How I Manage My Finances In My Marriage

Managing your money is easier than you think! Sure, no one wants to live on a budget, but if you can master the budget then you need to start managing your finances. I'll share with you how my wife and I manage our finances and hopefully give you some ideas on how you can learn to manage your finances as well.

What Is Managing?

Managing means that you are in control of your finances and not living paycheck-to-paycheck. Managing means that someone, if you are single this is you, has to be responsible for your finances. In my marriage, I am the manager of our finances. This means that it is my responsibility to execute the plans and strategies that my wife and I come up with as a team. Managing is not gatekeeping, and I'll talk about that later.

We Have A Joint Account

We have a joint account because we are a team. When my wife was working and earning a paycheck, everything was deposited into our joint account. From there we decided what we wanted to do with our income (Mine + hers). It doesn't matter who earns the most, or what percentage of income you provide, you get an equal say in what is done with the money and we don't do anything until we agree. My wife is the only one in her family that shares an account with her spouse, but she is also the only one who has financial freedom. I come from a family where joint accounts are the norm, but it is definitely flawed in how it is managed with the husband being more of the gatekeeper than the manager. This is why I was 100% transparent with my wife before we got married telling her how I wanted to do our finances. Based on what our jobs were at the time, I had a potential of earning almost 10 times the amount that she would be able to earn with her career. I didn't want a marriage where she felt that she had to work, nor did I want her to feel insugnificant because the amount of income that she brought in was less than mine. So what we did was we from day 1 added our incomes together and made that the amount of money we made. With made up numbers, say I made $55 / hour and she made $8 / hour. We both worked 40 hour weeks, so instead of me having $2,200 / week and her having $320 / week, we calculated our income as $63 / hour which was $2,520 / week. This made her transitioning to a full-time mom easier. She knows that even though she doesn't earn a paycheck anymore, she still owns every penny that I bring in. She knows that she has an equal say with how we are going to manage our finances and in building the goals for our future.

DO NOT BE A GATEKEEPER

I call it a gatekeeper, I don't know if that's even a good term for it, but I feel like it is. I grew up with a father who loves his wife. My brother loves his wife as well. However, both of them are gatekeepers when it comes to their finances with their wives. They think they are doing the right thing by taking care of their finances, but all decisions and all spending is dictated by them and not discussed as a team with their spouse. One of them has been the sole income provider and makes it known that he has brought in the money so he has the most say. Sure, he'll buy his wife some gifts and she is allowed to spend money, but she never really had a say in how they saved money, invested money, or anything other than "how much can I spend". The other makes less money than his wife, but has told her that she has to work in order to maintain their lifestyle. The main problem with that, is that their lifestyle is whatever he wants it to be. Sure, he does love his wife and does take care of her really well, but it's not an equal marriage when it comes to their finances. A LOT of people avoid joint accounts due to the fear of someone being a gatekeeper.

The Initial Meeting

When I first approached my wife about our finances she told me to just do it and let her know how much she could spend. I know why she said that, she was expecting me to be a gatekeeper. Little did she know, that I was nothing like she ever expected. I told her to forget about what she can spend now, let's come up with some financial goals first. So we sat down and she told me she wanted to free up enough money to go on at least 2 vacations per year. My first goal was to make sure that we could pay down our debt and be debt free within 10 years. We had credit card debt, a furniture loan, a personal loan, a loan for our air conditioners, a 2nd mortgage, 2 car loans, student loans, and a mortgage. Yeah... It was rough and our future looked bleak. How was I going to plan 2 vacations with all of that debt? Dave Ramsey would have told me that I can't do both... but he wasn't married to my wife either. So I told her I'd come up with a few plans and would get back to her. What I came up with was the weekly budget. You can read about the weekly budget.

Once I had the weekly budget concept, we started to make savings goals to pay down debt. We BLASTED through our debt extremely quickly, still want on 2 vacations a year, AND started investing our money. This is all without a salary increase, just a different way of managing our money. In fact, when we started this we had a salary decrease because my wife left her job to be a full time mom. We currently have paid off everything other than the student loans and the primary mortgage. However, the student loans will be gone within the next six months at the rate we are saving money with our weekly budget.

We did take Dave Ramsey's snowball effect and paid off our smallest debt first. Then used that money and applied to the next debt as well. But with the weekly budget we took our surplus and added it to the debt too. This turned into an avalanche of debt payoff even confusing our car loan company as to why I was sending in so many payments. We made the monthly payment, but every week we had a surplus we sent that in as a payment for the loan. They had a hard time keeping up, so if you have that issue you may need to save up your money for debt payoff and just add it to your monthly payment.

The Monthly Review

Every month we sit down as a couple and see how we are progressing to our goals, (saving for vacations and paying down a specific debt were ours). We see where we can refine our spending to help accomplish our goals, and we refine or redefine our goals during this meeting as well. We look over our finances and see if we need to adjust our weekly budget for the next month. This meeting is not only to make sure that we are aware of the progress, but also that we are on the same page with how we are going to use our money next month. For example, we used to put 100% of our weekly budget surplus into paying down debt. Now that we are almost completely out of debt, we only use 50% of our surplus to pay down debt. Why? Because we have worked really hard for years to get to this point and want to start investing money for our future instead of just focusing on paying off debt.

The Impromptu Review

If we ever feel like we are getting off track (a week of eating out every meal for example...) we have an impromptu review to make sure we aren't taking away from our financial goals. These don't replace the monthly review, but they are good to have when we need them. This is almost 100% my wife wanting to know more details about how she is doing towards reaching our savings goals. I watch our finances on the daily, but hers is more difficult. Her financial contribution is in saving money, and that can be hard to keep track of. I showed her last year how she cut spending by almost 100% by buying Christmas presents within our weekly budget instead of relying on my Christmas bonus to pay for everything. So when my Christmas bonus got paid out, almost 100% went to paying off debt. That was a huge victory for both of us. We did spend a little to celebrate that!

We Both Can't Be Managers

We can't both manage, because when both are responsible it gets messy. So what we do is make sure that I am the sole person in our marriage that executes the plans, makes the payments, and invests our money. I am investing where we agreed, I am paying off the debt that we both agreed, and I am executing the financial plans that we agreed upon as a team. Just because I am managing the money, doesn't mean that I get to dictate where anything goes. Yes, I frequently trade stocks / crypto that my wife doesn't know about. However, she knows exactly how much money we have in those accounts and knows how much money we have decided I have to invest. I literally started with $60 to actively invest with at the beginning of this year and have turned it into over $4,000 so far. I got lucky on a couple of options trades and some crypto. So she knows about that account and knows that I am still actively investing that tiny amount. Our main investment accounts I don't actively manage.

Finances Should Be Freeing

If managing our money wasn't freeing us up to live our best life, then we are doing it wrong. When we first started and had tons of debt it was very rough denying ourselves of things that others didn't. However, looking back over the last 5 years the people that were living lavish lifestyles are all living paycheck-to-paycheck while we are able to invest, go on vacations, and are able to afford more in life. They spent everything they made and more thinking it was all good. However, their debt has snowballed and they are struggling to survive. Unfortunately none of them are willing to take advice from us, even though we were in the same situation they were 5 years earlier. Several have asked me how they can do what we did, and when I tell them how we started using a budget I lost them. No one I know wants to live on a budget and aren't willing to do the work to get out of debt. However, they want the freedom that my wife and I have. The funny thing is, we are on a budget.