Do you stress about money? Does it cause conflict for you as a couple?

After working with individuals and couples for over 30 years and going through a divorce, being a single parent, and re-marriage myself, I have learned that “love makes the world go around, but money greases the wheel”. What does this mean? It means that the most important priority in our lives should be our relationships, but in order to live, we must have money. The more money we have, the easier life should be and the more we can enjoy our relationships.

Why does money cause us so much stress or conflict?

It causes us stress because we must have it in order to live and wages do not always align with the cost of living. Also, some of us were never taught how to handle money, especially on a budget. Most parents hide “money problems” from their children in order to protect them. I am not sure what they are protecting them from…except the reality of money. Who else will they learn money management and its value from? They can go out and seek training on their own.

Then you combine knowledge or lack of it, wants, needs, and desires to determine how a person will manage their money. As a couple, you take that and multiply it by two, especially if they focus on their own individual wants and desires over the needs of the family.

3 Ways to Handle Money Having a Savings and a Checking Accounts with Allowances

Here is the meat of your post. You’ll break down the problem into a list of easy-to-accomplish steps to help your reader.

1. Deposits Going into Joint Savings

Deposit all money into a joint interest-bearing checking account (savings). Withdraw enough to cover bills, living expenses, and allowances for that period and deposit it into a joint checking account.

Let the debts be auto-drafted from your savings. Then as you get items paid off you won’t realize that you have extra money to spend.

2. Deposits Going into Individual Accounts

When trust is an issue for a couple or if you’re not married, have the monies deposited separately into individual accounts and then deposit a set percentage into a joint checking account. This keeps your funds separate so that you can pay your individual debts or expenses. Usually, no allowances are given in this circumstance unless the individual wants to give himself/herself one from their own account, which is up to them.

What is deposited into the joint account is based upon each person’s earnings to cover all joint debts and expenses.

Example: If the total take-home income is usually $2,000 per month: He brings home $1,500 and she brings $500. Therefore he pays 75% and she pays 25% of the joint bills and debts, to be deposited into the joint account. In other words, for $1500 of bills and debts, the deposits would be $1,125 from him and $375 from her. Whatever is left in the accounts belongs to that individual to pay personal debts (like a personal credit card, college loans, and individual’s auto loan) and to do with whatever he/she wants.

3. Deposits Going into Joint Checking Account

Put all of the monies into the joint checking account and pay all expenses and debts out of this account and then the balance that is left over is deposited into a joint savings account. The problem with this method is that people usually spend what is available, so many times there is none left for savings.

With Allowances

Withdraw allowances as cash for each person per week to spend or save how he/she wants. This cash should cover personal expenses such as eating out, drinks, and other miscellaneous items. You can even include fuel. It is whatever you decide. It depends upon how good of a money manager that person is. This will also determine if each of you has a debit card available.

One way we have done it for spending money is to set up a Greenlight account with each person having a card. It can be set up to limit some of the money to be only spent on fuel. The other advantage is that if someone really needs some money for an emergency, the administrator of the account can make a transfer from the bank account to the Greenlight account to that person’s card so they’d have money immediately.

Planning and Compromise Are the Keys to Reducing Stress and Conflict About Finances

Decide how you feel comfortable with handling your money before you choose a method. You know yourself better than anyone else would. Be honest with yourself. Then if you have a partner, let them decide what they would be more comfortable with and compromise on the method you will use. But as in all decisions, honesty is important.

Compromise is just that. If you do not agree on which method to use, then try one for at least 2 months and then try another to see which works best for you both. Remember, these are only guidelines. The most important point of this article is for you to start using a plan that is successful for you.

For Those Who Believe:  No servant can serve two masters.  Either he will hate the one and love the other or be attentive to the one and despise the other.  You cannot give yourself to God and money. (Luke 16:13 NAB)