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I make $3,000 a month and pay about $1,900 worth of bills. She makes $900 a month and pays about $400 worth of bills. Not completely fair to me %-wise, but it works for now.
The short answer is that you and your husband will have to come up with the answer.
In my opinion, you have to either pool everything or be totally separate. For me & my husband, the answer was separate finances and big pre-nuptial agreement. We each contribute a specific percentage of the mortgage into an account used only for that purpose. The percentage is proportional based on our respective incomes. Other expenses (utilities, food, etc.) are split evenly. Anything beyond that is up to the individual. We each pay our own share of vacations, for example. If a piece of furniture is purchased, it is purchased by one person and becomes forevermore the property of that person.
ETA: Never, ever NEVER get into a situation where one person knows the family financial details and the other one doesn't. NEVER.
I'm not sure what to do. As I have a job that gives a steady check twice a month. But my husband (and I) have a business, so those payments come in very sporadically. The clients pay every few months (they are sooooo slow). So I'm not sure how handle that money.
My income covers the bills, we sometimes have money leftover to put into savings from that.
But considering our incomes (and almost no debt, no mortgage yet and very little on a car left) I feel we should be saving more money. At the end of the year we put money into a sep and savings. But again it's such a small amount compared to how much we earn.
How do you do it when you have a business and the checks just come randomly throughout the year?
I used to use a budget, but I switched last year to a Cash flow diagram. Basically, I keep a running total in Excel of how much cash I have available and I update it every day. So I can predict how much money should be in my checking account in, say April 2009. This makes it easier to plan everything, including savings deposits.
I get regular payments, but I assume you invoice your clients, so you can put in your expected income on the due date for the invoices. The chart has been working well so far. I usually plan about a month or two in advance. What you will need if you use a spreadsheet are the following columns:
“initial cash balance” “income” “expenses’ “Total after Expenses”
I also have a date range and short descriptions of my expenses for each week. For instance, rent, repairs, utilities. You’ll need calculations for a couple of the fields. If you need help, feel free to PM me.
I have a line for each week. For each week, the “initial cash balance” will be the “Total After Expenses” for the previous week. I can predict times when I will have an abundance of money or a shortfall. I can also determine when I need to curtail my spending, get more income or use credit.
If you do it correctly, you can see what effect spending an extra 1000 dollars on repairs this week will do to your cash flow by the end of February, for instance. You do have to have some idea of when your receivables are due, though. You can reduce the “randomness” of your income by having invoices with due dates and “dunning”/reminding your clients when they’re overdue and having late fees OR early payment discounts.
If you are a small-time businessperson, the cash-flow diagram may help.
I am 68 and my wife is 65. We have never had a budget. We have a joint checking account, and my wife keeps up with it. There have been a few times in our lifetime when my wife has said to me that we need to stop spending for a while.
That's how we've always done it too. We put all our money in one account and I pay the bills and then we buy whatever else we need from the same account, and if we need to not spend money for a while I let DH know.
Although we are going to start a new approach, where all our money goes into the account and then each of us gets money each week for lunches/discretionary spending so we don't keep dipping into the account everytime we want something. That's just a way of limiting how much "discretionary spending" we are doing so we can put more money toward debt and savings.
My dh isn't good with money, so I took charge of our finances right away, before we even got married.
All our $$ goes into one joint account, that I have charge of. I put some in my dh's account that he does not have to answer to me for, unless he asks for more (an amount we both agreed to ahead of time). Anytime "extra" funds come in, we talk about it and decide what we want to do with it ahead of time, or in cases of "surprises", we decide together before any of it is touched. Then I make it happen. I used to keep a separate account for myself as well, but it got to be too much of a pain... I do all the shopping for the household anyway, and having to do a separate transaction when I buy myself a paperback seemed silly)
Now I use that separate account for emergency funds... I xfer half of what I give him into it. It's kind of like short term savings. When we were on vacation last spring break and the tire blew out, it was nice to just whip out that debit card and not have it interfere with the vacation budget! As my dh didn't realize I had that account... he was VERY happy! (And for the record, I wasn't hiding it, he just assumed that since I never used it, that I closed it. I didn't know he didn't know, but it is listed along with our other accounts and other things in my "in case something happens to me" fire safe box).
He has access to all our funds, but he learned early on (the hard way) that just because there's $1500 sitting in checking, doesn't mean that we have $1500 to spend (outstanding checks, bills waiting to be paid, etc). It was more of a problem when we were younger and every penny was being pinched. And back when he was in the Navy, it made no sense to pas the responsibilities back and forth.
This works for us.
PS BTW... all of our accounts are technically joint accounts, but we have designated one as "ours", one as "his" and one as "mine". Our savings are all combined.
Last edited by sskkc; 02-07-2009 at 10:15 AM..
Reason: add
So how do you divide the finances and budget when you are married?
By percentage based on income. If I make 65% of the income, I'll pay 65% of the bills. Each spouse with a separate individual bank account, and one communal account where communal money gets deposited. Bills to be paid from the communal account. Expenses are covered, and everyone has their "own" money.
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Luvin Cash Flow
