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Should Couples Combine Finances?

written by: M Lambert•edited by: Jason C. Chavis•updated: 5/24/2010

Finances can be a sore topic in any relationship. If you are married, it is beneficial to combine finances, and you have laws protecting you if you were to get divorced. However if you are single you should not combine finances. Learn the best way to split your household costs as a couple.

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    Combining Finances

    It can be a big deal and scary to combine finances with your significant other. This means that you take on each other’s mistakes and financial problems. This can be especially trying if one person was very disciplined and responsible when it came to finances. For this reason you should not combine finances until you are married.

    If you are living together you should handle your finances separately. However, you should both be equally responsible for shared expenses. This would include rent, groceries, and utilities. You should buy your own car, and cover your own insurance. If you have a child together you should split those expenses as well. If one person makes more than the other than it is not fair to split these expenses fifty/fifty. It is much more fair for each of you to contribute the same percentage of your income.

    For example you determine that your shared expenses are $1500 a month. One person makes $2000 a month and another person makes $3000 a month. To figure out how much each person should contribute you divide the amount of shared expenses by the amount of your combined incomes. Then you take the percentage that you receive and divide it by your individual income amount. In our example you would take $1500, divide it by $5000 ($2000 +$3000), and get the number 0.3 (or 30%). Then multiply 0.3 by $2000 to get $600 and $3000 to get $900. Each person is paying 30% of their income equaling $1500.

    Once you get married you need to combine your finances. This means that you take on each other’s debt and work together to pay it off. You also invest together and plan for retirement together. It is crucial that you be completely honest about your financial state before you get married, so that you can have a successful marriage. You can work through this together with planning and talking. You should not hold past mistakes over your spouse’s head later on in the relationship.