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Tips for Managing Your Finances as a Married Couple

Managing Your Finances as a Married Couple

There are many tough financial decisions that married couples face. These decisions regarding how to handle household finances shape your future. They should not be taken lightly and warrant an honest conversation with your partner. However you and your partner decide to handle your finances, it is essential that you foster a communal relationship in which you work together and respond to each other's needs. Often, disagreements and arguments around money arise due to a disconnect about how money should be handled, a clash in each others' philosophies around money, and when one partner resorts to being protective (i.e., this is my money, not yours). With that said, here are some common ways married couples handle their finances...


Merge Your Finances Completely

With this method, everything becomes combined regardless of the amount of assets or income each partner brings into the marriage. All income goes into one shared joint account; any bill payments, savings, and investments come from this account.  


For many newly married couples, this can be challenging to do immediately. You may feel that you spent decades accumulating wealth and earning a higher salary, and sharing it may make you uncomfortable. In doing so, you may even feel like you are sacrificing your financial freedom and derailing your long-term financial plan.


In a 2023 study conducted by the Indiana University Kelley School of Business, couples who merged their financial accounts experienced significant benefits. The research revealed that participants who merged their finances reported better relationships, fewer conflicts over money, and overall satisfaction with managing their joint finances. These couples felt a sense of unity within their marriage, as they felt like they were 'in this together.' Therefore, by merging finances, you can reduce financial conflicts and improve your overall relationship satisfaction.


Keep Your Finances Completely Separate

In all likelihood, while you and your (now) spouse were dating, you each maintained your finances separately – you paid bills separately, and any joint expenses were possibly covered by one person or charged to one and reimbursed by the other. Effectively, this would be the same as how you and your spouse operate financially in your marriage.


Keeping accounts separate, especially for newlyweds, is likely where you are most comfortable starting out. This is often a great starting point because maintaining separate accounts can actually kickstart necessary communication about money – who will pay for what, how you will save for shared goals, what happens in an emergency, etc. How you decide to pay for shared expenses is ultimately up to you and your spouse, but keeping an open dialogue about how costs are fairly being split is crucial. 


In practice, there are different ways of doing this. We often see this method when one spouse has a substantially different level of assets or there is a significant income disparity. In such cases, a fair approach could be to split bills proportionate to your respective incomes – the spouse who earns more pays more and vice versa. This way, you can maintain your individual financial independence while contributing to shared expenses and fostering a sense of fairness and understanding in your relationship.


A Hybrid Method Where Some Accounts Are Shared and Some Are Separate

This is a great first step, especially for newlyweds, towards combining all assets. It is common for married couples to want to keep at least some money for themselves to purchase what they please, regardless of the length of time they have been together. The great thing about a hybrid method is that you and your spouse share fairly for joint expenses while giving you some freedom to spend your remaining surplus money on things you want.


This method starts by opening a joint account. Each spouse then contributes a certain amount of their income to that account to pay shared bills. If you want to take another step, you could open a joint credit card and use this card for joint expenses. Then, you can pay off the balance monthly using the shared account.


Other Things to Keep In Mind

Understanding your partner's debts will give you a sense of the lifestyle you both will live. If your spouse has a high amount of debt, it is worthwhile to create a joint budget to ensure that all bills are paid, debts are paid down, and potential savings toward long-term goals are not forgotten. There are tons of different budgeting systems, but a common one is the 50/30/20 rule:

  • 50% of income should be allocated to 'needs' (e.g., shelter, transportation, food, utilities, healthcare, etc.)

  • 30% towards 'wants' (e.g., dining out, entertainment, hobbies, etc.)

  • 20% towards 'goals' (e.g., retirement, down payment on a house, kids' education, etc.)


NOTE: Be careful if you and/or your spouse have federal student loans. Loan servicers use your income to determine how much your monthly payment is, and if you file your taxes jointly with your spouse, it could raise that monthly payment amount. Talk to your tax preparer or financial advisor about this topic to see whether the tax breaks you receive as a married couple outweigh potentially filing your taxes separately.

Changing the beneficiary designations on your retirement accounts after you get married is also important. By law, if you do not name your spouse as the primary beneficiary of your retirement account, the spouse will likely need to sign off on the alternative designation.


If you change your name, be sure to update your employer and any banking and investment accounts. Most likely, each financial institution will have paperwork you will need to sign to make the change. They may also ask you to present some supporting documentation of the name change and, potentially, your marriage certificate.


Try to find ways to automate your finances.  This will reduce your workload and likely alleviate stress. Automation comes not only in the form of bill paying but also in saving. Additionally, there are lots of technological tools available for free or a small fee to help you track everything. If you need help managing your finances, consider seeking out a fee-only financial planner. We can help you develop a personalized plan for your financial future.


Circumstances evolve in a marriage. For example, a spouse may lose their job, you and your spouse may need to relocate due to a job opportunity, a spouse may stop working to care for children, etc. Therefore, family financial arrangements may need to change for practical reasons. Having open lines of communication and a planning approach will help smooth the transitions that occur over time in any marriage.


Lastly, money can be a difficult and stressful subject for couples to talk about. The bottom line is that honesty is paramount.  Whether you decide to merge your finances with your partner completely, keep them separate, or find some middle ground, talk to your partner about your concerns and try to find a workable solution that you both are happy with. Make a plan to sit down and discuss not only logistics but also long-term financial goals so you both agree and understand the plan. Once you make the initial plan, continue to discuss your finances regularly with each other. There is no reason that money talks cannot be healthy, free-flowing, and ongoing.


If you and your spouse are looking for a financial advisor to help manage your finances, check us out! You can schedule a complimentary, no-obligation call with us here.


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About the Author

Holzberg Wealth Management is a family-owned and operated financial planning and investment management firm based in Marin County, CA. As your financial advisors, we serve you as a fiduciary and are fee-only, so we never receive commissions of any kind. We help individuals and families like you in the greater San Francisco Bay Area and virtually nationwide with the financial decision-making process to organize, grow, and protect your assets.



** This writing is for informational purposes only. The author and Holzberg Wealth Management do not guarantee or otherwise promise any results that may be obtained from using this report. No reader should make any investment decision without first consulting their financial advisor and conducting their own research and due diligence. These commentaries, analyses, opinions, and recommendations represent the personal and subjective views of the author and do not constitute a recommendation, offer, or solicitation to make any securities transaction. The information provided in this report is obtained from sources that the author believes to be reliable. External links to third parties are being provided for informational purposes only. Holzberg Wealth Management is not affiliated with the third-party websites linked to, unless otherwise explicitly stated, and does not constitute an endorsement or approval by Holzberg Wealth Management of any of the third party’s products, services, or opinions.

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