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Combining Finances

This is Rule 1 in my 10 Rules to Eliminate Debt and Change Your Life

If you are soon to be married and looking for a way to tackle the debts you have, or those that will be brought into the marriage, the first step once married is combining your finances.

If you’ve been reading Married (with Debt) for a while, you probably know how I feel about rules. They are generally meant to be broken or rewritten.

But, if you truly believe in something, there are generally rules to follow.

In my financial life, there are 10 main rules I follow (combining finances is the first one).

If you are looking for a path to debt freedom and financial independence that isn’t a rigid, no fun approach, then I invite you to join me.

Combining Finances

So what do I mean by combining finances? On a broad level, it means you have to ditch the mindset that “my” paycheck is my paycheck, and I use it to pay “my” bills and buy the things I want.

Your paycheck and my paycheck become “our” paychecks, just as your bills become my bills.

Why Combine Finances?

Combining finances requires a heightened level of communication between spouses, which will in turn lead to better long-term financial results. That means you aren’t bouncing checks and causing overdrafts. It could also mean you are setting a dollar amount for a purchase that you won’t exceed without first talking to the other spouse.

In addition to changing your behaviors, you have to change your mindset.

It can be easy to rationalize separate finances as a noble effort to preserve independence. This can be especially tough for women, who for generations have traditionally played little to no role in the family finances. Once they became fixtures in the working world, women understandably became proud and protective of their paychecks.

It can also be tough for men, who may harbor paternalistic notions of being the king with his treasure. Combining finances forces two to work as one.

In a perfect household with no debt and ample financial resources, I would say those couples experiencing success and financial freedom should keep things the way they are. There’s no need for combining finances if what you are doing is working.

But if you aren’t proud of your debt and want a change, or you are ready to get serious about some long-term goals, it’s time to take pride in a new ideal: equality. After all, isn’t that what men and women really want and deserve?

How to Combine Finances

The first step is to lay everything on the table, like I mentioned in the recent article, Questions to Ask Before Marriage. Your partner needs to know your income from all sources, your debts and liabilities, and your assets. Likewise, you need to know theirs.

Then you must start combining your separate accounts into one. Add your spouse as a registered user on all accounts. This also means combining your checking accounts into one and not keeping secret stashes of cash. This is a vote of confidence in your desire to truly combine your efforts.

If you aren’t willing to take these steps, you aren’t willing to be in an honest relationship.

No One Said This is Going to Be Easy…

Personal finance is not easy, that’s why it is going to take two people to sort out a mess that both created. Might as well start now with a major behavioral change, as that is the only way you are going to get out of debt (barring some planned or unplanned windfall).

If you are going to succeed with this, you have to be able to let go of past financial mistakes and forge a future of cooperation, togetherness and success. If you are resisting combining finances and know that you should, I urge you to sit down at the kitchen table tonight and develop a new plan that involves shared sacrifice, and shared prosperity.

If done right, combining finances doesn’t have to be restrictive. There is nothing saying you can’t each have some weekly spending money to do with as you please. In fact, I encourage this. But when it comes to the big picture plan and getting out of debt, most of your money needs to be put in the same pot.

In our marriage, we resisted combining bank accounts and bills for a few years, and those were wasted years with no progress, only slipping further into debt. Once we got on the same page, we were able to pay off almost $100,000 in consumer debt, car loans and student loans.

In these tough times, young people can’t afford to spin their wheels. If you are looking for a way to get some immediate traction, do your marriage and money a favor and start combining finances today.


10 Rules to Eliminate Your Debt and Change Your Life

1. Combine Incomes, Finances and Efforts 

2. Spend Less than You Earn

3. Make a Monthly Debt Budget and Live by It 

4Pay Off Debts Smallest to Largest, Regardless of Interest Rates

5. Make Big Changes for Big Results 

6. If You Don’t Need It, Sell It 

7. Save Monthly for Large, Anticipated Expenses

8. Set Aside Some Money for Fun

9. Pay Off Debts Before Investing 

10. The Goal of Work is Retirement