AIBU to think that this financial arrangement make sense or is way too complex?!

(66 Posts)
ComposHat Mon 29-Jul-13 18:03:13

Right here goes....

Just got married and both DW have roughly similar incomes (I am doing a PhD and have bursary, she works full time)

Until we got married, we had totally separate bank accounts (for a variety of reasons, but mostly because we have very different attitudes to money and spending habits. One saver and one spender)

Both of us world feel resentful of the other if the finances were totally shared, they'd be mutual accusations of 'running through the money and having nothing left to buy milk' or 'being deprived because the other is a tight bastard.' Neither of our approaches to money is right or wrong, just different and not reconcilable. We'd both feel our independence was being compromised and for us, everything in a joint account, isn't really an option.

Equally it is becoming a faff with joint expenses,such as the weekly shop. rent and utility bills, as we have to keep constant track of who owes who what.

So this is what I've come up with.

Our wages/bursaries continue into our personal bank accounts.

We each pay the same amount into a joint account for food, bills, rent/mortgage, council tax etc. (say £450 each) at the start of the month.

Whatever is left at the end of each month in the joint account is then transferred into a joint savings account.

That way we have three lots of money

1) Our personal accounts (our own to do with as we like)
2) The joint current account (for day to day purchases)
3) The joint savings account for expensive long term purchases such as furniture or as a 'rainy day fund'

Does this seem a bit convoluted and over elaborate? DW seems to think it will be harder to keep track of what money was where and making sure there was enough in each account.

Any thoughts or alternatives would be gratefully received!

jkklpu Mon 29-Jul-13 18:06:25

It does sound a bit complicated, tbh.
Why not each transfer the same amount to a current account and a different amount each to a savings account? That way, you'll know you're saving something and it won't depend on having anything left at the end of the month.

DontmindifIdo Mon 29-Jul-13 18:11:28

that's how we do it, make sure the joint account is enough to cover the bills, I'd say for the first few months, don't transfer out the excess, keep it in there to build up a float incase there's a big bill and you won't have to worry in the same way that there's enough in there to cover the bills.

Each of you will only really have 2 accounts to keep track of, you your personal 'fun money' (which you can spend as you like without worrying the other one is over spending/what the other one thinks of your spending) and the joint account which is for sensible things. We have a rule we don't pull cash out of the joint account, so we can always track any purchases from it.

I don't see that you'd regularly need to check the savings account, surely you'll just dump money in there and not touch it/look at it unless it's for something big like a holiday?

ThingummyBob Mon 29-Jul-13 18:12:32

Neither convoluted or over complicated imho.

Seems like a perfectly sensible way to deal with the two different attitudes to spending.

eurochick Mon 29-Jul-13 18:13:02

Sounds fine to me and we do similar.

We worked out roughly what our monthly expenses were and added a bit as a cushion. We then divided that roughly in proportion to our salaries. We pay that amount into the joint account each month, by standing order. Everything else is in our own accounts and ours to do with as we wish, although realistically, we would discuss any really big financial decisions.

We haven't bothered with a joint savings account as interest rates are so low it doens't seem worth the bother of moving the money, but we leave the extra in the joint account and use it to pay for things like pieces of furniture, one off house maintenance and if there is enough, holidays.

ComposHat Mon 29-Jul-13 18:13:36

jkklpu I take the point, but we don't know how much we will be able to save at the start of the month (if anything at all)

We are not on the breadline, by any stretch, but say a bigger than expected gas bill that month, it wouldn't leave us much money to play with.

StrangeGlue Mon 29-Jul-13 18:16:29

I think it sounds sensible. Is she worried about the savings account eating into the amounts you have in your private accounts?

If so it should be easy to work out more precisely what your joint compulsory expenditure is and then set a negotiated lump for savings. For example: rent is £200 each, food is £150, water is £10 elec and gas is £40 tv license is £6...

You just need to decide whether eating out is budgeted or personal expenditure etc.

