Can I ask about your financial arrangements?

[Writerwannabe83]

I hope this isn't of a too personal nature but I'm just curious as to those who live with their partner/husband manage their finances?

When I moved in with my partner a few years ago we agreed I would give him £500 a month to cover half of all the expenses a month and that was fine. We are now married and the arrangement hasn't really changed but now it just sits 'weird' with me. I have spoke to him a few times about it and that surely most married couples have a complete joint account and all finances are shared. He is happy with the idea of having a joint account but says we should sit down, work out the running cost of the house each month and only put that amount of money in the account, 50/50. He said that way, the rest of our salary is ours to spend how we like without feeling like we have to justify our expenditures to each other etc. I am now recently pregnant and so again have discussed having one joint account with all our money in it but he doesn't seem to see why it should be necessary. His parents are not too impressed with his attitude.

To be honest, I'm happy with the joint account for all 'house stuff' and we have the rest of our money to ourselves, but I'm just curious as to what others do?

When I say that most married couples have complete joint sharing of the finances my husband tells me they don't. None of us have anything solid to base this on though, we just both want to be right

OP

I think you might be in for a shock at how much having a kid costs. With paying for childcare (unless you have parents around to help) on your salaries I really don't think there's going to be an awful lot of spare cash floating around. Don't want to scare you, but just to highlight how important this is. There have been people on this board who have ended up getting into debt because their partner doesn't help out or gives them a miserable 'allowance' (what a horrible word). Please don't be one of them.

I am a sahm (3dc's)

we have many accounts main on is joint all bills come out of this (some in his name some in mine as it helps with id stuff). These are all paid by dd.

we have a second joint account which ctc/ cb goes into to build up to pay larger bills car tax etc.

we have 2 personal accounts which a small amount of personanl spending money is transfered too ( £50 pm) this is our no quibble money for clothes / books / presents etc (Yes it is tiny but we are solvent!)

we have 2 ISA accounts which we do not touch that have a dd for £25 pm going into we are slowly building these up.

we also have a savings account that although it is both of ours it is in my name only as i don't pay tax. This is our v big bills/ problems account. We try to avoid using this but sometimes it is necessary.

I think you both need to sit down together and write ALL your outgoings personal loans, petrol, shopping, baby things everything. Then work out how much you have left over. Work out how much of the left over you want to put into general savings and how much into never touch ever savings. Whatever is left can be split between you for personal use. Atm he is over £4000 a year better off than you which was fine when you were partners but if you are impacting on your career to bring up his child there needs to be a fair split of the finances. His hobbies will be curtailed as will yours (it's the bit of parenthood that is glossed over) you will choose other priorites for your money.

Whatever you do DO NOT hit your savings to avoiding impacting on his finances.

I'm a SAHM so each month DH transfers a certain amount into our joint/savings acct for household expenses and another amount into my account for my stuff. I decided on what that amount should be - it is generally less than what he has left but it covers me more than adequately and neither of us have large personal expenses. Every month we both transfer what is left in our accounts into the joint/savings.

The general rule is to have an attitude of "family money" in which all money is to cover all of us, no matter who earns what. Nobody should be flinging cash about on expensive stuff while the other is struggling.

We don't have a joint account because 1) DH hasn't got a very good credit rating and 2) I think that money should be kept separate.

DH works full time, I work part time. He earns just over double the amount I do, so he pays the rent and all bills. I pay for the food shopping and we both buy things for DS and childcare. If there is something we need for the house, we usually split it and pay half each. We each have our own savings account and savings account for DS.

People probably think this is strange in a marriage, but I believe in financial independence. If anything ever happened (not that I think it would, but you can't predict the future) I want to know I have my own bank account and money that is mine.

Whatever money we have left we can then buy what we want with. DH usually has more money left over than I do, but he also tends to treat us more, he buys takeaways etc.

I know a lot of people just share their money, and it seems to work in most marriages! I wouldn't want that though, but it's different if you're a SAHM. DM and stepdad are the same way as DH and I, so maybe it's how I was brought up.

We have a joint account where dh's salary goes into and I have my account where my salary used to go into. I'm a sahm now, but I always had my own account. It was used to save up some money (transfered into isas).
Now we only use the joint account, there is just car insurance on my account so I keep it topped up with a few £££.
We have always shared everything. Never had our own spending money. We trust each other not to spend too much, but my dh spends almost nothing on himself, has a cheap hobby.

He has always earned a lot more than I ever did, and that will probably never change.
I'm e one to deal with finances, insurances, etc so I spend some time to get good deals etc.
Whatever is left from the joint account each month nothing is put into an isa.
I couldn't imagine (when we both worked and had small children) to spend half on everything when I earned a lot less.
Surely that can only be fair when an actual percentage is paid based on the difference in earning.
What happens to the money he has left over? Savings? For him to spend on anything or for your family's future?

