Give Me Back My Five Bucks

Combining our finances

I’ve always kept my finances separate from my significant other. This was in part because my past relationships just never got to the point where we needed (or wanted) to combine our money, but it also has to do with the fact that over the last 10 years, I’ve become fiercely independent when it comes to my finances.

Ten years ago, I was in a lot of debt. It was stressful and gave me a feeling of hopelessness – that I’d never be able to fend for myself because I was too much of a disaster – especially when I hit rock bottom and realized that I had to rely on someone else (my boyfriend at the time) to help me with bus fare. BUS FARE. I didn’t have money (in cash or credit) to get to work. I cringe just thinking about how horrible that was.

Related: Would you ever date someone who had debt?

When I eventually started paying attention to my money, I promised myself that I’d never be back in that situation again. I worked hard at my finances, saved up enough money for a down payment on a townhouse, and built up a modest retirement portfolio. I also wanted to be seen as an equal financial contributor in every relationship I’ve been in, so I always insisted on paying for my fair share of everything, even if I made significantly less money than the person I was dating. I didn’t want to be seen as someone that a man has to take care of financially.

This mindset has had both positive and negative consequences, as you can imagine. The pros mostly stemmed from my own personal satisfaction that I’ve gotten to a stable place financially. It made me feel empowered! But some of the cons were that I never really considered someone as a long-term partner unless we were on somewhat similar financial terms, and I still have a hard time letting someone treat me to something as simple as dinner – I always have to make sure that I take care of the bill next time. So that it’s fair.

Related: Splitting expenses with your significant other

Earlier this week, RD and I got pre-approved for a mortgage (!). We aren’t actively looking, but we wanted to be ready just in case something amazing comes up. But one of the items that our mortgage broker wanted was a void cheque from the account we wanted our mortgage payments to come out of. So all of a sudden, this kindafar-into-the-future-conversation of combining at least a portion of our finances was something we had to talk about now.

When we first moved in together, we were keeping track of our shared expenses and totaling them up at the end of the month. Then to make up the difference, an e-transfer would be made to the person who spent the most. It was a bit of a clumsy system because it meant we were each combing through a months’ worth of expenses to try and remember what was shared and what was personal. So for the past 3 or 4 months we’ve been using a joint (travel rewards) credit card. That has really helped because I just total up the expenses at the end of the month, and RD sends over his portion of the rent plus his half of the monthly expenses.

Over the past few months, we’ve gotten good at figuring out what expenses are shared and what are personal, so the next step is opening up a joint chequing account (which we did yesterday through Tangerine!) and linking our existing individual chequing accounts to it. We’ll still keep our own accounts because we both agree that maintaining financial independence is important, and will just transfer in a TBD amount of money into the shared account every time we get paid. :)

Related: Would you use a coupon on the first date?

It’s both scary and exciting to incorporate shared finances into our relationship, and I imagine some tweaking to our system will happen along the way. For readers who also incorporate some sort of shared finances with their significant other, did you have any hiccups and modifications to make when you first started out?

Author: Krystal Yee

I’m a personal finance blogger and marketing professional based in Vancouver. I’m a former Toronto Star (Moneyville) columnist, author of The Beginner’s Guide to Saving and Investing, and co-founder of the Canadian Personal Finance Conference. When I’m not working, you can usually find me running, climbing, playing field hockey, or plotting my next adventure.


Comments

  1. My husband and I just got married, but we lived together and shared expenses before with separate finances. Now that we are joining our finances, we’ve found it both rewarding and challenging! He is more of a spender than me so I can be naggy about how much he spends. We decided to both keep a small separate account to spend with no judgment. It saves our budget and prevents us from driving each other crazy. Great post and best of luck!

  2. Tara says:

    congrats on the pre-approval! I would be sure and use a lawyer draw up a contract, however, before buying, especially since you’re not legally married. Better to have everything in an agreement before purchase, that way everything is binding in case things go south (hopefully nothing goes south!). Sounds pessimistic, but it’s better to be safe.

  3. Chelsea says:

    Our situation is quite similar. My husband and I have a joint savings account that joint expenses come out of and a shared credit card for household/joint expenses. Then we keep our chequing accounts separate and have our own credit cards as well. It works for us. We’re building our future and sharing our life but still have independence.

  4. Leigh says:

    The joint credit card is so key once you’re comfortable with it. I bought the place we live in before we started dating, so we had pretty minimal expenses to split at first since I kept paying for it entirely on my own until a few months after we got married. We split expenses by me paying for all of the housing and him paying for mostly everything else. This took some tracking to make sure we each felt it was fair though and so all of the variable costs my now-husband paid for went on one credit card that wasn’t used for anything else and I had an authorized user card on it. This made it easy to track. We estimated our spending categories and ended up picking one that gave good rewards on groceries since it is one of our highest categories.

    In our transition time between getting married and getting our postnuptial agreement signed, my husband and I had two credit cards that we just monthly split the balance on (a travel one and the groceries one) while I continued to pay for the housing. Now, we have a joint checking account into which we each deposit a fixed $ amount each month and I pay the condo fees, property taxes, and joint credit cards out of it. It’s taken time to evolve to this point though (almost four years!) and we’ve definitely switched up our systems over the years as we found something that worked better or if something didn’t feel right.

    The CC has to be done once you’ve established financial trust though because that card is on my credit report!

  5. Jennifer says:

    We’re just figuring this out now. Tangerine has been challenging to get a joint account set up. How did you do it?

    I read some reviews online of people being frustrated with how long they hold deposits, what has your experience been with your personal account? I only have TFSAs at Tangerine so far.

