Long Relationships

Janet, one of my bloggy friends, is a recent newlywed and several of her posts of late have been about how she and her husband are working to combine their finances. She was gracious enough to let me interview her virtually about how the process has been going for today’s column.

Q. How did you feel about combining finances with your husband? Whose advice, if any, did you solicit?
A. When my husband and I first moved in together (as boyfriend and girlfriend), we kept a running tab of who paid for what and tried to keep things pretty even. After about a year, this system started to fall apart because we got lazy about tracking things. By the time we got married, we both had a good idea of each other’s spending habits, and we felt ready to merge everything together.

Although we were pretty sure we wanted to combine everything, I still sought out advice. I regularly read Washington Post columnist Michelle Singletary, who preaches about the importance of financial fidelity. I read personal finance books just for couples. I chatted with fellow brides on a message board I’m active on. I asked several newlywed friends how they handled money in their marriage.

One thing I learned is that a lot of perfectly functional married couples like to keep separate accounts. Sometimes people want to feel like they still have some independence over their hard-earned money. Sometimes people want to keep their expensive shoe-buying habits a secret from their spouse. Sometimes people want to be able to buy their spouse a gift without them seeing it on the credit card bill.

Q. What were the greatest motivating factors for combining finances?
A. We wanted to build a strong foundation for our marriage. Coming together about a financial plan isn’t exactly romantic, but we want money to work FOR is instead of AGAINST us in our relationship. The last thing we want to fight about is money. We decided to set goals based on shared values, and then work as a team to meet those goals.

Q. How do you and your husband’s financial tendencies align or differ?
A. Of course he would say that I like to shop too much. And I would say he likes to spend money on stupid things like Diet Coke. (Seriously, I do not want to know how much money we spend a year on brown chemically stuff that you pee out 30 minutes after you drink it.)

We both spend money on things that the other would not. But sometimes we just have to let the little things go—as long as we are 100% on the same page about the big things. I do not need to lose sleep over the fact that we could have saved $2.99 at the grocery store if we had done a better job at reusing Ziploc bags. (And yes, that is something I would lose sleep over. And then go out the next day and buy a pair of $40 shoes without thinking.

Q. How have you had to compromise?
A. We sat down to create our big picture financial goals. Luckily, there wasn’t too much compromise here. In the next five years we want to:

1. Buy a house that we enjoy living in but that does not make us house-poor.
2. Buy a new (used) car when the current car dies.
3. Have children and possibly go down to one income.
4. Be able to take vacations and enjoy life without worrying about every last penny.
5. Take on no debt (other than a mortgage).
6. Contribute the max to our ROTH IRAs (and hopefully more) for retirement.

Q. As you’ve worked on streamlining, what has been a surprise to you about you or your husband?
A. Although I knew my husband was going to have to look for a new job, I didn’t think we’d spend the first six months of marriage living on one (non-profit) income! Luckily, between unemployment and some contract work, we are still making progress on our goals, albeit a little more slowly. I hope that when we go back to DINK status, we can stash away a lot more in savings since we seem to be doing just fine without a second salary right now.

Q. What has been the greatest challenge so far?
A. The first challenge is outside of our control: it’s a giant pain to deal with changing your name, closing accounts, transferring money, switching direct deposits, etc. I will be so happy when we have one of everything and don’t have to worry about if this account has enough to cover the automatic payments attached to it and if I close that account which other things do I have to switch over, etc. I just want one stream of money in and money out.

The second is just making finances a priority. We feel pretty good about things, which means we get set in our little comfort zone and don’t actively work on moving forward enough. It falls to the bottom of the list.

Q. What advice would you offer to couples who haven’t yet talked about money?
A. If you are serious about making a lifetime commitment to a person (or perhaps you already have), then it’s SO SO SO SO SO SO important to talk about finances. How can you talk about all the things you want in life (house, kids, vacation, security, education etc.) without talking about money?

There are lots of resources to help you get started (personal finance blogs, books, columnists, Oprah, whatever floats your boat). You can start with the links above.

- - -

couples, finance, compromise, financial planning

For more, subscribe to LR.com’s feed