How do people living together deal with finances?

Question

I just moved in with my fiance and he and I have started to absorb the cost of that and trying to sort it out. We both make descent money, but we both like to spend and we both have considerable credit card debt. He wants to dictate how I deal with my debt and my feeling is that I made it and I will fix it. He has debt and I feel he should deal with it. What's normal in relationships. this is my first time in a situation like this and I think my pride is getting in the way. Help.

Answer 1

Y'all need to sit down and have the money talk.

First thing you need to do is come up with a cost of living budget. Make it realistic, but neither too strict nor too lenient. Use money you have left over to pay down BOTH of your debts.

Set up a joint account ONLY to pay bills. Agree how much both of you will put into it on a paycheck-by-paycheck basis.

As for paying down debt, there are two ways to address it. Either 1) pay down the smaller debt first and roll those payments into the larger debt to pay it off, or 2) pay down the debt of the person with the poorer credit rating. Both ways have advantages. The first one is the "I won't miss it" syndrome. Make minimum payments on the larger debt at first (servicing your debt) while putting as much money as you can to pay down the smaller debt. Once that debt is zero, AND you've torn up those credit cards, pay down the larger debt using the money you would have used for the smaller debt. Once both debts are gone, put that money into INVESTMENTS or retirement funds. The second method, paying down the one with the poorer credit score is a way to increase that person's credit score, which will help you when you decide to make any big ticket items, like a car or house.

My wife and I dealt with debt the first way before we were married. The only debt we currently carry is student loans, but that is considered good debt.

We do currently have a checking account, but I do pay most of the bills. We've been using her account to pay off little unexpected expenses, like my appendix surgery late last fall (insurance only paid 80% of over $20,000), and to increase the downpayment on our new car (my 13-year-old Park Avenue died suddenly).

You'll have to deal with the "pride" issue, but you both need to address finances as a couple, a unit as the case may be. Sit down and talk about it. Draw up a budget. Agree how much each of you shall pay into it. Use the rest to pay down debt.

EDIT: I forgot to mention... don't get yourselves in credit trouble again. Carry one credit card and debit cards only. Use the credit card for emergencies. My wife and I use debit cards, and there is one American Express card.

Congratulations on your upcoming wedding.

Answer 2

First and foremost, he needs to understand he can't dictate squat in the relationship. Now, if you both want to unite and take care of your debt as a unit, then you need to sit down and add everything up and decide on a plan. However, if it is really unbalanced - in other words, one of you has a lot more debt than the other then it would only be fair for that person to pay more towards the outstanding balances. Forget about your pride - you both are in debt, you both need to get out of debt so you can plan a future together - that is if he's willing to stop dictating to you!

Answer 3

This is what I did when I got married recently and it seems to be working very well. We each kept our seperate bank accounts. We sat down together with a spreadsheet and list all the bills we had together. Then made a list of debt we had before we got married. All this was put into the spreadsheet along with when we each got paid. We worked out a strategy that everything is paid and the combined expenses are shared - utitlities and groceries (we both have our own house). We have stuck to this budget for the past 6 months and have actually seen our savings grow. It takes time to work it out but if you try you can do it, just be patient and talk everything through.

Answer 4

When you get married, you will inherit his debt and he will inherit yours. My advise is to sit down and come up with a plan to eliminate your debt. Financial problems are a huge strain on marriage, so try to make a plan and stick to it. I recommend a joint account which each of you deposit all or 3/4 of your income to pay for your expenses. Some people like to have their "own" money, this would come from the other fourth of your paycheck.One of you should handle paying your bills, but both of you should have access to the account records. This is only my opinion, everyone is different when it comes to handling finances, so sit down and talk with your fiance and come up with something you are both happy with.

Answer 5

I think that ONCE a couple is engaged, they should start looking into joint accts. His and hers become OURS, and you need to work at finances together. MOST couples fight over money and some even split up over something so pointless. But you just have to work through it. I DO suggest that BOTH of you start figuring out a plan of action to get rid of the debt as fast as possible. There is NOTHING worse than starting a life together with a bunch of baggage.

Answer 6

Divide the bills like rent, utilities, groceries, etc down the middle and each pay your share but otherwise both deal with your own finances. It's also only fair to share entertainment costs, movie, dinner out, drinks, whatever. If you're living together you aren't dating anymore and the guy shouldn't be expected to pick up all the costs. That's what my husband and I did when we were living together and it worked great.

Answer 7

well honey i have been with my man for almost 12 years and we deal with it this way... he has debt i have debt . we both pay it our money goes into one account and we pay all the bills . you see once you are living with or intend to marry him/ her you have incurred his debt and vise verse . it is that way with every thing children ,family etc..
there are other ways to do it such as he pays the household bills and you pay the credit card bills and provide the "extra money" or just split the bills down down the middle .
if you are getting married you need to talk about this and get it resolved before your marriage.

Answer 8

Either combine the money and pay off the bills or pay them separately. If he tries to dictate how you deal with your debts, hand them over to him and tell him to take care of them.

Answer 9

split everything 50/50. he needs to learn to curb his spending and get out from under his credit card debt. this might be a good eye opener for you. do not marry him until her becomes financially secure. if you marry this guy you will never have anything because of his spending habits.

Answer 10

Different for everyone.
If your looking at marriage down the road..get together and deal with your finances together....TWO gether:)
If its just a living arrangment and no commitment, then keep your finances seperate.