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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!

ComposHat Mon 29-Jul-13 19:07:51

Yes, jo DW is yet to see the merits of this!

To be fair I mostly use it for getting to and from University (and for research trips) and most of the amenities such as supermarkets etc are walking distance. If we are going on a trip, she might cough up for some petrol.

RobotBananas Mon 29-Jul-13 19:08:42

Looks fine to me!

I'd go further and have 2 joint accounts though. One for bills, mortgage etc - the things that don't change each month... Then another one for food shopping and other day to day expenses. That way, if the food account is running a bit low you're not going to spend money earmarked for the mortgage.

Works for us

formicadinosaur Mon 29-Jul-13 20:02:13

When you have kids you may want to look at paying everything into a joint account and leaving yourself with the same amount if money in your personal account. 200 a month or what ever.

SmiteYouWithThunderbolts Mon 29-Jul-13 20:04:44

That's exactly what we do at the moment. DH has his wages, I get tax credits and child benefit. We each pay a proportionate amount of the household bills into a third account out of which the direct debits are paid. Whatever is left over we spend as we see fit and at the end of the month, if anything is left (ha!) it goes into savings.

Makes perfect sense to us!

Mouthfulofquiz Mon 29-Jul-13 20:05:35

We do that and it works great!
Same amount of spending money each, same amount into the joint account for bills and the rest of hubby's wages go into savings.

DontmindifIdo Mon 29-Jul-13 20:19:48

We've always kept cars out of the joint account bills, but then we had one each, but I'd suggest if you are hte only one to use it, you can only call your car costs 'joint' bills if your DW's rail/bus costs also come out of the joint money.

I'm currently on mat leave, DH has taken over paying my share into the joint account and when my SMP runs out, he'll be also transfering money to my personal account so we have roughly the same 'fun' money each month.

IMO keeping an account just for bills and food and the your own accounts for personal, fun spending, means you have a much tighter control on your actual costs of running the house/family, people who do it this way are far less likely to get to the end of the month not knowing where all the money went. At the end of the month, you might have overspent earlier in the month so run out of 'fun' money each, but you can do the supermarket shop still and not worry about it.

Blondeshavemorefun Mon 29-Jul-13 20:20:41

exactly what we do apart from transferring into savings account - tbh interest is so crap its not really worth it moving pounds over

what we also do is when joint account is a bit healthly then buy £100 prem bonds, so still kinda saving but also could win a million and can cash in if car blew up and needed money asap

pianodoodle Mon 29-Jul-13 20:36:49

That sounds sensible for your circumstances.

We chuck everything in one joint account here but we pretty much have to just to cover essentials! Would be nice to have an extra account for savings - maybe some day smile

MsVestibule Mon 29-Jul-13 20:49:16

This sort of arrangement works well when you're both earning similar money, and doesn't sound convoluted at all. However, if one starts to earn more money than the other, e.g. one of you goes PT to look after children (sorry, not making any assumptions!) and/or the other starts to earn more due to a promotion/new job, than it's unworkable IMO.

We've always worked it that all income goes into a joint account, and we each have an equal monthly SO from that to our sole accounts. That way, we always have the same amount of 'frittering away' money, regardless of who earns more. Of course, some people believe that if they earn more (for whatever reason), they're entitled to spend more, but that's for another thread!

marriedinwhiteisback Mon 29-Jul-13 20:59:16

I don't know. when we got married I earned more than dh and he agreed to pay half of all outgoings. When I gave up work when ds came along dh was still earning less than me but we had enough and I laid out and gave him a bill with the receipts at the end of the month. He took over all the bills and I billed him for food shopping, petrol, general spends (I am naturally careful and had a little bit of my own money).

I went back to work when the youngest was 5. I earnt a minute fraction of what I used to - still do. Now I pay for extras for the children, kitchen stuff, linen, and my clothes - oh and I pay to run my car.

We have never had a joint account. I earn one tenth of what dh earns and he probably doesn't spend more than me on personal stuff.

I don't think it has anything to do with earnings; I think it has everything to do with attitude to money and it works for us because neither of us is extravagant.

saintava Mon 29-Jul-13 21:18:13

We did a similar thing when we both worked before DC, worked out the costs of the house and car etc and then put an equal amount into a joint account. Now that I stay at home with the DC, DH pays the full amount into the joint account as it saved changing all the direct debits over and I buy the food with CTC etc. It worked well for us.

Any extra in the joint account was just left in there to build up in case of washing machine breaking down etc, and although our council tax is paid over 10 months, we pay the same amount in every month of the year as it gives us a little extra if we need it, like when DD1 broke the washing machine last year (I have no idea how).

A few years ago we used the extra we'd built up to pay both car insurances in one go rather than monthly instalments and we saved paying interest on the insurance, we just divide the amount into 12 monthly amounts and increased the payments into the joint account. Saves us a couple of hundred pounds a year.

adagio Mon 29-Jul-13 21:35:02

Here is what we do:

Budget the joint account for all DD's and a set sum for car insurance, tax, tyres etc; home insurance. Standing order for the savings into joint savings account each month. This is not real savings per se, this is money we expect to spend each year for the big ticket items.

When we earned the same, we paid same into joint account. When we earned different, we paid proportionally into joint account, and now I am on Mat leave I don't pay anything in, the DH covers the lot.

We then put the variable costs - so food, supermarkets etc all on one credit card which we pay half each of each month - always paid off in full, on a cash back card. Again can vary the proportion each pay dependent on earnings, and this credit card is ring fenced for 'joint' only stuff. Currently using the mat pay to cover this.

