Cash & Coupling: How To Create A Budget After “Two” Becomes “One”

Your honeymoon bags are unpacked and your tan is starting to fade. He’s getting used to picking up Tampax at the grocery store, and you’re getting used to picking up his toenail clippings from the bathroom floor. Hello, real life. It’s time for the next challenge: combining finances.

Financial experts agree that because money-related issues cause the most friction among couples, the best thing a new couple can do is bare all when discussing money. We consulted Stacy Johnson, financial expert and author of Life or Debt, for some specific advice on how to let go of a lifetime of going dutch, and embrace creating a budget for two.

Become acquainted with your partner’s financial personality.

You know basically everything about your guy: the details of his first time, how he likes to eat his fries (with mayo) and the fact that he enjoys reading Us Weekly more than you do. Now it’s time to learn all about how he feels about saving, spending, frugality and debt, says Johnson. If you’re a spender and your partner is a saver, it’s not necessarily a relationship killer, but it could create problems in the future. In order to prevent it from causing some major friction down the road, you’ve got to talk about the ways you’ll deal with it — on the front, not the back — end. The earlier you know about your partner’s saving and spending style, the easier it will be to craft a budget with which you can both happily live.

Create a worksheet with your net income and expenses as a couple.

Ever heard the expression “get it in writing”? It’s particularly helpful when you’re combining finances. It doesn’t have to be elaborate — maybe yours is a detailed spreadsheet taped to the refrigerator door, or maybe it’s a plan written on the back of your cocktail napkin. Either way, make sure you include the essentials such as mortgage/rent, insurance, utilities, car payments and debt, Johnson advises. Don’t forget the non-essentials such as eating out, pet food, the bar tab and your bi-monthly spray tan. Add it up. How much money is coming in? How much is going out? Is there any left over at the end of the month? Having everything on paper will help you both be accountable to your individual responsibilities in adhering to a budget.

Determine how to divide the expenses.

Finally — here comes the tricky part. Every couple must decide whether to fully combine all income, paying expenses from a communal account, or keep individual accounts, dividing expenses among each partner. Believe it or not, Johnson says he’s known plenty of successful couples in both camps. While he most often advises couples to combine incomes to achieve financial goals together, for a new couple for which marriage isn’t on the immediate horizon, he’d likely recommend contributing to a mutual budget while retaining the rest of their income to control alone. If a couple decides to keep their money separate, he believes that when it comes to joint expenses, it should be very clear from the outset exactly who’s responsible for what. “The last thing you want is for one person to feel taken advantage of,” he cautions.

Continue to talk about it … even after you’ve figured it out.

“The most important thing about the way you choose to divide common expenses is to make sure you don’t just set it and forget it — you have to talk about it,” asserts Johnson. Never assume your partner feels comfortable with your financial practices — check-in regularly to make sure you’re both on the same page. “Find something that works for you and bring it up with one another every now and then to make sure it’s still working,” Johnson advises. The key to living a financial fairy tale with your Prince Charming is in your control, Cinderella.

The Money section and all articles within it are sponsored by Free Credit Report; however, the articles are all independently produced by The Frisky and the opinions and views expressed by the writers and experts are their own.