Issue #68: Stop Letting Money Ruin Your Relationships 😅

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Talking about money in relationships can feel a biiiit awkward, but it’s something we HAVE to talk about with our significant other.

Your money is going to be overlapped, but how else can you manage it effectively without talking openly and honestly…

As a married man of almost three years, I’ve definitely had to learn how to manoeuvre this tricky topic.

That’s right, I talk about it for a living on the internet, send you one of these newsletters every week, but still struggled with finding the best way to have money conversations with wife.

And while there is DEFINITELY not one way to do it (and I cannot stress that enough)

We have slowly but surely figured out what works best for us when it comes to our money set up!

So on that note.

Let me tell you what works for my marriage and why…

Bills (yuck🤢)

So we have a joint current account for all of our household expenses - things like mortgage payments, council tax, energy bills, etc… (the things on a direct debit basically).

Plus it pays off our credit card statements IN FULL every month (but more on that later)

Each month, both our salaries get transfered into our account, and everything gets paid from there.

This setup keeps it fair, organised, and transparent. 🤝

But what do we do with the rest?

Savings 😌

When it comes to savings, we’ve chosen to keep things separate. PURELY for tax purposes… let me explain.

Each adult in the UK has a £20,000 annual ISA allowance, so by saving individually, we each get the full benefit.

WIN!

This means up to £40,000 across both of us can be saved or invested each year without paying income tax or capital gains tax on the returns.

So whether you’re putting money into a Cash ISA, Stocks and Shares ISA, or even a Lifetime ISA, using your individual allowances is a smart financial move.

For this we both use Trading212 as it’s simply… the best platform (try convince me otherwise) 🤑

p.s. This week I’ve asked them to sort you guys a unique interest rate on their cash ISA (well above their standard offering).

The link below get you an extra bonus 0.76% on top of their already amazing rate JUST BECAUSE YOU FRICKING READ THIS NEWSLETTER! That’s 4.86%

Pensions 👴🏻

Just like with savings, we both maximise our pension contributions seperately to take advantage of maximising both the amount we invest and our tax benefits.

There are arguments around the person who is in the higher tax bracket contributing more towards savings for increased tax savings, but luckily we are both in the same bracket :)

Additionally, if work is offering you a match scheme, then all those tax saving calculations go out the window for me!

Emergency Fund 😬

We’ve built a joint emergency fund. Emergencies like a broken boiler, car trouble, or unexpected bills (I might have a parking ticket on the way) usually affect both of us, so it makes sense have our money together for this purpose.

We store it in an easy access savings account (currently with Chip) as it’s a high-interest and we can access it in second if there is an emergency. Right now it’s full but this would get filled up from our joint income pot.

FUN MONEYYY 🥳

This is one we swear by.

We each have our own monthly fun money allowance, in separate accounts.

This is a portion of our income we can spend freely, without needing to explain or justify ANYTHING.

Having this set up avoids financial micromanaging and gives each of us a sense of autonomy, so whether I want to guilt-free buy that extra coffee at work or feel the urge for new running trainers even though I already have a pair, it’s covered.

Our fun budget allowances are smaller right now though (thanks mortgage 🥲), but the principle remains:

You should never feel like you’ve lost control of your own money just because you share a life with someone else.

Now we’re defo not perfect, but our financial arrangement works well for us because of openness and trust. We keep things transparent by having regular open conversations about financial goals, savings targets, and big purchases.

This setup gives us a clear structure while still leaving room for individual freedom - and more importantly, it avoids money becoming a source of conflict.

Credit Cards 💳

I mentioned this one a little earlier, as we both have individual credit cards where we do the majority of our spending. There are a few things worth mentioning about this:

• We collect points and so this has allowed us to max out sign up bonuses and ensure that our spending gains the most rewards possible

• This covers mostly our mutual spending (our fun money pot covers the rest)

• It gets paid off from the main account so we can both see how much is being spent but not exactly where it is going. That builds an element of financial trust whilst also not ruing any birthday suprises on the way)

• If either of us has a large purchase, that will always be shared with the other prior to putting it on the card.

Now luckily my wife and I have similar incomes so we can split pretty equally on these things

Buttt what happens if you and your partner earn significantly different amounts? Do you still split equally or based on income?

Let’s say one person earns £70k and the other earns £30k. A strict 50/50 split on rent, bills, and holidays might feel ‘equal’, but it leaves one person with far less breathing room… and potentially resentment 😬

That’s why many people lean towards splitting proportionally to income. It recognises the reality of different earnings, without turning the relationship into a financial burden for one person. And I think I agree with them too.

That said, what matters most is that you both feel comfortable. I’ve seen couples thrive with 50/50 splits and also seen people completely merge their money and never think twice about who pays what.

As with everything in relationships and money - there’s no right answer, just the right answer for you.

The key is talking about it early and often, before problems creep in or assumptions get made.

^{DISCLAIMER: None of the above is financial advice. This newsletter is strictly education and should not be taken as investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and always do your own research.}