How to manage-merge your finances together after the wedding
Merging finances and money processes is one of the first things we ran into with planning the wedding and directly after. The main reasons that merging money comes up so quickly in a marriage were that we had to find a way to both pay for the wedding and then we also had to find a way to deposit the gift checks afterwards.
Before the wedding you can get a joint checking account at a bank (I suggest opening it at a bank you already use and in a convenient location) and both deposit equal amounts into it. We thought about this but did not know that you could have a joint account while not married. (it seems silly in hindsight) If you have other arrangements on how to pay for the wedding (parents or one or the other is paying for the majority) you may not need to merge this part of your finances just yet. The main financial importance before the wedding is paying the vendors when they have due dates and not fighting about money. We got lucky that we just had a spreadsheet of all the costs and then paid for about half of the costs from our own accounts and logged them.
After the wedding we found that merging our money and financial lives got a little more tricky. First, we had all these wonderful guests that knew we wanted to buy a house and they gave us checks written out to Mr & Mrs ____. Hmmm… We didn’t have any accounts that said that and my name wasn’t changed yet either.
It takes a while for the social security change with the name to happen (mostly because they’re only open weekdays from 9-4, when everyone is working) so we had to have flexibility in the account to accept both names for a while.
We considered using 5/3rd Bank and National City because we both have used them before (and they were local to Chicago), but ended up at Chase instead because they were the ones open past 6 pm, something we need regularly. We were able to open the account with minimal sales pitches for other products in about an hour. At that point the weirdest thing is usually signing in your new name if you are changing it.
After that we decided we needed to get better interest than the 0% in the checking account we just opened and promptly tried to transfer the funds to an online bank because they had a 1.4% interest rate on savings accounts. Interest rates are crazy low right now so it is hard to make anything back in interest but we thought it was a good policy to just start the process anyway. The thing you will find with this process is that it takes a long time (like 3-5 days) for the checks to clear and then another 3-5 days to link accounts. So, don’t plan on doing this in an afternoon like we did.
After all this waiting and planning over several weeks we finally got the right savings amounts in the right buckets for planning purposes. Now comes the monthly bills part of the equation.
I have several friends that decided that they would keep all their finances separate when they got married. I think that is difficult but I understand that it is hard to wipe out everything you have been doing and start over suddenly too. We decided to do some joint accounts for the house, utilities and joint projects and then keep our old seperate ones too. This helps in the short term to give us our own independence when needed and both feel like things are fair with paying the bills too.
We decided we would start with a basic amount in the account to create a cushion and then put in enough each month to cover the mortgage, taxes, utilities and association fees. Other things like the cost of house repairs would come from there also, but the cost of each of our cars, clothes and any other personal stuff comes from our own accounts. Food seems to have fallen in this category, but mostly because we don’t do a lot of grocery shopping and seem to still eat out a lot at work for lunch, we trade off on grocery bills and want to get the points on the credit cards.
If you are combining finances after getting married that are more complicated because either or both of you have property, credit card debt or other monthly expenses you should keep those separate until it is decided how much if any responsibility your spouse wants/can have with them. We don’t carry any credit card balances and my condo sold so we are pretty simple right now. Things ultimately get more complicated once you decide to have kids.
One last note about women and finances. Most women believe they should have a secret stash in case they need to get out of a marriage later on in life for some reason they could not have foretold when they got married. I think the fear of abuse, fear ofending up in financial ruin or divorce are why women decide to do this and in the past it was probably more important than today.
Most women have far more earning power today than 25 or 50 years ago, so having a stash is somewhat less of a necessity when you have a current job while married. If you don’t, then your situation is different and this may be something you want to do. I have read about women having siblings or parents keep an account for them or having one set up in their maiden name and listed under another address. I believe in keeping my original accounts and not giving them up so I don’t feel the need for a secret stash. But it is something for every woman to consider.
And lastly if you really think you need a financial way out of marriage (so soon?) there are pre-nuptual and post-nuptual agreements that legally specify who came into the marriage with what assets and who gets what in the event of a divorce or seperation. It is an insurance policy more for the people who have a lot of money than people like us that are average but it is possible for anyone to get one.