If one of you is a real spender savings is a good idea else you'll never get a holiday/sofa etc

trinity0097 Mon 29-Jul-13 18:16:48

That's kind of what we do, wages into personal accounts, money transferred to joint account for household expenses. Also wise to pay one twelfth of annual (or less frequent) costs into a savings account, e.g. £30 a month away for car servicing, £20 for Xmas, £5 for house insurance, £100 to replace cars etc... Keep it all in one account, but track what is in each pot via a spreadsheet or similar.

RatUpADrainpipe Mon 29-Jul-13 18:16:49

No, it doesn't sound convoluted to me - it sounds like a sensible solution to your dilemma.

However, I would leave the leftovers in the payment account for about 6 months, then transfer it to the savings account. That way, if an unexpectedly high bill comes in, you can pay it without hassle.

Doesn't sound too complicated at all. Great idea.

chocoshopoholic Mon 29-Jul-13 18:22:46

This is exactly what we do. Top tip of where we fell down was forgetting to factor in annual expenses into the monthly transfer (car mot, tax and insurance!). Now we add in all the expenses, and how much we would like to have ready to spend on a holiday into what we're transferring in so there are no surprises.

We do the same but the joint account always has a buffer in there in case an unexpected expense comes up. We also tend to slush any extra left in our personal accounts into savings at the end of the month. Obviously if one of you is a saver then you may want to keep the leftover money separate.

hermioneweasley Mon 29-Jul-13 18:25:14

Sounds sensible to me too

CMOTDibbler Mon 29-Jul-13 18:25:40

We've done that for 16 years now, though we leave money in the joint account as a buffer.
Works great for us, and we never argue about money

Trills Mon 29-Jul-13 18:25:52

1) Our personal accounts (our own to do with as we like)
2) The joint current account (for day to day purchases)
3) The joint savings account for expensive long term purchases such as furniture or as a 'rainy day fund'

That sounds perfectly sensible, as long as it is arranged so that:
# both #1s get the same amount of money
# you both agree what #2 and #3 are for, and how much goes into them

We find it pretty easy to figure out how much #2 needs (rent/water/internet/gas/electricity don't change unexpectedly, and we estimated an amount for supermarket shopping).

HazleNutt Mon 29-Jul-13 18:29:34

sensible, but you also need to discuss what will happen if you are no longer earning similar amounts, or if one does not have any income for a period of time.

ArtemisKelda Mon 29-Jul-13 18:34:12

Compos this is exactly what DH and I do and it worked really well when we earned around the same. Now I earn less, I put less into the bills / groceries accounts and he puts a bit more in. It means that I can buy what I want with my money, he can do the same with his.

ComposHat Mon 29-Jul-13 18:34:43

Thanks everyone, good to hear that the consensus is that we aren't making things more complex. I think the 'buffer period' before transferring it over is sensible.

I think three months would be sensible as a buffer, someone said up thread, it would never be saved and would be all gone. The car tax/insurance/repairs which are the 'big sum' payments will keep coming out of my account as DW can't drive.

We agreed to work it so we both had exactly the same spending money each, the the rest into joint.

Over time, perhaps you may just need to tweak the detail - eg if one of you becomes a SAHP or goes part time for example.

But having the principle established from an early on makes life way way easier!

ComposHat Mon 29-Jul-13 18:37:39

sensible, but you also need to discuss what will happen if you are no longer earning similar amounts, or if one does not have any income for a period of time

Yes, that is a bridge to cross, my funding runs out in a few years time and the writing up period doesn't have funding. I have some savings, so will be able to use them for my 'share' of the groceries etc. Not sure if much would be going in the saving account for about 8 or 9 months.

Tigresswoods Mon 29-Jul-13 18:37:42

Sounds exactly what we do. It's worked for 10 years. Just need to regularly review how much goes in to the jt account to make sure there enough in there.

ComposHat Mon 29-Jul-13 18:46:20

Am I right in thinking that, you can get the bank to clear the remaining balance at the end of the month into a separate account automatically?

whois Mon 29-Jul-13 18:54:05

Not complicated at all and is a very sensible approach. Should work really well while you earn similar amounts.

This is exactly what DH and I used to do pre-DC and we had similar salaries.

jojane Mon 29-Jul-13 19:03:51

I would see the car as a joint expense as both of you will be getting the benefit ie going shopping, trips away etc

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