Peter, 27, and Deborah, 25, are soon-to-be couples whose wedding comes up in a month’s time.
Peter, a mid-level staff at the Lagos State Ministry of Justice, earns N120, 000 per month. Deborah, on the other hand, works with Heritage Bank as a customer service officer, and she is placed on a monthly pay of N80, 000.
The love birds have discussed how they want their new home to be, but they are yet to reach a consensus as regards their income will be managed.
Of course, it is somehow difficult to share one’s money with another person when one has spent most of his/her life managing it personally.
Managing finance as couples could also be tiresome especially if both parties lack similar financial mindset.
There are various methods couples can adopt to manage their finance but the fact remains none suits every couple across the globe.
Figuring out the best way to manage money as a couple takes a lot of discussions but as your relationship grows and changes, the way you handle money will grow and change too.
Here are some options intending couples may utilize to manage their finances while giving reasons why each option works.
One joint & separate account
The couple combines all accounts but each person has a separate account. A sum is transferred from their joint account into personal accounts every month.
The idea is that money can be spent guilt-free and there is no need to consult the other party. When one person wants to spend money but does not want to discuss the expense with the other party, they can use the money in their separate account to pay for it.
The hardest part of this method is deciding how much each person should transfer to the joint account.
Why it works: Having one separate account helps maintain a sense of independence while still working toward common financial goals. With this method, each party can spend within their means and they need to get worried about how it affects the other party.
One pooled account
The couple has one joint account and uses it for shared expenses such as food bill, rent and miscellaneous. A couple can either contribute an equal amount or different percentages to the joint account.
If both parties earn an equal amount or have similar taste, they may contribute the same amount to the joint account.
On the other hand, if one person earns significantly more or has higher tastes than the other party, they may want to consider contributing different percentages rather splitting the expenses equally.
For instance, if the family expense is N50, 000, Peter, with N120, 000 monthly payment is expected to contribute N30, 000, and picking up the remaining N20, 000. Each time a joint account needs to be paid, it is paid directly from the joint account.
Why it works: This approach helps couples plan what to spend each month. It creates a sense of financial solidarity. Some couples feel a greater sense of trust when all of the finances are combined into one account.
Live off one
This technique is more effective when a couple focuses on saving together for shared goals such as house projects and is able to live off one salary. This approach makes saving easy and also gives the couple succor that is able to make ends meet with only one income.
Why it works: This approach makes saving easy especially if the couples are on the same page with spending and saving. This eliminates the work needed to ensure that enough is set aside each month to meet financial goals.
Completely separate
When a couple moves in together or gets married and decides to keep things separate, they allow certain bills to themselves. For example, one person may pay the rent while the other person pays food bills and utilities. No accounts are combined and each person maintains complete control of their personal money.
Why it works: This is a good option for couples that are panicky about sharing finances for the first time or who do not want to share control of their money just yet.
Totally combined
This approach creates a sense of total transparency. All accounts are combined and each person actively decides how funds are spent and saved. Here, both parties are responsible for planning for a joint financial future.
When finances are totally combined, each person needs to be really honest about how they want to spend and save for the future.
Why it works: This approach makes it easy for couples to work towards shared financial goals especially if they have a similar mindset about money should be managed. This method also provides absolute transparency about how money is being spent.
