Smart SpendingSmart Spending

She's a saver, he's not

She also makes a third of what he's paid. Managing money after they're married is going to require some compromise.

By MSN Money Partner Apr 30, 2012 10:22AM

This post comes from J.D. Roth at partner blog Get Rich Slowly.


Get Rich Slowly on MSN MoneyEveryone is different. That's the beauty of life -- but also one of its greatest complications. When two people fall in love, the meshing of these differences can be both fun and frustrating, especially when it comes to personal finance.


Image: Couple Arguing (© Con Tanasiuk Design Pics/Corbis)That's what Elaine has discovered. She'd like some advice on how to merge finances and philosophies with her fiancé. Here's her story:

My fiancé and I are both very responsible with money -- neither of us has any credit card debt or late fees on our records -- but we have very different philosophies about money. I've always been a saver, and he's always been a spender.
I make around $25,000 a year; he makes about three times that. I always knew my chosen career field was not a profitable one, and have always saved with that in mind. He doesn't enjoy his job as much as I do, and gets most of his joy in life from spending the money he makes on things he really wants. His purchases aren't frivolous -- he researches what he's getting, waits until they are on sale to buy them, and uses them extensively once he's bought them -- but he does spend most of what he makes every month.
He has shown willingness to compromise. At my insistence, he's started an emergency fund  and is contributing toward his retirement account, but he still feels that he makes money so he can spend it on things he wants.
With that in mind: What suggestions do readers have for a responsible, soon-to-be-married couple with a very different philosophy on money and a significant income disparity? Has anyone encountered this and found a good way of merging finances?

Elaine's in a tough situation, and she needs to be careful about how she proceeds. In every relationship, the partners will have certain goals that don't align with each other. But it's important to make sure your common goals are met before pursuing personal passions. The tough part is determining exactly what those common goals are. (Post continues below.)

Here are a few ways to be sure that both partners are on the same page and that nobody feels singled out as the bad guy:

  • Regularly review accounts. Schedule regular times to go over the household finances. Some couples do this weekly; others do it once or twice a month. Be sure to review upcoming income and expenses, and to deal with any unexpected budget items.
  • Don't be controlling. Take "you" and "I" out of your budget conversations; replace them with "we" and "us." Each partner needs to feel as if they're involved in the household finances. If you unilaterally tell you husband he can't spend money on his hobbies, he's going to be resentful. Work together to find common ground.
  • Be supportive. Find ways to encourage each other toward your shared and separate goals. If your wife asks you to call her out on bad behavior, do it. If she wants advice, give it. Don't lecture and don't act superior, but help your partner improve.
  • Play to your strengths. Some people hate looking at the big picture -- they don't care about retirement savings, interest rates, or the Dow Jones Industrial Average. Others don't like nitty-gritty stuff like clipping coupons or looking for sales. Let each partner be in charge of the stuff they're good at.

It's rare that partners agree completely on how to handle their money. The key is to find as much common ground as possible, and then to compromise on the rest.

We've talked a lot in the past about whether couples should keep joint or separate finances. I don't believe there's any one right answer. It depends on the couple. In the case of Elaine, I think there are three good options:

  • Joint finances with an adult allowance system. Elaine and her partner would pool their money in shared accounts, and then withdraw a fixed amount into personal accounts each month. (He would probably withdraw more since he contributes more.)
  • Proportional finances. Elaine and her fiancé would contribute money to their joint accounts based on the proportion of their income. Since he makes three times what she does, he would contribute three times as much as she does to the joint finances. After funding the joint accounts, both partners could do whatever they wanted with their leftover money.
  • Separate finances. A final option is for Elaine and her husband-to-be to keep completely separate finances, dividing the household bills in some way they find equitable. That's what Kris and I did, and it worked for 23 years. We never fought about money.

So, what do you think? Based on the info Elaine provided and based on your own experience, how should she and her partner work together to cope with their different income levels and their different financial philosophies?


More on Get Rich Slowly and MSN Money:


Apr 30, 2012 1:10PM
I'm surprised by the author's expectation that, as a committed couple, Elaine and her fiance would naturally have different access to the household money proportional to their individual income, best summarized by this assumption: "He would probably withdraw more since he contributes more." I disagree with this advice for marrying couples. Setting up a financial system in a couple is part of setting up the parameters of the relationship, and giving one partner more access to money because their line of work is more lucrative is, well, ludicrous! If they have children and one person's income goes to zero while they are caring for children, does that mean the person gets zero allowance during that time "because they contribute less"? I think it is a mistake in a relationship to attach the same value to your partner's work that his or her employer does. The household functions because both people contribute different things, in different ways. It is important for a successful relationship to honor that, and to ensure that both partners have equal power when it comes to money, even if you choose mostly separate finances.
Apr 30, 2012 10:24PM
This is a topic that a couple should talk about before marriage , 70% of marriage end because of money problems.
Apr 30, 2012 11:04PM
my wife and i both get an allowance.  the rest goes into shared checking/saving/Roth IRA.  I spend my money on what I want, she does the same.  If I buy something stupid, then she can just shrug and say "whatever."  
May 1, 2012 2:13PM
As someone who never talked about money with her spouse before we got married I cannot stress enough how important this is prior.  10 years into this marriage we have different views still.  We did the joint approach.  I am now thinking it would have been better to do the separate accounts and we each contribute.  I can see good points in all of the approaches.  I suggest the couple talk about all the options and see what works best for them. 
Apr 30, 2012 7:56PM

Keep peace, separate your financial life.  Regardless the spouses' tendencies in the beginning, poeple tend to change over decades.  'Change' as in lean to a greater degree toward one end of the spectrum or the other.  Separation simplifies each spouse's view and permits personal space, a sense of self direction and a degree of control.  Further, when spouses find themselves on opposite sides of the coin, they have a 50% better chance of a successful retirement as one spouse's financial strengths will have a chance of compensating for the other's financial weaknesses.  There is usually some sort of dovetail effect in the duties, financial and otherwise, within a relationship where one spouse is a spender and the other a saver.  Taking on the financial duty, while important, certainly does not trump anything else.  There is intrinsic value to each view and both should be able to look upon their role with a sense of accomplishment and pride.  As with any relationship, dissolution is always a possibility.  Separated financial lives will ease dissolution somewhat, but won't make the process painless. 

Apr 30, 2012 10:14PM
Smile Saving nickels and dimes in this age and era of 35 million paychecks is an act of futility. It is so boring waiting til the next paycheck to save a few bucks. It is hardly worth it. Seriously.
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.


Smart Spending brings you the best money-saving tips from MSN Money and the rest of the Web. Join the conversation on Facebook and follow us on Twitter.