    And I hear you on the ‘not wanting to rely on a man to provide for me” front. I have a great job, but my partner is a software engineer so I cannot compete with the salary, at least for the next few years. We’re moving from 50/50 to proportional after a few years living together and sharing expenses. We think of it as socialism rather than conforming to traditional roles – Disbursing the wealth around the family. Any our circumstances could reverse in the next 10 years or so, so it gives us that flexibility.

    • Krystal Yee says:

      Yeah I was surprised that it was so complicated to set up a joint account with Tangerine, as everything else with them is so easy! The only way for me to initiate a joint account as a current Tangerine customer was to convert my existing (single) chequing account into a joint account. Then once that was established, I could go and open up a separate (single) chequing account for myself. That seemed dumb. So thankfully RD wasn’t a client of Tangerine yet. He was able to open up a Tangerine chequing account online, then he called in to have it converted immediately over to a joint account.

      I’ve never had a problem with hold deposits with Tangerine before. I spoke with a customer service rep a few years ago who said that every once a while you can call in to get the available limit raised for how much of your deposit you can access before it clears. I believe that is based on your history with Tangerine as well as your credit score, but that could be wrong. I do know for sure it’s possible to get that hold limit raised though.

      Also I totally agree with you about moving over to a proportionate system. It makes more sense, and it’s probably what I would want too if the gap in our salary was wider than it currently is.

  6. Tawcan says:

    Congrats on the pre-approval and taking the next step. I think combining finances make a lot of sense. Makes life a lot easier IMO. That’s something we did when we moved in together.

  7. Anonymous says:

    We started with a joint credit card too, and that makes everything pretty easy.

    Later, we added joint savings/investments. We actually still do not have a joint checking account, but that is mostly because neither of us uses our checking accounts for anything other than general cashflow, and there never seemed to be a real need. It would make more sense to make one joint and close the other, but… we are lazy.

    Retirement accounts are in our own names (no other option), but are thought of as joint. In the unlikely case of a divorce, California law considers contributions and earnings during marriage as joint. Of course the house, mortgage and car are in both of our names.

    Early in our relationship, we split rent in a mutually agreed upon split (based on ensuring we both benefited about equally from moving in together vs what each of us were paying before), then split everything else 50/50. It’s easier just to have one bill that isn’t 50/50.

    Now, we don’t split things 50/50 or proportionally, we just consider all money as joint earnings, and it really doesn’t matter whose account pays which bill. We don’t do allowances, but generally buy what we want for ourselves. Large purchases are discussed organically, but it wouldn’t be a big deal if not. We’re both relatively frugal, so this works out for us.

  8. Dan Kent says:

    Great post! You sound just like my girlfriend. Somewhat stubborn in the fact that she wants everything to be equal, even though my income far exceeds hers. But I appreciate it, and she knows that. We have been dating for almost 5 years, we still have separate finances and also live with each other. I cover the mortgage, but she chips in on many other things that makes it almost equal! It’s a good feeling having unity in this type of situation.

  9. Fern says:

    I’m not but I don’t see why it’s exciting that you were pre-approved for a mortgage. Anyone can get pre-approved for some sort of loan nowadays – I would have thought you would be excited to not have to take out loans again.

    And I don’t understand the message of this blog anymore. You keep flip flopping between owning and renting which is. It financially sound. Didn’t you recently say that renting is such a good deal? Not to sound too harsh, but this has become less of a finance blog and more of blog where you share with us what is going on in your life.

    • Krystal Yee says:

      Hi Fern – thanks for your comment. There have certainly been traditional “financial” articles on this blog throughout the years, but more often than not it’s just been about me and the decisions that I make regarding money.

      As for owning and renting – I really want to stress on this blog that renting is a lifestyle choice and not something done just because a person cannot afford to buy property. That’s why I’m very pro-renting, and I always will be. Both are great options. Owning a home is realistic if you plan on staying where you are for a long period of time, and your total monthly costs (mortgage, strata, property tax) add up to what rent would be. The issue is that for most people in hot markets, that’s just not the case. And there’s no sense stretching yourself thin just to own something. So you’re right, I do flip flop, but only in the sense that I don’t think one option is better than the other, it’ just depends on so many different things.

  10. jill says:

    I prefer when your blog gets more personal, personally! I wish I was in your position financially, hopefully I get there soon.

    I do miss the fact that you used to blog more frequently, BUT a lot of the bloggers I follow don’t blog as much – because their lives have undergone big changes. So I just follow you all on Twitter and Instagram :)

  11. Song says:

    My husband and I don’t have joint accounts but we have joint credit card and access to each other’s bank accounts. I typically pay for the mortgage and charges to one of the cards, and he covers the rest. If one of us didn’t have enough money in the bank to pay for the card, the other covers.

    I think in the end it’s really just a mindset. Whether we own a joint account or not doesn’t really make a difference as mentally we both think of our assets as “ours” not “his” or “hers”.

    We do each own a “monthly allowance budget”, in which we can spend on personal items that we want to buy without the other person questioning :)

  12. Jen says:

    My husband and I have always been all-in, basically from the start of our relationship, everything is either joint or jointly accessible.

    However, we share a lot of financial values/long term goals so money is not usually a point of conflict (debate sometimes, when we are evaluating pros and cons, but it’s never an issue of “why would you spend money on that”). I think respecting the other person’s judgment and wanting them to be happy underlies us not fighting about expenses or budgets.

    One thing we do is play to our individual skill sets and interests. My domain is day-to-day expense management, financing options and tax optimization. His domain is scouting certain kinds of investments (he has an education background that helps in a specific area that is relatively unique), managing some foreign diversification options and researching larger purchases.

    I understand, in theory, people who have separate finances (or where one person “runs” the finances) but I actually can’t imagine it in practice. I love being part of a team and celebrating our successes/carrying our challenges together.

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