This is a guest post from WC, a guy in Chicago that writes about money at The Writer's Coin.
In May, I will celebrate my two-year anniversary with M, my favorite person in the world. I thought I knew a lot about everything before we got married, but now I'm wiser. So for all the newlyweds out there, or the ones thinking of walking the plank getting married, here are some things you should know.
There is no I. Marriage is all about the “we”. It's not “your” money or “my” money, it's “our” money. It isn't your retirement, it's our retirement. It's not an easy concept to grasp, but you'd better adjust because when you get married you really don't have a choice. The sooner you accept it, the easier it will be. Don't fight it…As you'll see, this will become a recurring theme throughout your married life.
There is no “right” way to do things. When M and I got married, I checked my bank and credit card accounts every day. M did not — she just made sure there was always money left in her account at the end of the month. When I showed her my method, she was taken aback, but she saw some use to it.
So we found a middle ground: we sit down and run through our budget midway through the month and at the end. It gives us a checkup halfway through and then at the end we check to make sure we met all our goals. It's like a challenge and it works for us.
Maybe you use a fancy spreadsheet you run through every month that tells you exactly where your money is going. Or maybe you use Mint to track your spending. Or you might be one of those people that does it all in their head — no paper trail necessary.
Either way, it might be the way you do things, but that doesn't mean it'll be the way we do things. You will have to adjust and find a way of doing things that works for both of you.
Saving is saving, no matter how you do it. Being a big fan of I Will Teach You to Be Rich, I used to open multiple high yield savings account sub-accounts with specific names for whatever it was I was saving for. It's called targeted saving, and I thought it was a great idea.
If something unexpected happens, you take money out of the emergency fund and you still get to make your budget. It's all a psychological thing to keep you feeling like you're on track.
I showed M the system and she gave me a look: “What's the point? It's all the same amount of money either way.” She was right and I started to question how useful the whole system was. In the end, it didn't make the cut — we didn't find it useful enough for the time it took to set up. I thought it was a great idea, but M was right: it's still the same amount of money. End of discussion.
The important thing is that we were saving, regardless of how we did it.
Falling in love is good for the budget. It's called economies of shared living, and it means you'll spend less money when you split the cost with another person.
But you'll still need to set up a budget that works for the both of you.
I used to use my credit card for everything. It tracked all my spending and gave me some decent rewards. M, on the other hand, liked to have cash in hand. But I wanted to get her to budget, and my system of simply knowing how much you'd already spent (remember by daily checking of accounts?) just wasn't going to work for her.
But she felt the pressure to find a system that worked for her so we could meet our budget every month. And she did: the envelope system. She took out the money she had allotted for the week and then stopped spending if she ran out of money.
As for me, I still use my credit card like I did before. This was one thing we were able to keep individualized, which is important when you get married (we still have individual accounts outside of our joint account). With all the push to turn I into we, it's good to have your own things you can do how you want.
The important thing is that you have a budget in the first place.
Cooking together is a great idea. You get to spend time together, it's good for the budget, it's healthier, and it creates some equality in an area where traditionally it's one person doing all the cooking.
In most relationships, one person does all the cooking. Maybe you have an arrangement where the person that doesn't cook does the dishes to make up for it. That's fine — but I would recommend trying to spend a fair amount of time in the kitchen with your significant other.
It'll give you a good environment to work together towards a common goal — making a good meal. Things can get tense in the kitchen, but that's the whole point — you'll learn from it and when something more serious than overcooked lasagna happens, you'll have the tools to handle it.
Plus it's fun.
Communicate. Marriage isn't easy, especially when you're talking about money. But even if none of the other stuff I've mentioned clicks with you, then you should at least take one thing with you from this post: communication is key.
You might not track your money or save anything or cook together. But you better communicate or else your marriage is going to be a train wreck.
‘Til death. I've been married for just under two years, but I can still remember what it was like to deal with money on my own: You think you have all the answers and you treat everything the way a dictator would. You're never wrong and everyone else sucks.
Marriage has introduced democracy into my decision making and I'm grateful for it. It's made me smarter, wiser, and less of a jerk.