How couples can merge finances easily

United we stand and divided we fall applies to everything from hockey (unless you’re the Leafs) to relationships.  And within a relationship it is particularly true of money.  But merging finances can be more difficult psychologically than merging lives. 

Coupling financially isn’t about dependence, rather it is about making the economic unit stronger.  Fortunately, it isn’t an all or nothing process.  If you are in a new relationship, or even one which has a brick wall between the two of you financially, take it one step at a time.

First of all tackle the joint bills by opening a chequing account for that purpose.  Figure out your monthly fixed expenses, rent or mortgage, utilities, insurance and so on.  You should makes deposits for all of these expenses either at the beginning of the month, to ensure that there’s sufficient money in the account, or divide it into pay periods. 

Set up an automatic transfer to avoid distress if one partner forgets to make the deposit on the agreed date. 

Next, estimate variable expenses; groceries, household supplies, entertainment and anything you spend together to keep your home going and lives purring along.

Total the amount, divide it in two and add that amount to the automatic transfer. At least initially the account should be carefully monitored so that it doesn’t get overdrawn.  Most people underestimate variable expenses. 

If supplementary amounts are necessary on a regular basis, consider increasing the “draw” from each partner.  Either that or keep a tighter rein on the spending.

The next step could be a joint credit card to pay for joint expenses such as travel.  There is no harm in having your own credit card also for personal use, just make sure you pay off the balance monthly.

Merging finances further can be tricky especially if one partner has substantially more debt than the other.  This is why I urge full financial disclosure before a marriage.  

Assuming you cleave to the notion that  marriage, or other forms of partnership, should hold through  sickness and health, try to think of money as part of it -- debts, assets and the whole shebang.  My experience is that it all tends to even out; one partner may have more debts at the beginning but earns more income during the course of the marriage, or receives an inheritance.

If you can learn to see your finances as ours rather than mine or yours, and if you confer regularly about money matters, you’ll both be better off both financially and emotionally.