Who manages the money in your household?
I received an email not too long ago asking if I could write a blog post about how RD and I manage our household finances. As you may know, we keep our personal savings and retirement account separate and I’ll never blog about RD’s personal finances (so this post is really an incomplete picture of our overall financial management), but we do have joint accounts for managing our everyday spending. And that I can talk about. :)
Just a few notes about us if you’re new to this blog:
- We are in our mid-30’s with no debt other than our mortgage
- We make roughly the same amount of money
- This is obviously just what works for us, and is not necessarily going to work for every couple.
Before we combined our finances
When RD and I first moved in together, we kept our finances separate for the most part. RD would write out our monthly rent cheques, and we would put all of our joint expenses (groceries, household, travel, etc.) onto my credit card because of the rewards points. Then, at the end of every month, we’d reconcile all of our transactions, and one of us would transfer money to the other person depending on how the expenses came out that month. I liked it this way because I had a record of all of our everyday purchases so that I knew exactly how much we were spending. And RD liked this method because he wasn’t super interested in any of that information. :)
We kept our finances like this for the first 18 months we lived together. It was an easy system to work with, and also it gave us a sense of financial protection should our relationship not work out. Not that we were planning for the worst, but we both felt strongly about maintaining a level of financial independence, especially in a new relationship.
Related: We are home owners!
Creating our budget
When we decided to buy a condo together, that’s when we decided to open up a joint account for our shared expenses. I wanted to have a set amount of money that we deposited into this account bi-weekly – that would cover our mortgage, maintenance fees, property tax, insurance, groceries, household expenses, as well as a decent amount of buffer money that would also act as our joint household savings account. And because we had 18 months worth of data to draw from, I did what I do best, and created a spreadsheet. Ok, multiple spreadsheets. :) I averaged the last 18 months of our joint expenses, probable mortgage and housing costs, included a buffer, and came up with a magic number that we would each auto deposit into our joint account on payday.
Related: Why I don’t want to burn my mortgage
In the last 6 months, we’ve adjusted our magic number once – by just $20 – because our condo maintenance fees increased after our AGM, and we have another mouth to feed ever since we adopted our beautiful cat Zoey from the SPCA. :)
Who manages the money?
Me. This actually works out perfectly because you know I love budgeting and spreadsheets and numbers. Nothing makes me happier than burying my nose into a good spreadsheet or reconciling purchases and paying bills. It’s not because RD isn’t good at this type of stuff (he’s never had debt and he always pays his bills on time), but I like taking a more in depth look at our money. It was actually a huge step out of his comfort zone having me take on his part of our joint finances, and I appreciate that.
I also tend to take on any paperwork regarding our joint finances and negotiating any bills that need to be negotiated (like our internet), but only because I have a more traditional desk job and access to a phone on a more regular basis.
We do make sure to check in regularly with our finances, and he has access to our joint accounts so that he can see our balances and transactions whenever he wants.
Who spends the money?
Me, mostly. :) We have that joint credit card that he puts gas onto or if he buys anything for the home, but I do almost all of our joint household shopping for groceries, cleaning supplies, toiletries, pet stuff, etc. This falls into our division of chores, because I like shopping and comparing prices and products. I also feel a sense of satisfaction in having our pantry and linen closet stocked with essentials. I also pay our credit card balance every month, and any other random bills that might come in, but most of our household bills are automatically deducted from our joint account.
I’m curious – who manages and/or spends the money in your relationship, you or your partner?
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.