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

writer don't feel bad that you don't think your DH is not with you on this, i think alot of the problem is that for a woman, you essentially become and,start thinking like a mother from the moment you see that line appear on your pregnancy test. It takes a man a hell of a lot longer than that so at the moment you are waiting for him to catch up with your way of thinking.

Its nice that he is thinking of you and the baby in terms of buying a new fridge and a nursing chair, but you need to try and communicate that he needs to be thinking on a more basic level than that first. This means getting yourselves, as a unit, into a better financial position overall by paying off credit cards and loans so you don't have this added financial pressure once baby is here. You can use some of your £10k to do this and use the time until baby is born to essentially pay yourselves back into your savings.

You sound like me 9 months ago!

Have you worked out how much the interest is on the loans and credit cards?

I'd be surprised if any savings account is paying you more than 2%- and max. 3%. savings rates are appalling at the moment. There was a financial feature in a broadsheet a few weeks back showing how savers had suffered something like 700 interest cuts last year!

On the other hand the interest rate on the loan could be 5% or higher and credit cards are something like 30% interest on outstanding balances.

It's nice he thought to buy the fridge- but again, shouldn't that have been a joint decision and a joint purchase? I'd actually be really miffed if DH bought something like that without my input into what sort I wanted!

Teen's suggestion is how our finances work and imo is the best way with dcs.

Thankfully our Wedding Credit Credit is currently interest free. Interest starts in 5 months, hence why it would be ideal to just get it paid off. I don't know what the interest is on his personal loan as it isn't something I have anything to do with.

Regarding the fridge - it's just a fridge To be fair we did need a new one and he paid for it out of his own money and didn't ask for a contribution from me so I saw no reason to make an issue of it. The kitchen is his domain anyway, I'm lucky to be married to a man who is happy to do about 80% of the cooking

I agree, Teens set up is kind of how I imagine things to be.

All our wages have been going in to one joint account since we were both aged 18. Everything goes out of that.

Your both on high wages so Im sure you will be fine. There will still be money for cars and stag nights, the baby and the house on that unless you are doing something very wrong!

I'm not having a go- really:) BUT this comment seems to suggest you are not thinking like one half of a couple.

and he paid for it out of his own money

Legally, he doesn't have any money of his own.

Maybe that's not what you really meant- maybe you meant his own savings- but if you are to sort out your finances then you need to talk and think about this 'his' and 'mine' idea!

I think I'd be on solid ground to say that 99% of married couples would buy something like a fridge out of the joint pot if there was enough in it- and if not to discuss where the money would come from.

When I married DH I moved into his house which he had been buying for 2 years while we were dating. I relocated 100 miles,and gave up my job at the same time. As we married relatively late ( in those days) and were keen to have a family sooner rather than later, I only worked for a short time in a temporary job before I became PG. But from our wedding day onward we had a joint account, from which all the household bills and furnishings were bought.

I kept my own savings accounts as did DH and I kept my own credit cards as well though we also have a joint one for all our household outgoings.

I do see where you are coming from - moving into his home- as I did that but I also think you need to establish a more equal footing and protect your interests because when your baby comes you won't have access to as much of his income as you might need, unless he allows you to access it.

mrsmark i was wondering whether you have any legal qualifications? youve made several references to what the legal position is which are wrong.

some of your advice is sensible financial planning but ultimately it comes down to a question of choice

i make all financial decisions entirely independently of my partner. we have been living together for 5 years and have 2 small children. this does not mean anything other than it is the way it works for us.

We pay our salaries and CB into a joint account. All DD's go out of this, including things that either we both have (mobile phones, contact lenses) or things we have agreed are mutually beneficial (into a pension for me as my works one is worth less than DH's). Swimming lessons and kid stuff comes out of this account as well. At the end of each month we split what is left into thirds, one third into each of our own personal accounts and 1/6 into ISA's for each of us. Then we each have our own money for meals out with friends, clothes, hobby bits (usually about £200/month each unless big car expenses or something else), we each have savings and there are no rows about who is paying for fuel or food. I earn about 60% of what DH does.

I think because at the moment we don't have a joint pot it IS seen as him having his money and me having mine - which is exactly what I want to change

Does anybody know how much child benefit a family receives? Is it dependent on salaries?

If he is expecting you to pay the costs associated with your pregnancy and still contribute 50% while on maternity leave, have you considered invoicing for the child care you will be providing for his child on the 2 days he works? 50% of nursery fees would be reasonable.

You lose CB if either of you is a higher rate tax payer.

Inertia - that saw by I like the idea of us putting money into our joint account based on a percentage amount, because then as my pay goes down with maternity my contributions will also be reduced, which he will then have to 'top up' from his wages in order to ensure our finances still remain stable.

I do think though that in terms of our own 'spending money' we would agree a equal amount as opposed to a %age of our wage as I don't think it's fair I be punished because I'm staying at home with the baby whilst he continues with his well paid job I think someone up thread said she and her partner have about £200 each to themselves, sounds about fair

The loss of CB for higher rate tax payer is I believe on a sliding scale.
start losing it ~50k, all gone ~60k. The higher rate person has to either register for self assessment, or choose not to claim.

