by Virginia Sole-Smith, REDBOOK
Postnups, financial three-ways, paying your spouse for doing laundry…. More and more couples are devising their own, sometimes wacky money systems. How does yours compare?Nothing makes me feel more overtly "married" than when I open up my wallet to pay at Home Depot and pull out the shiny blue debit card labeled, in big block type, SHARED. My husband, Dan, broke out the label maker two months after we got married to distinguish the cards linked to our joint account from the identical blue debit cards we use for our separate personal checking accounts. (And in the rush of newlywed excitement, it didn't occur to him to use a more discreet font size.)
Related: Easy Tricks for Sexy Summer HairWe've decided not to pool all of our money the way our parents did. Instead, we subscribe to what Manisha Thakor, founder of the Women's Financial Literacy Initiative, dubs "The Financial Three-Way: Yours, Mine, and Ours." For Dan and me, the logistics work like this: We deposit our paychecks into a shared checking account for joint expenses like the mortgage, groceries, and date nights - then transfer an identical amount of money into each of our individual accounts to use however we please. (Mine goes to pedicures, dinners with my girlfriends, and last month, a speeding ticket. Oops.) The system works because we earn roughly the same amount, but when my income dipped last year, I took a little less "fun money" to keep things feeling fair.
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This plan would've been hard to pull off in a world before online banking (or label makers), but technology isn't the only reason couples are reinventing the traditional "one pot" approach to marital finances. As people marry later - the average age has drifted from 20 in 1950 to 26 in 2010, for women - we tend to arrive in marriage-land with separate financial identities that can be tricky to merge. And since 44 percent of people now move in together before marriage, many maintain their status as financial roommates even after getting hitched. In fact, one fifth of women in a recent REDBOOK poll said they keep their money totally separate from their partners, and nearly half have some cash stashed in an account only they can touch.
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Yet even top financial experts can't agree on how to hammer out the details. Money maven Suze Orman would approve of my three-way approach: She advises newlyweds to open a shared bank account and credit card to manage the household stuff, but also to have separate accounts so each partner maintains a degree of financial independence. But Washington Post personal financial columnist Michelle Singletary has advocated for the "one pot" plan, calling separate finances the "selfish way to go in marriage."
Clearly, the real experts are you and your partner, and it's critical to find an arrangement that suits your exact situation, as pairs who bicker over bills once a week or more are 30 percent more likely to get divorced than those who squabble about it less, according to research from Utah State University.
Need a new system of your own? One of these couples' wildly different setups may work for you.
Lisa Gee-Gray, 35, and Anthony Gray, 39, Marana, AZ
They focus on paying down debt, together
THEIR MONEY SYSTEM: Lisa and Anthony pay all of their bills - including household expenses, contributions to their four kids' college funds, and credit card and student loan payments - from a joint account. Then they each get $150 a month transferred to their personal accounts to spend however they please.
WHY IT WORKS: "We're finally working as a team and have paid off $18,000 of our debt in the last six months!" says Lisa. It's a big change from when they first got married. Back then, Lisa and Anthony, both engineers, agreed they would each be responsible for paying off their own student loans or any credit card debt - so they put less money in the joint pot and kept a bigger share of their income in their individual accounts. But instead of paying down their credit balances, they both continued to charge things they wanted, and each secretly racked up more debt! They'd have intense fights - often ending in tears - when money got tight. Last fall, Anthony learned that Lisa had $8,000 in credit card debt, and she was shocked to see he was still $12,000 in the red. Now they've stopped using their personal credit cards, have instituted monthly money dates to discuss upcoming expenses, and have put retirement savings on hold until they're debt-free. "So far our plan is working. We want to have everything, with the exception of our mortgage, paid off in three years," Lisa says.
Read the rest of The New Money Rules for Couples
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Reprinted with permission of Hearst Communications, Inc.