise to split shared expenses 50/50 regardless of who paid for it, and we would reconcile with each other via Venmo once every month or so. (It’s just chips and salsa, right?!)
So when we got married, it came naturally to us to find a way to combine our tracking systems together. I will note though that we continued to use our system above for our entire engagement - only once we were married did we combine and switch to the below system. Wedding planning was stressful enough without trying to merge finances too!
Account Setup After Marriage
We combined our separate checking accounts into one joint checking account for day-to-day use. All of our income (both his and my paychecks) comes in there first. We kept all of our other old pre-marriage accounts to keep most of our pre-marriage money separate from our during-marriage money (here’s why). We also opened both a new joint savings account through Ally (separate, high-interest) and a new joint brokerage account at Vanguard to hold money for our many joint goals together (like travel, emergency fund, house, etc). We kept our existing credit cards in our own individual names.
Why I Love our Post-Marriage Account Setup
This setup reflects our philosophy that all money coming in, whether it’s his paycheck or my paycheck, furthers our joint goals and belongs to both of us. It also happens that this setup reflects the defaults in the state of California in case of divorce (all during-marriage is “community property” and would be split 50/50; pre-marriage money is kept separate until we decide to commingle it with during-marriage money if we like).
Simplicity, simplicity, simplicity. All of our income comes into one place and is allocated and budgeted from there. Our new joint checking account is the central hub for subsequently sending money to work for us in the other various accounts we have.
Our setup allows for birthday present surprises (I just put it on my card, so he can’t see the transaction description!). Being able to each see the gift amount keeps us on the same page with gift spending levels. Besides, the real surprise is in the gift itself!
No more Splitwise! #married #householdincome
Note that you and your partner might value different things completely! And that’s totally ok. I’m sharing this with you as an example of what works for us and what we value. I should also say that #1 above was really important to each of us to “feel married”. That’s not always true for everyone, but it was definitely the case for us so that was a big factor in determining our ideal marriage financial setup.
All money coming in, whether it’s his paycheck or my paycheck, furthers our joint goals and belongs to both of us.
How We Track Our Finances Now
In a word: YNAB! Also called You Need A Budget, YNAB has worked out fantastically for the two of us. We both felt very strongly about a few things going into this.
We were both very into monitoring finances above (wanted to know where every dollar was going)
We wanted to save as much as we could from each paycheck automatically
Both credit cards, savings account, and checking account are here
We wanted to have solid aggregate reporting (e.g. spending vs income over time, spending by category pie charts, etc)
He wanted to be able to add each transaction in real-time (ish) so he wouldn’t forget later
I wanted to make sure to reconcile the checking account balance in detail
An example of YNAB desktop view.
Why We Love Using YNAB
Every time we receive income (generally every two weeks), we allocate the income for specific jobs within YNAB
We manually add each transaction to our accounts (although we could link them automatically if we wanted) to encourage visibility and mindfulness of our spending
We can track progress toward our savings goals
YNAB’s website and mobile app work well together - he can update each spending transaction in real-time and I can go in to the website version every few days to update mine
It tracks actual bank balance with the “working” bank balance - even when a transaction hasn’t posted or cleared yet, I can still see what my bank balance *will* be after it posts
We can pay ourselves first (see here why that’s important) by allocating our first dollars we designate to our savings goals and then allocate the rest to our spending categories
We customized our categories and subcategories to fit our spending. I even have my own “Asha and Chai” category! :)
What We Also Do, But Don’t Use YNAB For
We don’t have our accounts linked. We prefer doing everything manually (that’s just us though!)
Net worth tracking. We found connecting investment accounts tricky because the “transactions” in those accounts are things like dividend reinvestments that don’t affect our daily spending.
Hopefully our example encourages you to find a system that works for both you and your partner - it’s not trivial and definitely took us a few months to arrive at a sustainable system that worked for both of us. But we continued to experiment, adjust, and optimize -- and now we love it!
Need help making your personal financial system work for you? Reach out here for a free 15-minute intro chat with Sarah today!
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