Decision Points: Should I Combine Finances with my New Spouse?


Whether separate or combined, the right choice depends on you and your spouse, and the first step is open communication. To help you kick off the discussion, here is a guide to choosing between combined and separate finances:

Pros of Combined Finances 

As soon as you marry, your finances will already be combined, explains Karen Lee, author of It’s Just Money, So Why Does It Cause So Many Problems? “Whether you open a joint account or not,” explains Lee, “your finances are already combined in ways you might not know.” For example, one spouse’s credit card debt could affect the other’s ability to apply for a mortgage. On a positive note, when you crunch the numbers, combining may make financial sense. Higher savings and investment balances lead to higher returns, and filing your taxes together might produce better tax benefits. This combined financial power can contribute to a sense of solidarity, as you begin to think of spending as a unit. Saving together allows you to start working together toward mutual goals, such as buying a home, traveling or purchasing a car. Combining is a great way to prepare for a rainy day with both of you in mind. In the event of an emergency that affects one spouse, you will both have access to the funds.

Cons of Combined Finances 

Combining your finances requires a great deal of trust, as your spouse’s actions have great bearing on your fiscal wellbeing.

For example, a joint credit card will bear upon both of your credit scores. With so much at stake, the sense of solidarity required in a marriage may actually be damaged by combined finances. Money management is incredibly personal, and spouses may have conflicting beliefs about how much should be spent. If hard times hit, spouses may begin to blame one another for their financial dilemmas as a couple. The responsibility for handling finances may also be unbalanced when one person handles all of the finances. Combining your finances responsibly will take a great deal of work and compromise from both spouses.

Pros of Separate Finances 

Separate finances might make personal gifts or dates more special, as the treats come from your own individual fund. Finances are the number one spark for marital discontent and conflict, according to a report by American Express. Separating your finances may allow you greater independence when it comes to spending. Individual financial lives also allows you to keep your credit histories separate. As long as you are fulfilling your responsibilities within your marriage, you have full discretion over your own funds. This personal control is particularly important if you have irreconcilable spending and saving styles. You may have fewer arguments about your spouse’s spending habits.

Cons of Separate Finances 

Maintaining separate accounts could mean that you are paying unnecessary additional  fees at banks and on credit cards. You may also have difficulty figuring out how to share expenses equitably, particularly if you have children.

Should you and your spouse have different incomes, splitting costs right down the middle can be problematic. At first glance, separate finances appear to prevent fights about money. However, financial strain on you or your spouse will still affect the quality of your marriage, regardless of your separate bank accounts. Indeed, even if you divorce, you may still find yourself liable for your spouse’s debts. Separate finances might even distance you from your partner too much, if it prevents you from recognizing when he or she is in financial trouble.