We also each have our own credit cards should we want/need them. We each have our own personal accounts and savings accounts, which we can do what the heck we like with - but worst case we know the bills are covered from the joint so we would never be homeless, and no one gets the hump if the other blow a ton on a good night out (well, thats obviously not me anymore since DD arrived but you get the idea!). It also means presents are genuinely a surprise and cost is genuinely unknown - I like that element particularly for e.g. my 21st and 30th where I am sure he pushed the boat out, but I will never know the details :-)

adagio Mon 29-Jul-13 21:36:31

basically, what saintava said then!

Somethingtothinkabout Mon 29-Jul-13 22:07:44

We do this too. We worked out (well, I did, with a trusty spreadsheet) what we need to cover mortgage, council tax, gas/electric/sky/tv/phone/internet/all insurance. It came to £1300, so we put £1350 in the joint account. We both put in a proportion of our salaries to cover that meant we both have the exact same amount left in "fun money".

This way we were both able to budget ourselves, and anything left from our fun money we save in our own accounts, anything left in the joint account runs over as a buffer the next month, and hopefully as a contribution to holidays.

Sometimes if we are making a big joint purchase we split the cost 3 ways, we each pay a third and the joint account pays a third, makes us feel like we're getting a bit free!

saintava Mon 29-Jul-13 22:56:27

adagio great minds and all that! smile

Most of friends seem to have different ways of handling their finances, I think it's interesting how as a group we all do things differently but are all happy. Really shows I guess how there is no right or wrong way, just what works for each couple

WafflyVersatile Mon 29-Jul-13 23:05:28

Sounds fine to me, but savings are best put aside at the beginning of the month. If you leave them to the end there is nothing left, especially if one of you is a spender.

Be clear on what comes from the joint account and what doesn't but accept that if someone buys a paperback from the supermarket when doing the weekly shop it is no big deal.

WhereYouLeftIt Mon 29-Jul-13 23:07:22

We do it slightly differently. All income goes into a joint account, because we consider all money to be jointly owned. But, money is transferred by standing order from the joint account to our two personal accounts, we each get the same amount of 'pocket money', and it's ours to do with as we wish; save it, spend it, fritter it away, whatever we want. If a surplus builds up in the joint account, it is transferred to a joint savings account, but this doesn't happen every month.

I have in the past done it the way you are planning to do it, and although it was OK in the short term, in the long term you have to keep revisiting the arrangement/amounts whenever there's a big shift in joint expenses or a change in one person's income. The way we do it now, what changes is how much 'pocket money' we take. Over the years it has gone up and down, but always equal and always with the joint expenses taking priority.

ComposHat Mon 29-Jul-13 23:44:35

okay I can see the logic of the all in a joint account amd then pocket money each. However I'd feel awkward about asking DW to support me whilst finishing up the PhD. I doubt the suggestion would sit well with her either. I think we are so used to thinking 'my money & his/her money' rather than 'our money' that it wouldn't work.

travailtotravel Tue 30-Jul-13 08:24:31

I understand how you both think now ComposHat but really recommend you start talking about it and thinking about it now - perhaps with the advise of this thread.

What if you DW lost her job for any reason (god forbid)? What will you do when writing up?

Best you don't argue face these questions at the time.

ConfusedPixie Tue 30-Jul-13 08:36:19

Dp and I do what is written in your op. But I tend to put a lot more in earn more and have more to spend, so our savings is essentially made up of my earnings. I have no savings of my own whereas does to cover the shortfall when he vs earning less (exam time and early summer).

Tbh it has ended up that any income is joint income in our minds, we just happen to keep some in our own accounts because it's easier to keep track of our individual spending and personal budgeting that way instead of puzzling which transaction was mine or his and what it was on.

212VIP Tue 30-Jul-13 08:39:36

That's exactly what we do. Not convoluted. Very straightforward.
Although there's never anything to transfer into the savings ime... ;)

sparechange Tue 30-Jul-13 09:05:06

Sounds sensible, except, would the spender have any money left to put in the savings account?
Because if after a year, it is all from the saver, and then the spender suggests buying something, would they have an equal say?

How about on payday
Set amount goes into the 'household' account, set amount goes into the 'savings' account and what ever is left over, you keep

(also, can you do it as a % of take home pay, to make it fair if one of you gets a payrise or cut?)

Didactylos Tue 30-Jul-13 09:14:37

it sounds pretty sensible
look at how many threads on here are about unequal financial arrangements between partners:

We do something similar for a joint/household account except a sort of proportional sum as theres a bit of a difference between our incomes and it would be unfair if we paid the exact same amount. Set proportion for each of us goes into a savings account too. Personal debts/cards etc are paid off from our individual accounts, clothes, presents etc. So we can both prioritise from our own income without feeling we have to justify ourselves to the other. If theres an issue (mistake on wages, cashflow issue, big purchase, between jobs) we usually have enough in the joint account to cover or the unaffected one will step in with money from a personal account to cover a cashflow crisis

KatyN Tue 30-Jul-13 09:18:23

we do this too.. except we each get the same amount of spending money rather than paying the same amount into the joint fund. that way if one of you starts earning more (or maternity leave - am I thinking too far in advance) it's fairer.

We only have one account though and manage our spending money through a spreadsheet. I felt really unconfortable about having a bank account that my DH couldn't access.


UC Tue 30-Jul-13 09:29:08

DP and I have almost exactly that set up. For similar-ish reasons. It works.

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