When we agreed to have children we both knew it would mean I wouldn't have a full-time job until the children are late teens. It is impossible with dh's job. I wouldn't feel happy if he then declined to put the money I enable him to earn in a joint pot.

Just one account that all money goes into and all bills come out of.

Please discuss financial arrangements befor you have babies.

It sounds as if he is selfish, tbh, and would not expect to fund you or any maternity leave or childcare.

Sorry but it really does not sound good.

You can each have your own account as well as a joint one, but the joint one should have enough for bills, childcare and food and rent/mortgage. Then you can each have some spending money of uour own for going out.

His strict 50-50 rings alarm bells, as usually men earn more (not how it should be, but that is how it is) and so wants to keep more money for just himself. Am I right?

Before we had kids we had separate accounts and a joint one that we put in 50/50 to cover house, bills etc.

I now work part time and have my own account still, of which i keep all my money and DH has his own account and earnings in his. We still have the joint account but i no longer contribute anything towards it and DH pays for everything that comes out of that account, but our tax credits and child benefit also go into that account, which i can use if necessary but rarely use and it keeps the account topped up.

With my wages/maternity pay when i was off work, i paid for childcare, food and all my own outgoings, e.g phone, loan etc.

This works well for us and rarely causes problems, but lots of people do like to have just the one account it seems

Just as an additional point, I did read somewhere, maybe on mumsnet, that whatever the intricacies of the financial arrangements were, in a partnership(married or otherwise) it is totally unreasonable for one of the partners to be financially worse off than the other. If that makes sense.

Thanks everyone for your continued advice. I hadn't really thought about it in terms of looking at our 'take home' payments over the course of a year, him getting over £4'000 more than me a year does sound quite substantial actually. He has got a half day tomorrow so I think I'm going to use the afternoon to sit him down and talk about it seriously.

See, thought it would be him earning more...

When I worked full time I earned the same as him, some months coming out with more than him but then I changed jobs and chose to go part time instead (30 hours). He probably sees it as being my choice to take that hour cut/pay-cut, which it was I guess

I was sahm and used the child tax credits and child benefit to pay for everything the children needed, I ran the family car(and took it when I left!), paid for the majority of the food shopping, all Christmas and birthday presents for dcs and both our families and anything I needed, he paid the bills. All accounts were separate we had nothing whatsoever in joint names. It appeared to work

We have a joint account for bills (mortgage, childcare and utilities) that we both pay an equal amount into each month. Our salaries go into our own accounts and our day to day spending comes out of our individual accounts too. We split the shopping as we go along. It works for us as we both work and don't have to justify what we spend to each other. DH also has maintenance to pay for DC so it makes sense to keep things separate

I sympathise Lipstick - but I think if a system like that works it's partly luck and partly the woman making it work. I think it's unlikely to be really fair, as it's not been worked through or talked through. We function with a vaguely similar system though DH does put something into my account to help balance things somewhat.
I guess a lot of families could do with talking more about finances, but many find it difficult ? As I said before I'm impressed by how organised many here are too.

OP

I think that situation like this can be fluid sometimes and change when one person becomes a SAHM for example.

However, we have always had a joint account from Day 1 of marriage 30 years ago.

All of DH's salary goes into it and about 2/3rds of mine- the rest of mine goes into another account where it is saved for paying tax- I am self employed.

This joint current account pays for everything- mortgage, food, bills, holidays, clothes etc etc etc.

In addition we each have our own ISAs and some shares. We've saved in these out of DHs bonus each year and any 'overflow' from my own account depending on how much tax I need to pay.

If we ever make a big purchase that can't be funded from the joint account then we take money from our savings - and decide who does this depending on current rates of interest etc.

Having some separate savings accounts each means we are both free to buy ourselves treats or pressies for each other without digging into the joint current account.

We discuss any spending in advance and if one of us thought the other was being reckless we'd say so.

The only couples I know of who each put £X into a joint pot then keep £x for themselves are couples who are on their 2rd or 3rd marriages and want to keep control of their money.

BenNJerry
People probably think this is strange in a marriage, but I believe in financial independence. If anything ever happened (not that I think it would, but you can't predict the future) I want to know I have my own bank account and money that is mine.

It doesn't work like that- if you split up, ALL your money would be pooled and shared 50-50 along with the rest of your assets. You cannot hold onto your savings and call them yours. In law the money is 50% your husband's. In a divorce you have to declare your savings and it's an offence to squirrel it away and hide it from the lawyers.

30 years on and we both still have our own accounts. One thing I have always tried to do is have equal savings even when I was working pt and not earning much. Never argue about money now, more savings than mortgage and v similar attitude to money. Also, both open about money and spreadsheet regularly updated with savings / shares. Also, both no debt - pay off credit card monthly. The way you run your finances definitely trickles down to your children - DS has more money in his current account than me & he is a student!

