Combining Bank Accounts: How to Budget, Save, and Prevent Financial Fights
One of the biggest challenges in a new marriage is the joining of finances and navigating how and when to spend your money. Many people choose not to combine their checking accounts to avoid any fights over spending. But, Allyn and I are old fashioned and decided to share everything. If you plan on or have already combined incomes with someone else, here are our tried and true secrets to making it work. And while we still have our arguments, they are fewer and farther in between. I'm not saying this method is perfect, I'm just saying it has worked for us.
A quick background of where we were before we made these guidelines: We met when I was 19 years old. I was still in college and only working part time. While I paid for my car/gas, apartment, and social life, I had help with groceries, bills and tuition. I grew up having a concept of money (had a job since I was 15) but never truly felt the strain of doing it all on my own. As soon as I graduated and left the arms of my parents, I had Allyn and his income to survive. This lack of monetary independence caused Allyn and I to disagree on how and when to spend our money. I was carefree and not stressed when it came to finances. I knew I had him as a safety net and since he made more money anyway, I never felt the strain to worry about bills. Since I thought everything would figure itself out, I wanted to go out to bars and dinner often, go shopping, and buy whatever looked good at the grocery store no matter the price. I wanted to spend without limitation because I wasn't worried about how the bills would get paid. I didn't quite grasp the concepts of setting future goals, budgeting and saving. It took many discussions and years of learning to work harder to realize the importance. Luckily, we are on the other side of that struggle. Heres how we got there.
1. Log your expenses: For a few months I wrote down everything I spent; gas, take out food, groceries, clothes, you name it. I wanted to see where my money was going and how much of it I was carelessly using. This was a good exercise to figure out where to eliminate my spending. It allowed me to see how often I had the "it's only $5 or $10" mentality and how much that actually added up. I can imagine this would be really helpful to daily coffee drinkers, smokers, or people who stop by the gas station everyday for a snack or a drink. It's the little things that you think don't matter, that are actually breaking your bank. So, if you can figure out where you are spending your hard-earned dollars and what you don't actually need to survive, then you can begin to cut back and start saving. There are also apps out there to track your spending, as well as the old fashioned Excel spreadsheet.
2. Monthly "allowances": The best thing we ever did to eliminate financial fights was to set a specific amount we allow ourselves each month to spend however we want, no questions asked. This amount rolls over too, so you can save up for something big. Anytime we do anything SEPARATE from each other (Target, drinks with the girls, a gym membership, a music streaming service only I use, Allyn's WWE subscription, the Rise Conference I'm going to in January), we strictly use our own allowanced money. Anything we do together (dinner, a concert, vacation) comes out of our joint account. This alleviated his frustration of me spending way more (because I like clothes) and him never spending much at all. It's fair and no one feels like they are getting taken advantage of. And you can have fun with it as well! Allyn will often use his allowance to buy me a random gift. I personally have been saving for 6 months to buy him tickets to a Steeler's football game.
3. Only buy what's on sale: This is one of the harder concepts in my eyes, but has proved to be one of the most crucial. When the question comes up of what we want to get at the grocery store, the answer is always, "whatever is on sale". Meat and produce can be so expensive if you don't shop the cost. Therefore we save tons of money by choosing whatever is a deal. Buy one get one free is also a great time to stock up on essentials. And most of the time, you can go with the off brand for products. It's the exact same thing, just different packaging. Now don't get me wrong, we still splurge. I love wine, so even though I try to buy bottles $13 and under, it's still a lot of money for the volume when compared to liquor or a case of Coors Light. We also love fancy cheeses and specialty foods. There will be times and occasions we buy this stuff but it's not every time and the bulk of our cart, the necessities, are where we try and save.
4. Minimize the amount of credit cards you have: When Allyn and I got married, I had a Target, Macys and Amazon credit card. I never racked up substantial debt but the security of having them was dangerous. So, we cut them up. Allyn and I only have one credit card, our joint banking credit account. This way, we only have one method to rack up debt, and we don't lose sight of how high it gets. In a perfect world we try to keep it low and pay a chunk of it off every month (if it's not already at a $0 balance). But life happens and urges are human nature. The goal is to eliminate debt, and the best way is to eliminate the avenues which allow you so much freedom.
5. Coupons and Discount Codes: When shopping, you can more often than not, find a coupon or code for that item. I try to avoid buying clothes or things I want unless I can save some kind of money on it. I usually just Google the store's name and discount code and find at least a 10% coupon. I also recently went through the million Bed Bath and Beyond coupons I had, as well as some random other ones and organized them in a small file folder (nerdy mom status). I always keep this in my purse just in case. Some of my favorite sites to save include Ibotta (grocery store savings), Groupon (restaurants and experiences), and RetailMeNot (online discount codes).
Finally, if theres one thing to take away from this blog, it's to live below your means. Start saving young, and always have a nest egg for emergency situations. If you think towards the future, and monitor your spending while simultaneously putting away in savings, you will be much happier in ten years. It may not seem like it yet, but the habits you have now, will drastically affect you in the long run.
Whether this helps someone or not, I hope you can take something away from it and apply it to your own financial situation. Every relationship is different and what works for us might not for someone else. But here's to less fights, more savings, and a peace of mind.
xoxo, Isla Girl