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Combining finances

blog.mitchjlee.com

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Re: Combining finances

#11

Post by treespace8 »

My wife and I do the share model. However money is a very emotional thing.

The only thing I’m strict about is big picture. IE, Do we have enough savings? Are we on track of retirement?

If I focused on keeping a fun money budget things would get stressful. IE is her hair, nails from fun money? When I take the kids to laser quest is that my fun money? Did we really need new placemats? Should that be fun money?

When there are no kids and both work full time it’s simple enough I guess. But when you are a parents it just gets too complicated.

Re: Combining finances

#12

Post by lupire »

skrebbel wrote: post #2

This is what my SO and me have been doing for 8 ish years now and it's great. We call it "pocket money". I can't complain when she spends it all on shoes and bags, she can't complain when I spend it all on beer and hamburgers. When we were poor, we both only got a little pocket money each month. Now that we're richer, we both get more. I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my…

What happens if you spend your pocket money on end-of-life care, and then your SO wants some too?

Re: Combining finances

#13

Post by loco5niner »

soperj wrote: post #9

This sounds basically like have one pot of money, but allow both people to blow some of it every month on unnecessary stuff. Which is the opposite of what a saver personality would like to do. I don't see how it would work in a relationship where one person is blowing the "fun money" every month while the other person saves it. There would still be resentment.

> blow some of it every month on unnecessary stuff.

Sounds like you are a saver. I'd like to point out that resentment can go both ways.

They addressed this in the article. A conversation needs to be had to decide as a couple how much (non-zero amount of) money is to be spent. It can easily be a low number, if that's what the couple agrees on. As long as the couple comes together in that conversation, there should not be any resentment.

If there is resentment after that conversation (as long as the agreement is followed), the "resenter" is in the wrong.

Re: Combining finances

#14

Post by toast0 »

StavrosK wrote: post #8

What if one spouse makes seven figures and the other is unemployed and takes care of the household? The income disparity then is too high for this, it seems to me, but maybe it's just me.

My spouse and I have a simple plan. I make the money, and my spouse spends it. :)

When money was tighter, we would coordinate more closely and more frequently about expenses and timing. Now I just maintain a certain balance in checking and we coordinate over large payments to make sure they don't hit checking all at once.

If you or your spouse is making seven figures, you shouldn't have actual money problems -- even if taxes take half, you can save half and still have 250k/year to spend; spend half of that on a $5M mortgage, and you've still got more spending money than US median income. Your money management priorities should be around limiting the time it takes to manage, unless you get enjoyment out of micro managing it.

Re: Combining finances

#15

Post by clavalle »

soperj wrote: post #9

This sounds basically like have one pot of money, but allow both people to blow some of it every month on unnecessary stuff. Which is the opposite of what a saver personality would like to do. I don't see how it would work in a relationship where one person is blowing the "fun money" every month while the other person saves it. There would still be resentment.

That's the beauty of the system...each one should not care what the other does with their 'allowance'. If one wants to save, or invest, or what have you, while the other one buys gifts for your neighbor's aunt because they like giving gifts to everyone...well, so be it. It is not from the centrally held account so it is perfectly fine.

Meanwhile, that central account and the rules of expenditure are rock solid and it will remain unmolested with wild gift giving, or extravagant lunches, or a risky investment, or the burning desire to save every penny under a mattress.It is resentment free.

Re: Combining finances

#16

Post by kasey_junk »

I think this skips the biggest source of tension in my household with regards to money. The only way I know to describe that is 'it's worth less to you than to me'.

For instance, I would tomorrow gladly outsource the entirety of our laundry work to a service. It would be much cheaper than other monthly expenses we have that I value much less highly. But my wife has shot that down. She has all manner of reasons why its not a good idea and none of them are related to the bare economics of the problem.

As academic economics has found, so does my family, the models need to be sensitive to lots of data that is not captured in price to make reasoning about these things workable.

Re: Combining finances

#17

Post by loco5niner »

lupire wrote: post #12
skrebbel wrote: post #2

This is what my SO and me have been doing for 8 ish years now and it's great. We call it "pocket money". I can't complain when she spends it all on shoes and bags, she can't complain when I spend it all on beer and hamburgers. When we were poor, we both only got a little pocket money each month. Now that we're richer, we both get more. I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my…

What happens if you spend your pocket money on end-of-life care, and then your SO wants some too?

End-of-life care has nothing to do with pocket money.

Re: Combining finances

#18

Post by jacobr »

soperj wrote: post #9

This sounds basically like have one pot of money, but allow both people to blow some of it every month on unnecessary stuff. Which is the opposite of what a saver personality would like to do. I don't see how it would work in a relationship where one person is blowing the "fun money" every month while the other person saves it. There would still be resentment.

We save some of our “fun money” for things like buying gadgets or that extra monitor I might not “really” need, don’t see why there would be resentment?

Re: Combining finances

#19

Post by blts »

skrebbel wrote: post #2

This is what my SO and me have been doing for 8 ish years now and it's great. We call it "pocket money". I can't complain when she spends it all on shoes and bags, she can't complain when I spend it all on beer and hamburgers. When we were poor, we both only got a little pocket money each month. Now that we're richer, we both get more. I buy hotel breakfasts now sometimes (the buffet ones), on normal work days, in my…

Does it lead to overspending? Since you have your pocket money - then you need to spend it?

Re: Combining finances

#20

Post by loco5niner »

StavrosK wrote: post #8

What if one spouse makes seven figures and the other is unemployed and takes care of the household? The income disparity then is too high for this, it seems to me, but maybe it's just me.

At seven figures, you shouldn't have any money problems.
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