Marriage finance: Having joint plus separate accounts.

How couples manage their money.
Feb. 2 2011 3:46 AM

Separate/Together

Do couples who share some but not all of their money have a lot of hassle or the perfect compromise?

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Would couples like J.P. and Brendan, who don't have to stick tightly to a budget, put up with the discord of all their Sometime Sharer money discussions if they could marry legally in their home state of California? Brendan says that if they could get married, he would consider merging more money, while J.P. isn't sure whether their money management system would change much. As it is, since they can't marry, they don't have the legal protections that married couples have, like equitable distribution of wealth upon divorce, if they combined all of their money and then broke up. (They also don't get most of the tax or insurance breaks that married couples get, as the New York Times pointed out in this thorough and depressing assessment of the lifetime cost of being a gay couple.)

All of this may help explain why more than half of the unmarried gay men who took my survey had a Sometime Sharer system of shared and individual accounts, while 34 percent of them kept everything separate, and 18 percent had a Common Pot. By way of comparison, only 28 percent of straight unmarried people used a Sometime Sharer system, while a full 54 percent kept everything separate, and 18 percent used a Common Pot. Meanwhile, 37 percent of unwed lesbians used the Sometime Sharer method, with 37 percent keeping everything separate and 26 percent using a Common Pot.

How much couples share, by sexual orientation graphic.

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Maybe gay couples are more likely than straight couples to pool some money when they're not married because for them, it's a stand-in for the marriage certificate they can't get in most states—a way to make a statement of togetherness and to feel emotionally married. J.P. and Brendan say that buying a house together was a game-changer that cemented their relationship, and they signed a contract saying they would both pay 50 percent of the mortgage. Swap house contract for marriage contract, and you'd have the more typical straight impetus for pooling funds. For Jack, 57, who has been with his partner Jim, 59, for 30 years (names changed by request), combining finances was "as symbolic a joining as the rings we gave one another on our fifth anniversary." (They live in Massachusetts and so did get to marry, finally, in 2004.)

Some unmarried straight couples use the Sometime Sharer method to signal the next step in a relationship, too. Sarah, 34, who has been with her boyfriend for more than seven years, says that he recently told her that he felt as if they weren't really partners unless they started a joint checking account. She was initially against it, but was convinced because, "He's not really a sentimental person," Sarah says, but he was "so sincere" about how the joint account would make him feel more like a real couple that she was moved. After Mike and I got married, I felt a bit like Sarah's boyfriend: Continuing to keep everything separate made our relationship feel slightly less substantial. I had promised to share my whole life with my husband, wearing a floofy white dress in front of 200 people—shouldn't some of our money be part of that bargain?

The How-To Part: Managing Sometime Sharer Accounts

When you decide to start merging accounts, you need to figure out what constitutes a shared expense. Brendan and J.P. created several categories of recurring expenses in an Excel sheet including groceries, restaurants, entertainment, utilities, and payment for their housekeeper (as noted above, their mortgage is a shared expense but divided differently). They track their money throughout the month using the personal finance Web site Yodlee.com.

One-off purchases are discussed on a case-by-case basis. For example, J.P. and Brendan decided that the plane tickets they purchased to visit Brendan's family for the Christmas holidays should be paid for out of the joint account. Another couple, Deb and Brett, recently decided that Deb's maternity clothes should come out of their joint account. "Brett told me to use the house account since it's not just frivolous clothes shopping. It's something that I needed because of a decision that we both made," Deb explains.

Like J.P. and Brendan, the majority of Sometime Sharer couples I spoke to deposited their salaries into individual accounts and then put a set amount into a joint account. But there were a few couples who did it the other way around: They funneled their salaries into joint accounts, then deposited a set amount into individual accounts as a sort of allowance. This is how Melanie, a 28-year-old administrative assistant, and David, also 28, who works at a nonprofit, handle their money.