Handling joint finances?

I mentioned in my previous post how I have had some personal issues with my relationship recently. As a result of this, we separated all of our finances. Now that we are coming out of our troubles and merging as a couple again, I am not sure what to do about our finances.

I have several questions - how do people who keep separate finances save/pay bills together? I understand having multiple checking/saving accounts and such - we already do that. But what about the nitty-gritty - paying the bills and saving?

Friends have recommended we have separate AND joint, where we each contribute a certain percentage (basically divided up by the percentage that we bring to the household) to the bills and savings. Debt Hater and Make Love Not Debt (among others) seem to have a good system down, but I haven't seen the minute details (or maybe I haven't been reading long enough), which is where I am having the problem.

What do we do when our goals are different? I want to save a lot, my gf wants to save a little (although this is slowly changing).

I can save in my account separately, but what do I do when I have a bunch of money and can afford a trip and she can't, especially when we never go anywhere together? Am I supposed to save for the both of us when she spends her money on going out and presents and such (for the both of us, to be fair)? Or vice versa, what do I do when she saves her money (she makes way more than me) and I've saved all my money to pay down debt and build up the EF and at the end or whenever, I'm debt free and she has a bunch of money saved up and can go on a trip or something?

Do we make couple AND personal goals? Something in the vein of "Honey, I want to do X and Y (save $2000 and pay off 100% of debt, for example)" and "Dear, I want to go to Hawaii (or whatever)". Does it become something like "Well, let's compromise and save $1000 and pay off 50% of debt AND take a short trip to NYC and stay with friends"? That seems like the most logical thing, in my mind. I have never approached it this way before.

Hmmm, seems like we are going to have to figure out what our personal goals are first and THEN work together towards a compromise that suits us both.

Do other couples handle it this way? How do you handle this?



Debt Hater said...

Ah, this does sound tricky.
The key is to explain up front and with plenty of notice what you'd like to do. So if you know you want to take a Hawaiian trip, figure out how much it will cost you both and start saving it together. That's just an example.
My guy and I were doing fine up to now because all our accounts and finances were separate. I told him how much the bills were (only the things we shared: rent, utilities, groceries, etc.) and he gave me half in cash or a check. I paid all the bills out of my own checking account. I am paying down my debt on my own, including car payments and car insurance. He pay his own bills on his own.
Now when it comes to joint goals, that's tougher.
We both have been saving for the wedding, but he gives me his half in cash or check and I deposit it in hi-yield savings account open only in my name.
In the future, we plan to have a joint checking account for bill paying, but seperate savings accounts. We'll likely pay 50-50 regardless of who makes what (only because he didn't seem to keen on the pay a percentage idea, which I think makes more sense).
Aside from that, I'd like to open a joint emergency fund once we're married and moved in together.
Hmm... reading this makes me realize we need to talk about a lot more things!

Clink said...

Your comment reinforces my thoughts that all this couples finances ish is hard - what's sep and what's joint? I agree that couples need sep and joint (I have no idea how people do only joint!), but it's in the details that problems could develop.

Check my next post for a small update.