Monday, May 16, 2016

Getting Married Doesn't Need to Mean Marrying Finances

GETTING HITCHED DOESN’T NEED TO MEAN MARRYING FINANCES

Marriage generally implies that two homes and lives become one. Should it also involve a complete merging of earnings, assets and expenses? With money arguments being one of the leading causes of failed marriages, combining finances can be scary. For some couples it’s the right approach, but there are several other options.

THE TRADITIONAL APPROACH


ust a few generations ago, one spouse was generally the breadwinner who paid all the bills. Although today most marriages involve two people who work, the traditional approach isn’t entirely obsolete. It can be effective when one partner is a stay at home parent or full-time student, or one spouse earns much more than the other. It’s also appropriate for couples choosing to bank one income to save for shared goals, such as a down payment for a home. Single breadwinner couples may merge assets or maintain separate accounts.
This type of arrangement works best when both partners have similar financial styles so that no one ends up feeling like a child having to ask for spending money or resenting the other for spending too much.

THE SHARE-EVERYTHING APPROACH


With this option, couples completely merge financial assets and responsibilities. All investments and debts are in both names and bills are typically paid from one joint account. Sharing everything works particularly well for couples that enter marriage with similar incomes and limited assets. As with the traditional approach, it’s vital that spouses have compatible styles to avoid feelings of resentment or deprivation.

THE FOUR-ACCOUNTS APPROACH


Sharing is beautiful but sometimes it’s also nice to have a little something of your own. With this arrangement, both partners contribute equally to a joint checking account used to handle household expenses and joint savings to reach shared goals. Their remaining income is deposited to individual accounts to be saved or spent at each partner’s discretion. This approach makes sense for couples with comparable incomes and debts, or when one partner is much more frugal than the other, since it lets both manage money as they see fit without straining the relationship. In cases where one spouse earns substantially more than the other, couples may want to contribute a percentage of their income as opposed to a fixed monthly amount to the joint accounts.

THE WHAT’S-MINE-IS-MINE APPROACH


Some couples may simply be more comfortable maintaining totally separate assets and liabilities. With this approach responsibility for household expenses may be split equally, divided according to ability to pay, or each spouse may pick which bills to cover. Keeping finances separate may make sense if one partner has a much larger income, net worth or debt than the other. When entering into marriage with vastly different financial positions, it’s also a good idea to consider a prenuptial agreement, whether or not separate or joint accounts are maintained.

WHICH WAY IS BEST?


Whether and how completely to merge finances is ultimately a matter of individual style. With honest communication and trust, any of these vastly different approaches can work, giving those who choose what feels right a good chance at avoiding the bitter money conflicts that plague so many married couples.

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5 comments:

  1. The most huge mistakes for some is the "What is mine, is mine" approach, you enter into a life of marriage and everything should be conjugal. Sharing should be a great approach as it also bind you with your spouse, you share the same house and all, it's best to share the earnings and finances as well. With this, every couple could learn how to budget their money and share ideas with their spouses on what's best for their family. It's a great bonding time too and communication is the key so that there will be no complications or whatsoever. In light to that, they would learn the value of sharing not just to themselves but to their kids as well. And for that, I'd also want to share where you can go when you want to buy essays online and get great results.

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