Your Guide to Money Management in a New Marriage

How to combine your finances before marriage and get on the same page with your partner.

Combining finances before marriage is a rite of passage for many couples. Establishing shared checking, savings, and credit card accounts can be complicated, especially for those who have student loan debt, own property that dates before the marriage, have been married before, have children, or own a business or other assets.

In a 2021 survey conducted by Ramsey Solutions, 41 percent of married couples said that they fight about finances. With this guide, you can open the conversation before marriage to help prevent conflict in the future.

Discuss Shared Priorities

Setting financial goals together creates the foundation for a healthy household budget. Depending on your current phase of life, some of the mutual objectives for you and your partner may include:

• Saving for a first home, new home, or vacation home
• Optimizing your retirement investments
• Paying off debt
• Starting a new business venture
• Traveling the world
• Saving for higher education expenses
• Building a legacy for your children and grandchildren

This conversation can open discussions about each spouse’s personal financial views. Often, childhood experiences shape these ideas and beliefs. You could introduce a “financial date night” to transform one-off conversations into an ongoing dialogue.

Understanding where your financial values diverge can help you compromise and avoid issues before they arise. Some of the questions you should ask in this phase include:

• What are your feelings about money, both positive and negative?
• How much debt do you have? What are your plans to pay it off?
• Do you follow a budget or use a less regimented approach?
• What are your goals for our financial future?
• How do you approach saving for near-term goals like a new car?
• How would you spend an unexpected windfall?
• What’s your credit score?

Clarify Your Financial Situation

Complete transparency is essential when combining finances with a new spouse. This is your opportunity to get everything on the table and start your marriage with a clean slate.

Block out some time to sit down and conduct a comprehensive review of both partners’ income, assets, and expenses. Use this checklist as a guide:

• Accounts
  • Checking
  • Savings
  • Flexible spending accounts
  • Health savings accounts
  • Brokerage accounts
  • Retirement accounts, including 401(k)s and IRAs
  • Certificates of deposit
• Assets
  • Personal property
  • Collectibles/Valuables/Jewelry
  • Vehicles
  • Real estate and land
  • Projected annual salary, bonuses, and other compensation
• Debts
  • Credit cards, including store cards
  • Mortgage
  • Auto loans
  • Medical bills
  • Student loans
  • Tax debt

If either of you owns significant assets such as business or real estate holdings, you may need a professional valuation to inform a prenuptial or postnuptial agreement about your finances. For example, you can establish a family home as a separate asset so it can remain with you in the event of a divorce.

Make a Budget

Using the information you gathered in step two, create a realistic household budget that covers your expenses and funnels savings toward the goals you established together in step one. If you aren’t sure where to start, try using a simple spreadsheet or online template.

You can set a monthly budget meeting where you review your income, expenses, and goals as a couple. Even if one budget-savvy spouse does most of the math, the other should still be aware of the family finances and have a say in money-related decisions.

Decide How to Share Expenses

Some couples choose to split expenses evenly, while others contribute to the household proportionally based on income. When one person stays home and the other works, discuss a fair way to split spending money.

You’ll also need to decide whether to combine all your financial accounts or retain some separate accounts. Many couples opt for the yours/mine/ours framework. With this structure, you each maintain accounts for separate expenses and savings while also contributing to new, shared accounts.

You might benefit from this type of arrangement if you each have separate, specific financial needs, such as a work wardrobe, student loan payments, or an expensive hobby or membership. Some people simply prefer to retain financial independence or have very different money habits than their partner. Others want to stay on the same page, even with small purchases.

Establish Joint Accounts

At a minimum, you and your spouse should share a savings account for household emergencies and a checking account for daily expenses and bills. Merging some, if not all, of your finances can help you strengthen your relationship by working toward shared dreams and goals. It can also prevent financial infidelity, a common cause of divorce in which one or both partners omits information or misleads the other about money issues.

After setting up joint accounts, don’t forget to update your automatic debits and direct deposits. At this point, you can either retain or close your separate accounts, though you may want to keep your credit cards and add your spouse as an authorized user to avoid impacting your credit by closing a longstanding account.

Speaking of emergencies, building an emergency fund if you don’t already have one provides the foundation of financial security. Most financial experts recommend saving at least three times your monthly expenses in case of job loss, illness, injury, or another unexpected incident.

With this guide, you’re ready to combine your finances with your spouse and move forward in your marriage with a team approach to money.