If you’re in a serious relationship and living with your partner you might think it makes sense to get a joint account and pool all your money. But – unromantic as it sounds – it might be better to think before you leap.
You need to think about not just your attitude to money, but also your partner’s. And though all is hopefully going well now, what would happen if things changed?
These are just two of our 14 questions to think about as a couple before you jump in and combine all your finances. Take a look and see if you could make changes to how you and your partner manage your money.
Your relationship with money
1. How different are your attitudes to money?
Is one of you a spender and the other a saver? If you’re at odds it could cause friction, especially if one person often overspends or struggles with budgeting.
2. Do you talk about money?
Communication about money is key for any couple, particularly if one of you looks after more of the finances than the other. Though it can be a taboo subject you’ll need to be open about your spending and saving, now and in the past.
3. Do you want to combine all your finances?
Though it can seem a natural step when you move in together, you might want to just combine joint expenses like bills, rent, groceries and things like a holiday or car.
This way you can keep money separate for any personal spending.
4. How will you divide existing savings and expenses?
Does one of you earn a lot more than the other? What about existing savings or property? You might not want to split things evenly, or you might decide 50/50 is the fairest way.
5. Does one of you have a poor credit history?
When you get a joint bank account or take out a loan or mortgage together, your credit file becomes linked. This means if your partner has a poor rating it can damage yours too.
6. Are you receiving benefits?
Universal Credit will replace many of the existing benefits and tax credits in one monthly, household payment. If you don’t have a joint account you will need to choose who gets the money.
Managing your money
7. Who will manage joint finances?
The ideal is that you share responsibility, or split different bills and expenses between you.
However, you might find one person naturally takes the lead. If this is the case it’s important to keep the other person informed of what’s going on. They should be able to get access to bank and bill accounts whenever they want.
8. How will you keep track of spending?
If you’re both spending from the same account it can be harder to keep track. A household budget is a really useful way to see where joint money is going each month. Plus, if you have a smart phone you can use banking apps to check your joint bank balance each day.
9. What things will you pay for jointly?
Though some things make sense to pay for together, you might not feel it’s fair to split the cost of new clothes or evenings out. Agree up front what you’re paying for together and what you’re not.
10. How will you manage your spending?
It’s worth setting joint spending limits to ensure one of you doesn’t overspend. You should also talk about changes to regular payments.
If you’re paying for your own things separately, will you share your bank balance with your partner?
11. How much will you pay into your joint account?
Will you pay your full salaries in every month? Or will you decide how much each pays in and transfer that amount from your personal account?
12. Will you be saving together too?
If you’re planning on saving together, you can put in safeguards, for example both of you have to sign to withdraw any money.
Changes to your relationship
13. What happens if one of you stops working?
It could be you decide to stop working to look after children, or you might be unable to work due to ill health. Whatever the reason, decide up front how this could affect your finances. Will the earner provide an ‘allowance’ from their income, or will you just split from a joint pool of money?
14. What would happen if you broke up?
Though this hopefully won’t happen, would you be protected if you split with your partner? It’s important to have a pot of separate savings if you can, and know what happens to things like property and joint savings.