Who handles your family finances? Is it just one person or is it a joint effort? When it comes to the personal financial plan for a family, there are many ways to approach managing the budget. How you keep track of your family finances often depends on whether your finances are joint or separate. Some families have successful marriages with separate finances, while others share everything, including the responsibility of paying the bills. Some writers may argue for one system over another, but the important thing is to have a system in place.

Separate Family Finances

As I mentioned, some couples have a great marriage with separate finances. Growing up, my parents had joint everything. You can imagine my surprise when I heard that there were couples who kept separate savings accounts. While I am not the expert on this system (for obvious reasons), there are many ways that this works for families. Typically in these situations, both partners are employed. As far as I can imagine, having one stay at home parent would not be a recipe for financial success. With both spouses working, each keeps separate bank accounts and they split the bills. Some may split the finances equally, while others agree to pay for certain things.

While the logistics are different for each family that chooses this route, this can offer a lot of security to each partner. No matter what happens, each partner is thinking about their finances. This means that they are more likely to plan and save for retirement. If something horrible happened, each would be able to survive without too much difficulty.

Shared Family Finances

Other families, like the one I grew up in, have shared finances. All income and expenses are shared. Some families have both partners working, but it is also possible that one will stay at home to raise children and avoid daycare expenses if there are little ones running around. Sharing your finances usually requires clear communication between partners. If communication is not a priority, one partner could spend too much money.

Having joint finances often (but not always) means that one person is in charge of the finances. If they are on a budget, this person is the one who monitors spending. This has advantages and disadvantages. It is often easier for one person to manage all of the finances because there is a clear line of responsibility. The odds that a bill is left unpaid or forgotten are low. However, this also means that it takes clear communication for the one “in charge” of the finances to share the results of the budget – where they overspent, where they were under their budgeted amount, etc. Otherwise, it can lead to an unhealthy relationship. One partner may be trying to personal financial plan for the future while the other spends away all of the money. A recipe for disaster!

My Family’s Finances

Since both of our parents shared their finances, my wife and I followed suit. We have one joint bank account where our checks are deposited. From this joint account, we pay all of our monthly bills. Since I am a personal finance blogger, you may be able to guess who is responsible for keeping track of our finances. For over two years, I have been the one to create the budget and keep track of expenses. This responsibility was not forced on me, but I chose it willingly. Every month I get really excited to see how our spending matched up with our budget! Imagine the excitement a child gets when opening presents at Christmas. Yes, it’s that kind of anticipation.

As we have been setting financial goals and celebrating our financial achievements, my wife has taken an increased interest in the budget. The past two months she has helped me add up our expenses when we determine how we compared to our budget. Because we are thinking towards the future, she is now partnering with me. This is a huge change. It used to be that she could care less about sitting down and budgeting. Now, I can see the excitement in her eye when the end of the month comes.

Granted, when I told her I was writing this post, she denied her interest. She said something to the effect that she is just trying to be supportive of my interests. While it ultimately doesn’t matter too much if she takes as much interest as me in our finances, it is nice to see that she that she is excited about our finances. (No matter what she says, I know she is interested) Her interest in budgeting reminds me of the importance of celebrating your success. If you do that, I think anyone can come to love finances.

How does your family manage the family finances?

This is an article written by Corey at 20’s Finances. He writes about cutting costs, managing your finances, and saving for the future.

30 thoughts on “Family Finances

  1. One thing I completely agree with in your message, is the importance in a shared finance model for a family, is that even if one person is “in charge” of balancing the books, BOTH need to be involved in the ongoing planning and monitoring of progress towards goals. Otherwise the person holding the bag is under a huge emotional strain trying to make things work out and meet the expectations of the other.
    Much as we like to shine a light on financial successes, it is almost a given that any family will experience their share of setbacks – and that is where families really need to have trust and good communication skills.

  2. I think the most important thing is to have lots and lots of communication about finances. If you ignore it, your budget and spending will get off track quickly. In our family, we have joint accounts, hubby pays the bills and I handle most of the budget. We discuss all investments together and involve the kids in age-appropriate money conversations too.

  3. We had planned a post on this, and will likely get to writing one in time, but Corey has covered it well.

    I currently handle all of the finances. That being said, I need to do a better job keeping Mrs. SPF in the loop – I know she would like more information.

    My plan is to keep our budget worksheet and net worth tracking worksheet on our local network so she can take a look any time. Additionally, we will continue to do periodic reviews of our “state of finances”.

  4. H and I have not talked too much about how we will handle finances. I think we are going to do joint finances, but if we dont, that doesnt really bother me either. I just prefer that we both be comfortable with our choices and save money every month

  5. Beaker pretty much handed me over his checks when we moved in together. I bet he didn’t know that he was marrying a shopping addict or he would think twice. So guess who is in charge with finances in our family? Yours truly. :-) Honestly, I am managing it not too bad if not for those shopping binges. We will see what the future brings. Great post Corey!

      1. I actually asked him to write a post in December about what he really thinks about my shopping addiction and spending habits. I guess we all will find out, huh? :-)

  6. I can’t understand people who share a bed and children yet insist on separating their finances. Their priorities are a little wrong, it seems to me. But at the same time people do need their personal space in a relationship so we each have ‘pocket money’ to spend as we wish. At the moment it is a little small – and generally spent on our son anyway – but the idea is there. You do need some privacy even in the best of marriages.

  7. We have joint finances in our household. I handle most of the finances (surprise again! I am also a PF blogger), with varying participation from my husband. Fortunately like you, he’s begun to take a greater interest. He’s always proud, but has enjoyed letting me handle it.

  8. My wife has no interest whatsoever in dealing with the bills or finances. Everything is combined, but I handle it all. I try to tell her where we stand every so often. I don’t really think she cares as long as it gets done.

  9. My fiance and I have decided that we will share all of our finances when we get married, but we will each get a discretionary allowance each month that we can spend on whatever we want without informing the other person. That will also make gift giving a little nicer because gifts to one another will come out of our individual money so it won’t be like we are each buying our own present.

    I’m guessing that I will be the primary one to handle our finances, but I can’t imagine him being completely uninvolved.

    1. We are similar – we have a discretionary “allowance” as well.
      For gifts, we usually just charge them – which doesn’t show the exact item in the transaction record. Around gift giving time I just usually just gloss over statement line items that I don’t recognize unless they are outta wack.

  10. It is always interesting to hear the different backgrounds people come from. I, like you SPF, had parents who had joint everything. They still do. My hubby on the other hand has parents who have separate accounts. When we got married we kept separate accounts but we gave each other access to each other’s accounts as a safeguard if an emergency happened like a car accident and someone ends up in hospital. Basically we were getting ahead of the power of attorney thing if something bad happened. It seems to work well because it is a mix for both. However, we track every account and transaction in Quicken in the same file so buying surprises for each other is a bit more difficult. Even if we don’t look at each other’s accounts the transaction still shows up in the budget.

  11. I come from a background where it was not only a shared account but the cash was known to all; I was seven years old when I bought myself a violin with the food money (my Dad only took some more out and started paying for music lessons). We have shared account; and I look after the day to day budgetting but decisions are taken together.

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  13. I manage the finances in the house, but Mrs. 101 has substantial input, and also manages the charitable contributions. We have periodic review and planning sessions around the kitchen table, when I get the opportunity to trot out my fancy spreadsheets and bore her to tears.

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