Pitfall – Your Money, My Money, Our Money
Pitfall – Your Money, My Money, Our Money
Money pitfalls are things people do with money that has hidden dangers. Now we will look at the Idea that a couple should have your money, my money, and our money. The basic premise is both people are working so they keep their hard earned cash separate and use the pooled, our money, to pay needed expenses like housing. The espoused positives are that both people can fulfill their own goals, no need to communicate about money, less arguing over money because everyone is his/her own master. This form of money management is prevalent for gay money management because both people normally are more similarly situated and may have less trust from previous relationships. This money management style looks good and allows freedom – it’s a trap!
While these positive aspects may work for some they are playing a dangerous game that will become nasty when things do not go as planed. A joy of a relationship is being a team working to achieve a common goal. Your team of two to enjoy life and better it together. Because the couple is not sharing all the wealth for a common goal the couple is less of a team and more of housemates. The only common goals are to pay the monthly bills. What happens when one person gets disabled, fired, or looses the business? Does the other person have to resettingly pay up, let him/her sink in financial problems? Not having shared goals ruins the team structure and leaves him/her vulnerable to relationship problems when financial problems happen.
Communicating about money within the relationship is one of the best ways to avoid future money problems. A couple who does not communicate will not know what risks they are exposed to, like that 0% credit card coming due that he/she always forgets about. Further, one person may expose the couple to more risks, perhaps by starting a gambling habit. The couple does not need to include the other person in starting their own business, hobbies, retirement, safety net savings, and major purchases. These are all things which should be talked about and should be part of the shared goal or compromise. Can one person do something so reckless to get a lien placed on the house without consulting the other person? While talking about money may turn into arguing about money, sometimes arguing about the money before the house has a lien on it is a good thing. Sometimes conflict within the relationship is a good thing it keeps both parties honest on the goals and working together.
Not arguing over money is over rated if you are not talking about money. While a person may think that everyone being his/her own money master would prevent arguing, all it truly does it let cancerous money situations grow. If your spouse was going to start a crack habit, I hope you would argue over it to prevent him/her from snorting up. Same should go for bad money habits like gambling, crazy credit card shopping sprees, buying vehicles you cannot afford. You might say, “Well it is his/her money they earned it they can spend it how they wish”. If you are married the law treats all your, mine, and our money as the money of both of you. So if Spendthrift spends all of his/her money for 20 years and Tightwad saves all of his/her money for 20 years then divorce happens Tightwad just paid for all of Spendthrifts fun while receiving none in return. OR what happens if Tightwad retires very early compared to Spendthrift – hello resentment.
Normally couples who do this are trying to protect their earnings from the other person, when really it does not do that and can breed resentment. Further, normally these are petty amounts of cash that one person is trying to protect (less than 10K/year). Pick a person you can trust your money, life, and health to. I combine my income with my husband’s income there is a sizable income disparity between us, but we are a team. While I was in school he made more and we still pooled efforts towards our goals. Also, pooling funds I have become more invest in my husband doing better at work so he can make more, he is playing for our team.
Take away: While having separate funds may make the couple feel independent, the negatives of: lack of communication, lack of a team, ability to stop small problems small, and major problems with divorce and loss of income make this a pitfall you want to avoid before it gets you.
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