Happily Ever After? 5 Things to Consider when Combining Finances (part 2)
Sharing is important in a functional partnership. It’s also a very sensitive subject, especially where money is concerned. Combining finances is nothing to jump into, and how you go about it (or don’t) depends on your situation.
Here are five things to consider when this topic comes up.
Is there good reason?
Working closely with another may seem like a good enough reason to combine finances, but it shouldn’t be the only reason. Be sure that it isn’t a one-sided decision, and that both parties feel it will be beneficial. After all, this decision will lead to your partner having access to your finances, for better or worse.
Do you know where you stand financially?
You will, understandably, want to know what your partner’s financial situation is before you leap into the decision of combining finances. In turn, you should know where you’re at. Each party needs to be prepared to present their financial records as an open book. Is one of you drowning in debt while the other has racked up substantial savings? These factors could heavily influence your decision.
Are you compatible?
If you’re one that cringes with the slightest drop in your bank account, perhaps you may not mesh well with your partner that loves to spend money. It’s important to know if you will be able to come to an agreement on a budget that works for both parties.
Should you combine your accounts?
It’s very likely that both you and your partner will have your own bank accounts and credit cards. Combining them may seem like a logical move. The appeal is not having to worry about divvying up bills and the easy viewing of account transactions by both parties. If you’re not ready to place that kind of trust in another, you can consider keeping individual accounts on top of a joint account, or opting out of it altogether.
How will you divide the responsibilities?
Who will pay what bill? How will you track your budget and your expenses, if you choose to do so?
It may seem a bit overwhelming when making the decision to combine finances, but it isn’t irreversible. If you do decide to take the plunge, evaluate the situation regularly to decide if it’s working.