Q: I recently got married, and I'm wondering how much my wife and I should combine our financial accounts -- checking accounts, credit cards, etc. Does getting married mean we should combine everything?
A: Your financial futures are now intertwined, but that does not mean you have to share every single financial account. In fact, sometimes a couple can manage more effectively if some things remain separate.
Here are some suggestions for a new couple who's figuring out how to integrate their finances:
Communicate and collaborate. Start by laying everything about your financial situation on the table: current resources and income, as well as liabilities like student loans or credit card debt. Once you both see the full picture, start to collaborate on the future. Discuss how to solve any immediate problems, and figure out what your financial goals are. You may get a clearer picture of which accounts to combine and which ones to leave separate once you know what role you expect those accounts to play.
Pool your major resources and expenses. To start with an obvious example, you probably wouldn't get married but each continue to maintain your own apartment. In other words, it makes sense to combine the big things like living quarters, and it also makes sense to combine long-term savings accounts, as long as you agree on the purpose of such accounts. Also as part of this exercise, look at things like the health care options and retirement benefits offered by your respective employers to see how you can best benefit from these programs as a couple.
Agree on your responsibilities. Come to an understanding on your respective responsibilities -- who is responsible for paying which bills, and how much is each of your going to contribute to your savings accounts? Part of your responsibilities should be full and immediate disclosure of any problem that comes up, such as a career setback or an unexpected expense. Financial problems only get worse if either spouse is exposed to them without accurate information.
Some day-to-day things can stay independent. None of this means you have to share everything. It can be more practical to keep checking accounts and even credit cards separate, so you don't have to coordinate every expenditure on a day-to-day basis. Just make sure you have a shared understanding about spending and debt management with regards to these accounts.
Of course, every relationship is a little different, so the same principles won't necessarily work in every case. However, if you and your wife talk through the above issues -- even if you come to different conclusions -- you will have a basis for making your own decisions about how to manage your joint finances.
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