What You Need to Know Before Combining Finances (2024)

This post is by our regular contributor, Erin.

So you’re at the stage where you think it might be a good idea to combine finances with your partner.

But you’re not sure how to go about doing it. You just know you’re sick of keeping track of who paid what last, and who’s turn it is next. Or how much you owe each other for rent.

I’ve been there. When my fiance and I first moved in together, he wrote the check for rent, and I transferred my half to his account each month. We took turns buying groceries and paying for dinner out. It got old pretty fast!

When we moved, neither of our banks had locations here, so we decided to get a joint account and start anew. That made the decision pretty easy for us, but for others, it’s not as simple.

Here’s what you need to know before combining finances, and a few options on how you can do it.

Don’t Jump Right In – Talk It Over First

First, combining finances at this point may or may not be right for you as a couple. There’s also no right or wrong way to do this, despite what a lot of people may say. Every relationship has a different dynamic, and you need to find out what works for you.

Please, please have a serious discussion with your partner about this beforehand, and don’t spring it on them. Some people are fine combining finances, and others are reluctant. It all depends on your situation.

Perhaps one of you has been married before, and you’re not sure if you want to share your assets yet. Or maybe one of you was put through the ringer by an ex who used your money irresponsibly in the past.

Whatever the case may be, you need to be sensitive to the fact this is a serious matter. Saying “your money is my money, and my money is your money” has a lot of implications, especially where debt is concerned. We’ve touched upon it in the past, so please read up on how to handle debt in a relationship before committing to merge your finances. And this goes without saying, but at this point, you should both be fully aware of the others financial situation.

When discussing this with your partner, figure out why you want to combine your finances. Is it for convenience? Because it’s a show of commitment? Because you truly love and support each other no matter what? Because you’ve practically been sharing money for years anyway, and just haven’t gotten around to it? Your “why” is important to know.

Once you’ve talked things over with your partner, you’re both ready to figure out the how.

Combine Everything

Of course, one option you can go with is to combine everything. Have a joint savings account and a joint checking account. Maybe a joint money market account, if that’s your thing. You can even go so far as to add each other on your car insurance if it’s cheaper. It’s up to you.

Depending on how much money you’re each bringing to the table, I would hesitate to recommend this route to a couple that isn’t married or hasn’t been together for a decent amount of time.

Obviously, if you’re both broke college grads trying to get established in your careers, combining might not be a huge deal. Sharing a few thousand probably won’t make or break you.

However, if you each have a substantial net worth, make good salaries, and don’t have any debt, you might want to be a bit more protective of your money.

Being married makes it a bit easier to share!

Selectively Combine

This is the option my fiance and I chose. We have a joint checking account, and we each have our own savings accounts (that are linked to the joint account). I also have a completely separate business account. When we moved, I had more money than my fiance did, but since it’s been a year (and during part of that year, I wasn’t earning anything), the joint account is an even pool of our money.

We share all living expenses. The rent, groceries, utilities, cell phone payment, car and renter’s insurance, etc. come out of our joint checking account.

Our student loans used to be paid out of that account as well, but when I opened my business account, I decided to use the funds in there because I wanted to pay extra. Since my income is going into that account, and my fiance’s paycheck is going into the joint account, I figured it was fair. My retirement contributions also come out of my business account, and my fiance has a 401(k) through work.

It doesn’t matter who’s paying for what or who’s account it’s coming from, though. We’ve always been very open about our finances, and we’ve discussed making various purchases with each other from the start. I have a separate account for my business because it’s convenient for tax purposes, but if WE needed money, I wouldn’t hesitate to use it.

Forgo Combining Completely

If, after talking with your partner and reading through these choices, you don’t think you’re ready to manage your money together, that’s okay! Especially if you’re not married. I wouldn’t exactly recommend merging everything if you’ve only been together for a year.

I also hate to say it, but these days, divorce is common. I’m not going to get into a discussion on it, but suffice to say, anything can happen in the future, whether you have a marriage certificate or not.

And sadly, getting divorced can be a financial nightmare. Does that mean you should never merge finances with anyone? Of course not. But it’s always best to be 100% aware of your partner’s financial situation.

It makes me sick to hear stories about one half of a couple hiding something like a gambling addiction, massive debt, all financial account information, etc. Even if your finances are separate, you each deserve to be kept in the loop on some level. You still have to work as a team, and keeping things separate doesn’t mean you should be hiding things.
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As a couple, you need to have a joint game plan for your money, whether it’s kept separate, sort of together, or completely together. It’s important to focus on working as a team and allowing each other to function individually within that team. That means having equal say in things like creating a spending plan!

Balance is key – one partner shouldn’t feel like they have less control or less say because they earn less. If you combine your finances, that ceases to matter. It’s one shared pool, and you need to get past who might be contributing more.

Have you combined finances with your partner? How do you make it work? How long did you wait to combine your money? If you manage things separately, how do you still work as a team?