Sunday, November 04, 2018

Marriage Advice: Finances

I'm probably not the best person to give marriage advice. I'm not a psychologist or marriage counselor, and I've only been married for seven years and we don't have kids. This article got me thinking about marriage, though,and in particular what advice the church can give about marriage. I think that a sermon series on marriage and relationships could be very useful, but in my experience, churches are terrible at giving practical advice. They tend to over-spiritualize every question, falling into deep theological wells about complementarism and egalitarianism rather than giving practical advice. So here I thought I'd give practical advice on a frequent source of conflict in marriage: finances. And to that end, I'll tell you what works for me and my wife.

The first rule of advice is that works for one couple may not work for others. Talk things over with your spouse and decide how you want to do things. Make sure you agree.

I'm not giving advice about how to balance your budget or pay your bills. If you can do that when you're single, you can do it once you're married. I'm focusing on a much more contentious question: how do you share?

Many couples share everything: what's yours is mine and what's mine is yours.  Every penny we make goes into a joint account, and every penny we spend comes out of it. Which is great, as long as you agree on every single expense. Often you will not. Sometimes my wife wants a fancy dinner, and I want an Xbox--and they cost the same amount. To me that sounds like an extravagant waste, while my wife thinks something similar about the Xbox. She'd never use it, and how often would I really use it after the first month? What often happens is that each person feels the other is being wasteful with their money. It's not uncommon for one partner, usually the one who makes the most money, to start putting restrictions on the other. No, you can't buy that, we can't afford it when we need groceries.

Another option is to keep separate accounts. My paycheck goes into my account, your paycheck goes into yours. Everyone has their own stuff: their own car, their own Xbox, their own meals. Joint costs are split, more or less evenly. That can also work, but what happens when one of you makes a lot more than the other? What if she can't afford to pay half the rent on the nice place close to his job, and starts to resent that he's driving a Mercedes while her clunker is giving its death rattle. What if he loses that job and his savings start to run low because he spent it all on the fancy car? Sure, she'll cover him for a few months, but how long until she starts to resent that he's living off her money.

Now it's not impossible to make either of those work, given common levels of frugality or income, but I'd like to propose another way, and it's the one my wife and I use.  All income goes into into a joint account, from which all household expenses are paid, plus each of you get a personal account. Each person gets a certain amount in their personal account each month, and can spend it however they want. The amount can be fixed, or a percentage of each paycheck.  My wife and I tend to each get 5-10%, depending on what we feel we can afford at the time.

It's important that each person gets the same amount, no matter who's making more money. This helps to avoid feeling that that it's my income or your income. It's our income, and our money, we simply designate a certain amount for each individual's personal use.

Joint expenses are just that, joint. You have to agree on joint expenses. Most are easy: rent or mortgage, bills, groceries, kids.  But if it's ambivalent, or it's expensive (we set a threshold of $200) and not something you've already agreed to, such as groceries or the mortgage, then you have to decide on it together. If you agree, great. But if not, that's not a no. It simply means you have to save up before you can pay for it from your personal account.

Modern finances being what they are, you'll also need a joint credit card and personal credit cards. Personal credit cards are paid off from the personal account, and the joint card is paid off from the joint account.

We've found this arrangement to work very well. The lion's share of our income goes to the joint account, and we spend it on necessities, or things we both enjoy, and save when we can. But we each have a fund we can draw on for things we want, without the need to worry about what the other person would think. It's also the fund we use for date nights and gifts for each other--it's more meaningful when it's our own money.

Speaking of date night, at this point of our relationship we switch off, alternating who pays for the date out of their personal account. That person also gets to plan the date. That way they get to decide how expensive it is, as long as they're willing to pay for it, and they can also pick the activity. Often it's not something the other person would have picked on their own. We typically don't drag each other to activities we know the other person will hate, but we also try to be a good sport about trying things.

So that's what works for us. It won't necessarily work for everyone. And when money's tight, what is and isn't charged to the joint account may be a point of contention, and you may need to budget even the stuff you agree on carefully. For example, is there a limit to how much you can spend on groceries from the joint account? How about clothes or toys for the kids?

But even then, it's nice to have a little money you can spend for yourself.