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You’ve moving in with a new partner, and you need to figure out what to do with your finances. Here’s why you should combine finances.
When you move in with a new partner, you need to decide if you’re going to combine finances or not. In most cases, combining your finances is going to happen. I’ll admit that I’m not going to fully combine my finances with anyone ever again, but there are going to be elements that I have to combine.
Having one joint account for the bills can work. However, you can also do it where one person agrees to pay the bills and the other will send their share.
Either way, you’re not fully combining your finances. This can be beneficial for a few reasons. Here’s why you won’t want to combine finances with your new partner.
You’ve been financially abused in the past
If you’ve had to deal with financial abuse (or any sort of abuse in the past), you probably don’t want to combine too much, especially right away. There are going to be a lot of fears seeping in from the past, even if they aren’t justified. There’s nothing wrong with holding back on combining everything to see how you live together first.
Sometimes, you don’t see some real problems until you move in. It’s worth giving it some time to get settled in some sort of routine before you talk about how you’ll fully combine your finances.
You will need to discuss how you will pay your joint bills. Will you opt for a joint account, or will you end up just agreeing on who will pay each of the bills to make sure you share the bills equally?
Don’t combine finances if you can’t agree on spending and saving
It’s really difficult living with someone who has a different mentality on money as you. This is something I found with my ex-husband. He’s a huge spender and he got frustrated if he couldn’t spend money immediately on what he wanted because of savings goals. (There were other issues with him though as he would then complain we didn’t have the right amount to put in savings and it was my fault for one small takeout order for lunch compared to his five per week.)
What was really clear is that money-wise, we weren’t compatible. Sometimes, that is something you can get over. If one person is willing to change the way they use their money, it is possible to see a shift to the same goals. It doesn’t always happen, though. It gets frustrating when you set a savings goal and then find out the other person is constantly spending.
Don’t combine finances fully if this is the case. The best option is to have a joint savings account and a joint checking account for anything that is combined. I’m talking bills, future purchases or vacations together, etc. You then keep your individual accounts where your own paychecks go into. You’ll also have your own savings accounts for your own needs.
When there are major debt issues
If one of you has a lot of debt, it may not be worth combining finances right away. This could depend on the state that you’re in. If you combine finances, you could end up liable for each others’ debts. I’m fortunate that in Canada, I wasn’t liable for anything under only my ex-husband’s name. So, it doesn’t matter that we still have a few financial elements combined. I’ll never have to pay out his debts.
However, some states, and even countries, lead to individual debts being jointly liable when it comes to combining finances. Marriage can even lead to this, so if one of you has a lot of debt, I’d heavily consider looking into liabilities before getting married. There’s nothing wrong with protecting yourself financially.
It will depend on the type of debt it is. Student loan debt is very different to credit card or line of credit debt.
Don’t combine finances if there are addiction issues
Everyone deserves a second chance. I do believe that. However, a second chance doesn’t mean going in blind when it comes to finances. If your partner is recovering from any sort of addiction, you won’t want to combine finances. You’re running yourself into a lot of problems. People relapse all the time, even if they’ve been sober for years.
This is a conversation to have for a variety of reasons, though. Bringing someone into your home with a past that involves addiction could lead to other types of problems. It’s going to depend on the type of addiction, the severity of it, the time sober, etc. Personally, I don’t think I could live with someone with addiction issues, especially with young children, let alone combine my finances with them. I just try this site, which is all about addiction and the process of coping with this disorder. I told myself that if I ever know someone who has an addiction to drugs or alcohol, I better recommend this Pacific Ridge Rehab Center to help them fight their addiction.
One of you has children
Let’s say you have children and your new partner doesn’t. You may find that combining your finances isn’t really an option. While you want to become one household, you may not want to feel like your new partner is paying for your children. Your new partner may not want to pay extra for children that aren’t theirs. Honestly, this would be a huge red flag for me when it comes to the moving in stage, but I get it why it happens.
You will want to look at how combining finances affects benefits you may get. Is it just the moving in part that affects payments for the children? What about any child support you may need to pay or you may be getting?
It’s important to have a conversation about all this before you move in together, though. You know that, right?
MORE: Why you should combine finances with your new partner
You and your new partner need to have a conversation about combining your finances when you move in together. There are ways to combine without combining everything. Is this the best option for you?