We have a joint account for all household expenses, but our own separate accounts into which our salaries are paid. We currently earn roughly similar amounts and each put the same into the joint a/c each month - this amounts to about 60% of our take-home pay. It's actually more than our usual monthly expenditure, but it's a nice round number and allows us to easily pay for holidays, special meals etc out of that account. The rest of the money is ours to do what we like with - in my case it's either saving or spending on professional exams at the moment!

If/when we have children, things will change in terms of our income, and we'll adjust the amount each person pays into the household account, accepting that both of us will no longer have as much "personal" money as before. All household/child expenses will still come out of that account.

I don't think we have the "holy grail" quite, but have found a near-enough position that works well enough for us now. Though if I had been a bit more knowledgeable earlier on, I might have pushed to do things a little differently earlier when I was on maternity etc.

What we do now is have a joint account, to which we both contribute what we've worked out to be a reasonable amount, which gives us reasonably similar money left over. All joint/kids' stuff (including expenses necessary for work, like petrol & cars) come out of joint funds, and our leftover money is for our own needs, clothes, activities etc. If we have any big expenses and need to add to the joint account, we agree a fair extra amount to put in each - he puts more in as he earns more (I'm P/T). Similarly if our circumstances change, we review what we each put in.

I don't think this is quite as even as having a joint account and then each taking out the same amount for personal spends, but it's good enough for our present circumstances.

However - if I was to go on maternity leave again, or one of us lose a lot of earning power, I would probably push for the joint-account-plus-equal-spending-money option, to ensure we both had enough individual money for fairness, and felt able to spend "our bit" as we wished.

All the other options fall down at the point where one of you is on maternity or otherwise has a big reduction in income. If you are contributing equal amounts, it doesn't work if one of you can't contribute that any more (or feels they have to go into their savings while the other one doesn't). But not contributing and yet getting no money for yourself would not be fair either, when you're off work due to your joint baby!

I also don't recommend the "contributing same proportion of earnings" model, e.g. where you both pay in the same % of whatever you earn. This sounds fair in theory, and it works reasonably well if you don't have a massive earnings gap. But when there's a big gap, or especially if one of you starts earning very small amounts (or nothing), for example on mat leave, it gets very messy, and unfair on that person. At these times, to have any sort of equality it may be necessary for the lower earner to drop or stop their contribution altogether, or actually be given money by the earning partner, to maintain a fair amount of spending money.

mrs mark that's true, but actually 50% is the starting point not the rule. Also having your own account with some cash in it does stop one partner clearing out the joint account and leaving the other penniless, which they can do legally because funds in a joint account are owned by both of you, not 50/50, so both of you are legally entitled to clear it out and spend it on a week in the Bahamas with your Internet fling any time you want.

There are advantages and disadvantages to every set up but the best way IMO from a combined financial equality, admin hassle,, tax and 'cover your ass' standpoint is a combination of joint and personal accounts.

Most of our money is separate, but we each transfer 50% of outgoings to my wife's current account every month.

The rest, well, it's at the discretion of the person who earned it. That can mean saving it, spending it on treats or spending it on something personal.

However, we are both savers. If we weren't then I don't think this way would work very well. But I know my wife is very prudent financially. So if she does buy something expensive, I know she has saved up for it.

As for treats, whoever feels like paying for it pays for it. We have similar incomes and no kids which I suppose helps.

It doesn't work like that- if you split up, ALL your money would be pooled and shared 50-50 along with the rest of your assets. You cannot hold onto your savings and call them yours. In law the money is 50% your husband's. In a divorce you have to declare your savings and it's an offence to squirrel it away and hide it from the lawyers

This may be partially true but you are in a much stronger starting position if you have your own money at the point of separation. i.e. you can afford to pay for your own new life. the downside is that you are unable to demonstrate a high level of financial dependence on your husband which might impact on your ability to make a claim for spousal maintenance.

also, there are so many exceptions to 'everything in the pot 50:50 division' that you cant really make assesssments on that level without further detail
a better way of looking at it is

1. meet needs
2. assess whether assets are marital
3. apply sharing principle

I think some of you have slightly missed the point over 'hidden assets' .

A few years ago DH and I were going through a bad patch and I took legal advice, as we were considering splitting up. I had always comforted myself that I had quite a lot of savings which were for 'emergencies' and in my own accounts.

Now whilst it's true that this money would have enabled me to move out, rent a home for a year or more and support myself, ( and I earn much less than DH) those savings would not have been 'ignored' in a final settlement. It would have been taken into account in terms of who got what financially.

So I agree that it's good for everyone to have access to some money in their own name, you can't have, for example, £100K in your own account and expect to keep it with no questions asked if you split up.