And our system , as you were asking:

Joint account to pay all bills and direct debits, and savings standing orders come from this account as they are predictable.

DH's account was converted into a joint account when I became a SAHM so that I had access to spending money- still joint now.

I kept the account which was in my name, as it was registered with payroll and my part time salary is now paid into it- this money is generally spent on work on the house, DIY, car servicing etc. It's not treated as my money (DH didn't want his name added to the account).

We set up a separate account and credit card for baby related purchases, and the CB went into this. The CB was used exclusively for things the children needed (clothes, shoes , baby items).

We have a savings account which covers Christmas and birthday presents through the year.

Sharing bills 50:50 and then each keeping the rest of your earnings as personal money if you are also contributing 50:50 to the rest of the household - cooking, shopping, childcare. Soon, I imagine, you will doing a lot of childcare (at home on ML) and DH will be doing only round the edges. When that is the case then he needs to contribute more cash.

I favour TeenandTween 's suggestion as being the fairest and easiest.

Congratulations, by the way You sound very sensible about money so I am sure it will all be fine. Good planning to address this before you stop work, too.

oops, missed an "is fine" in the first phrase

suzie no I haven't. Please feel 100% free to correct me because if I am wrong then I've been misinformed by a lawyer whose advice I took at one point. If you wish to clarify anything then do go ahead! Be good for everyone to know what's incorrect.

We live together and have separate finances and it's never been an issue. I pay him £350 a month towards mortgage and bills, a token amount really but he earns a lot, a few times as much as me.

I think having a joint account would drive me crazy as IMO he wastes money. It's within his means but he's a member of two golf clubs he barely goes to, the most expensive gym around (I go three times a week to my much cheaper Virgin one and he's never seen at his!), subscribes to loads of expensive magazines every month which he doesn't read, loads more... just thinking about it makes me irate!

mrsmark im not going back over the particular references but you imply that assets which belong to either party in their sole name are in fact beneficially owned by the parties jointly by virtue of their marriage

this is not true

as a question of property law, assets held in either parties names are assets belonging to that party. in the event of a marital dispute resulting in financial remedy proceedings, the assets held in either parties sole name might be shared to achieve fairness (not equality as you say with the 50:50 ref) but they might not, depending on the prevelant circumstances.

legal advice given to one individual cannot be applied to other circumstances.

Everything goes into big pool, joint account and joint savings (I wish). I brought more in, flat and generous family, used to earn more than him but now he is very much the biggest contributor.

He is good at making money but terrible spendthrift, not helped that he travels a lot for work and gets horrendous credit card bills. The only way it works is if I am in charge of everything.

It has been a long journey, but after 15 odd years I think that we are finally getting understanding between us. It has been the major source of conflict in our relationship.
Advice in retrospect, talk about it a lot and don't let the little things get away.

suzie are you a divorce lawyer? I only ask because a friend of mine is going through a divorce with a top city legal firm, which handles high profile and high cost divorces - and paying £500+ an hour for the privilege. She doesn't work and has always assumed that as a starting point for any settlement, half of what her DH owns ( eg company shares) is hers and the starting point for a division of assets which may be 50-50 , or 60-40 or whatever.
In other words as a non-working wife she believes that whatever cash is in the bank, in property and in shares etc is equally hers until divided otherwise.

im not quite sure whether youre telling me that to try and intimidate me into accepting your words or to offer me work!

if you'd like my credentials, i am a divorce lawyer and i work in a similar firm for similiar clients to your friend (mostly fighting about sums in excess of £5m) and am listed in legal directories for central london for 2013. the only slight difference to what i do is that i work for on a flexible basis and am self employed so am able to charge much lower fees to my clients (£260 p/h).

your friend does not own any of her husbands assets. it would be totally impossible for the commercial world to operate if she did. she owns the things which are in her name, or in joint names with her husband. she is not beneficially entitled to the things in her husbands name.

she may obtain a settlement which includes value derived from those assets but that will be because the court determines she is entitled to a share in them. slternatively it may say that some of them are not marital property and therefore she isnt entitled to a share in them and their value is ringfenced before determining the division.

the percentage division will depend on all manner of things including whether one party takes riskier assetsand/or non cash assets, the length of the marriage and ages or the parties

even if she were to achieve a 50:50 division, that does not mean that half the husbands assets were 'legally hers' as you have put it. it just means the court (or some other dispute resolution forum) has determined that she is entitled to a share of his assets.

but we digress

That's good to know suzie. No of course I'm not trying to intimidate you. what would be the point in that? And yes their assets are above those you quoted. What I was trying to ask which is pertinent to the OP is that my friend has always lived and behaved as if the income her DH earns, is half hers. When he talks about 'his income' and 'his shares' that are part of his salary then she is quick to tell him they are not 'his' but 'theirs'. This is because she ( and I) have always believed that the law considers all assets to be jointly owned in principle even if, like a bank account in 1 name only, they are not.
So if we have both been living under a rock all this time thank you for making it clear.