Before getting married, my now husband and I often discussed our financial future. We chose from the start to have “all things in common,” (Acts 2:44)[1] financially that is, by combining our financial resources. That was a difficult and time-consuming decision for us. The reality is that finances are a huge part of any married couple’s relationship yet far too few individuals discuss the details of their financial goals and attitudes before tying the knot.[2] Having these discussions is beneficial because how couples choose to manage their finances from the beginning can have a long-lasting impact on their future marriage.[3], [4], [5]
A question every couple has to answer at some point is “How will we manage our finances together?” This can be a difficult subject to discuss, especially because financial disagreements are one of the most common arguments among couples and they can contribute to divorce.[6] Generally couples take one of three approaches: (1) keep completely separate accounts, (2) completely combine all assets and use joint accounts, or (3) a combination of the first two. Recent research surveyed couples on their choice of financial management and found that the majority of couples choose to have joint accounts at some point, but it is becoming more and more common to use other strategies.4
The question remains, how could completely merging your bank accounts affect you and your relationship?
1. It can guard against declines in early marital satisfaction. The first couple years of marriage set a precedence for the remainder of a couple’s time together. Commonly, marriages suffer from a decrease in marital satisfaction during this time,[7] but there are ways to combat this decline and improve the trajectory of marital satisfaction. Completely combining finances by pooling both individuals’ money from the beginning is one of these ways. Combining finances can help to increase a couple’s financial harmony, transparency, and goal alignment.4 In other words, couples who choose “all things in common” often find themselves on the same page as their partners financially.
2. It can help couples have longer lasting marriages. Creating and maintaining joint bank accounts and pooling money has been shown to be related to longer lasting relationships. This may be because it can increase a couple’s relationship satisfaction and is associated with increased commitment to the relationship.3 It also has been linked to relationship stability.5 Many people want and expect their marriages to withstand the tests of time, financially and otherwise. Completely combining finances may provide strength to couples in times of financial hardship that help build needed trust and commitment.
3. It can help couples be more communal. Being in a communal relationship means that you and your partner work together as a mini community for the benefit of the relationship. In this case, partners do things without expecting anything in return. In contrast, some couples may experience an exchange relationship where the expectation is “repayment” for actions or sacrifices. This looks something like a wife saying she is entitled to go out this Saturday night because she watched the kids as a service to her husband while he went out the previous Saturday. The wife in this example expects “repayment” from her husband because of her own actions. Research has shown that couples who are communal are happier in their marriages than those who are in exchange relationships.[8] As couples choose to join their accounts and share their financial resources, they can develop greater communality and therefore more satisfaction in their marriage.3
Though these are common benefits of couples completely combining finances, this may not be the situation for all people. There are some circumstances where combining finances may not be the best option. These circumstances could include re-marriages where family and parenting situations are more complicated, or marriages where one partner has a financial addiction and should not have access to all of the finances.
Takeaways
The Strengthening Power of Togetherness. Often couples marry for better or for worse, in sickness and in health, and for good times and bad. Managing money is an unavoidable task that couples must embark on. There are many decisions to be made in financial management. When these decisions are made together, it can improve relationships by helping them last longer, keeping them satisfying, and allowing for selfless service or communality.3, 4
Mad Money. Completely combining all of your finances in marriage can be a stressful task. It can be hard to navigate within a partnership what each individual should be spending money on and when. One way of combining finances yet managing disagreements is a practice called Mad Money.[9] To practice this, each individual receives an allotted amount of money “off the budget” that they can spend in whatever ethically and morally correct way they see fit without argument from their partner. It can be as little as $5! This provides a way, especially in homes with tighter finances, that individuals can still maintain the benefits of joining their finances while finding some individual financial freedom and decreasing financial stress.
References:
[1] King James Version Bible. (2013). Intellectual Reserve. https://www.churchofjesuschrist.org/study/scriptures/nt/acts/2?lang=eng
[2] Saxey, M. T., LeBaron-Black, A. B., Inman, N. F., Yorgason, J. B., & Holmes, E. K. (2024). The earlier couples first discussed finances, the better? A dyadic, longitudinal replication and extension. Family Relations. http://doi.org/10.1111/fare.13030
[3] Gladstone, J. J., Garbinsky, E. N., & Mogilner, C. (2022). Pooling finances and relationship satisfaction. Journal of Personality and Social Psychology, 123(6), 1293-1314. https://doi.org/10.1037/pspi0000388
[4] Olson, J. G., Rick, S. I., Small, D. A., & Finkel, E. J. (2023). Common cents: Bank account structure and couples’ relationship dynamics. Journal of Consumer Research, 50(4), 704-721. https://doi.org/10.1093/jcr/ucad020
[5] LeBaron, A. B., Holmes, E. K., Yorgason, J. B., Hill, E. J., & Allsop, D. B. (2019). Feminism and couple finance: Power as a mediator between financial processes and relationship outcomes. Sex Roles, 81(3), 140-156. https://doi.org/10.1007/s11199-018-0986-5
[6] Dew, J., Britt, S., & Huston, S. (2012). Examining the relationship between financial issues and divorce. Family Relations 61(4). 615-628. https://doi.org/10.1111/j.1741-3729.2012.00715.x
[7] Lavern J. A., & Bradbury, T. N. (2010). Patterns of change in marital satisfaction over the newlywed years. Journal of Marriage and Family 72(5). 1171-1187. https://doi.org/10.1111/j.1741-3737.2010.00757.x
[8] Clark, M. S., Lemay, E. P., Jr., Graham, S. M., Pataki, S. P., & Finkel, E. J. (2010). Ways of giving benefits in marriage: Norm use, relationship satisfaction, and attachment-related variability. Psychological Science 21(7). 944-951. https://doi.org/10.1177/0956797610373882
[9] Britt, S. L., Hill, E. J., LeBaron, A. B., Lawson, D. R., & Bean, R. A. (2017). Tightwads and spenders: Predicting financial conflict in couple relationships. Journal of Financial Planning, 30(5), 36-42.