One of my closest friends at my last job was consequently old enough to be my mother. One day we were talking about finances and I told her that my husband and I keep our finances separate. She had to pause and think about that- she hadn’t considered it before. The Bank of America 2018 Better Money Habits Millennial Report confirmed what we discovered that day- millennials are more likely than Gen Xers and Baby Boomers to keep their finances separate: 28% of millennial couples keep their finances separate, compared to 11% of Gen Xers and 13% of Baby Boomers.
When my husband and I first moved in together, we were still dating and our financial situations were very different. He had just gotten his first job after college making a decent salary and I was living off of student loans while I went to graduate school full time. We got joint checking and savings accounts for shared expenses (rent, bills and utilities, furniture, the dog, etc.) but decided very firmly not to share our disposable income. Here’s why:
We both work full time. Neither of us depends on the other for financial support outside of our shared expenses, so we’re able to keep things separate. If one of us didn’t work it would obviously change our entire financial dynamic.
We have a lot of debt. It’s the “good” kind of debt (student loans), but we each came into our relationship with our own and see no reason to take responsibility for each other’s debt.
Freedom. If either one of us wants to go out and buy some absurdly expensive thing, there’s no need to discuss it or run it by anyone. Further, we have the ability to decide to save our own money, pay down debt, or spend with abandon without needing to worry about how it will affect each other. So long as our shared bills are paid each month, we’re not particularly interested in how the other’s money is spent.
There’s nothing to hide. Since I spend my own money, I don’t need to stash things in the trunk of the car or fret about him seeing the credit card statement. Likewise, I don’t need to worry about his spending or our bank account balance. If either one of us spends a bunch of money in a month it doesn’t affect the other.
It forces us to communicate. The Better Money Habits Millennial Report also found that finances are the top source of tension in millennial households and we make it a point to openly discuss all things related to money. While items that are clearly for one of us don’t get split, there are times when we’re not sure who will pay. In these situations, we have a discussion about it and figure it out. It encourages us to keep the lines of communication about our finances open.
While there are still a lot of millennials who don’t share disposable income, this is the way that makes the most sense for us. We’re able to stay financially independent without having to worry about how what we do might affect the financial standing of the other.
How do you and your partner handle your finances? Let me know on Twitter– I’d love to hear more about your situation.