Navigating finances as a couple is one of the most important yet tricky aspects of a relationship. Whether you’re splitting the bill on date night or managing a joint mortgage, figuring out how to share and track expenses effectively can save you from unnecessary stress and financial arguments. In today’s world, with countless apps and tools at our disposal, managing shared expenses has never been easier—or more complicated, depending on how you approach it. This article explores the best methods, tools, and practices for couples to manage their finances together.
What is the best way to share expenses as a couple?
Sharing expenses as a couple isn’t just about splitting costs; it’s about finding a system that works for both partners. Different strategies work for different couples, depending on their income levels, spending habits, and long-term financial goals. Here are three common methods to consider:
- 50/50 Split: This approach is straightforward – each partner pays half of all shared expenses. This method works best when both partners have similar incomes.
- Proportional Income Split: For couples with different income levels, splitting expenses based on income proportion is often a fairer approach. For example, if Partner A earns 70% of the household income, they would cover 70% of the shared expenses.
- Designated Expenses: In this method, each partner takes responsibility for specific expenses. One might cover rent, while the other handles groceries and utilities. This method is particularly useful when one partner is better at managing certain types of expenses.
Consider celebrity couple Kristen Bell and Dax Shepard. They’ve been very open about how they manage their finances. Kristen, known for her frugality, and Dax, a self-proclaimed saver, prefer to split expenses based on what makes sense for each purchase rather than sticking to a rigid formula. This flexibility has helped them avoid financial disagreements and stay aligned in their financial goals.
Ultimately, the best way to share expenses depends on your unique circumstances and your unique relationship dynamic. The key thing is to discuss your preferences openly with your partner and choose a method that feels fair and sustainable for both.
How do I keep track of shared expenses?
Tracking shared expenses can be a daunting task if you don’t have a system in place. But the good news is that with the right approach, it can be straightforward and even enjoyable. Here are three of the most effective strategies:
- Create a Joint Account: A joint bank account is one of the simplest ways to manage shared expenses. Both partners contribute to the account, which is then used to pay for all shared costs. This method provides transparency and makes tracking expenses easier, as everything is in one place.
- Use Spreadsheets: For those who love a good spreadsheet, this old-school method can be highly effective. You can create a shared Google Sheet where both partners log their expenses. Include categories like rent, groceries, utilities, shopping, and entertainment, and update it regularly. This method is particularly useful for couples who want to be hands-on with their finances.
- Expense-Sharing Apps: There are numerous apps designed to help couples track their expenses (more on this in the next section). These apps often come with features like automatic expense tracking, split bills, and reminders for overdue payments.
According to a Reddit thread where couples discussed the best way to track expenses, one user shared how they and their partner use a combination of a joint account and a Google Sheet to manage their finances. They highlighted how this method helps them stay organized while also allowing them to track individual and shared expenses separately.
Whether you prefer using a joint account, spreadsheets, or apps, the key to effective expense tracking is consistency. Choose a method that suits your lifestyle and stick with it. That, ultimately, is key!
What’s the best app for couples tracking expenses?
In today’s digital age, there’s an app for almost everything – including tracking shared expenses. Here are some of the top apps designed specifically for couples:
- Splitwise: One of the most popular apps for splitting expenses, Splitwise allows you to track who owes what. It’s great for couples who frequently split bills or go out with friends. It keeps a running total of shared expenses, and you can settle up whenever it’s convenient.
- Goodbudget: Based on the envelope budgeting method, Goodbudget helps you allocate a portion of your income to different spending categories. It’s perfect for couples who want to manage their finances more intentionally.
- Venmo: While not exclusively for couples, Venmo is great for splitting expenses and paying each other back quickly. It’s especially useful if you prefer to keep your individual accounts but still need an easy way to manage shared costs.
The best app for you and your partner depends on your specific needs. Use the free trials to test out a few options and see which one best fits your lifestyle.
How do couples track finances?
Tracking finances as a couple isn’t just about managing day-to-day expenses; it’s also about setting and achieving long-term financial goals together. Here are three of my favorite ways couples can effectively track their finances:
- Regular Money Meetings: Set aside time each month to review your budget together. Discuss any upcoming expenses and financial goals, and adjust your budget as needed. This habit not only keeps you on track but also fosters open communication about money. Win-win!
- Use Budgeting Tools: Apps like YNAB (You Need A Budget) can be incredibly helpful for tracking all your finances in one place. These apps allow you to set budgets, track spending, and monitor progress toward your financial goals.
- Keep Emergency Funds: Make sure you both contribute to an emergency fund. This will help you cover unexpected expenses without throwing off your budget. An emergency fund is a critical part of financial security for any couple and is the first step on your ladder to financial independence.
A Reddit user from the same thread mentioned above shared how they and their partner started having monthly finance check-ins. They found that these meetings not only helped them stay on top of their budget but also improved their overall communication and reduced financial stress.
Overall, tracking finances together is essential for building a secure financial future. Regular check-ins and using the right tools can make this process easier and more effective.
How a prenup can help with planning out expenses as a married couple
Did you know that you can insert a clause into your prenup that discusses how you manage joint finances together as a couple while married? Yes, that’s right! You can actually put it in writing how you will manage expenses during the marriage. Whether you will have a joint bank account or separate accounts, and how expenses will be paid from the account(s). For example, if you have joint accounts, how will that joint account be contributed to and withdrawn from, and how will it be split up in a divorce, as well. This can help set excellent boundaries between a couple to ensure both spouses are on the same page as to money expectations while married.
Additional tips for managing finances as a couple
No matter where you are in your journey, the fact that you’re even here reading about how to best track your finances as a couple is something worth celebrating! So, cheers to you! Here are some extra tips to really fast-track your progress.
- Discuss Financial Goals Early On: Whether you’re saving for a house, planning a vacation, or just trying to stay out of debt, it’s important to align on financial and life goals early in the relationship.
- Consider a Prenup: A prenup can be a smart financial decision, especially if you or your partner has significant assets or debts. It helps clarify financial expectations from the start. (For example, with Ben and Jen’s recent split, everyone was speculating whether they had a prenup in place…Spoiler alert: they didn’t!).
- Don’t Avoid Money Talks: Money can be a sensitive topic, but avoiding it can lead to bigger issues down the road. Make it a point to discuss finances regularly, even when things are going well.
Managing finances and effectively tracking shared expenses as a couple requires open communication, regular planning, and the right tools. By approaching this together, you can build a strong financial foundation that supports your relationship and future goals.
The bottom line on tracking shared expenses with your partner
In conclusion, while tracking shared expenses might not be the most romantic thing to think about…it’s important. With a huge dash of open communication, a pinch of consistent effort, and a splash of the right tools, you can build a strong financial foundation that supports your relationship and your future goals. You can even utilize a prenup to set certain marital expenses expectations with your future spouse to ensure you and your boo are on the exact same page before tying the knot. By proactively managing your finances, you’re not just tracking expenses; you’re investing in a shared future built on trust, transparency, and mutual respect.
Laura Tynan is the founder of The Witch of Wall Street, a personal finance and investing community, where women are shown how to manage, multiply and manifest money, using simple strategies. Laura holds a BSc Hons in Finance, is a Chartered Accountant, and is certified in EFT Tapping, Breathwork, and RRT. She has been recognized by the Financial Times as a Top 20 Future Female Leader and by Yahoo! Finance as a Global Champion of Women in Business. She is a multi-award-winning speaker who has spoken at, and been featured in, Forbes. Laura hosts The Witch of Wall Street podcast and is the author of the personal finance and investing book for women, by the same name, which is available now on Amazon.
0 Comments