Miscellaneous spending is a big trigger for arguments in a marriage. It’s often difficult for two partners to agree on what to spend money on, and even more difficult to agree on how much hard earned cash should be allocated for miscellaneous purchases.
Since money problems can be attributed to the demise of many marriages, it makes sense to be sure you get it right! While there are lots of ways to budget- one size does not fit all. But, there is one trick that has helped Ryan and I as we have journeyed on the path to becoming debt free: his and her money.
When we got married, we agreed our finances should be joined as well. Our bank accounts merged as soon as we said “I do!” and we began tackling our debt.
We had already been fans of Dave Ramsey and had been working on becoming debt free prior to our vows. I had no debt other than the mortgage on my starter home, and Ryan was debt free except for school loans.
Being debt free was a huge goal for both of us, but we definitely brought varying spending habits into our union. I was more of a saver and Ryan was admittedly more of a spender.
We lacked common interests, so what we enjoyed spending money on was very different. Ryan liked going out to lunch and watching movies. I preferred clothes and buying things for the house.
We knew we had to have some guidelines in place to ensure we were not spending too much on miscellaneous items at the cost of becoming debt free.
After a few different approaches, we found the best solution for us was his and her money.
His and Her Money: How it Works
While the amount has varied with different seasons of our marriage, the basic premise is this:
- Agree on how much money can be attributed to miscellaneous purchases each month
- Give your partner free rein to spend his or her money on whatever they desire- no strings attached!
That’s it! The only rule is that each person must respect the boundary of the amount. If a purchase goes beyond the set amount, the purchase must be agreed upon as a couple or must be postponed until money can be saved up. This money can also be rolled over from month to month in the budget if there is a large purchase one partner wishes to make.
Why it Works
His and her money works because it allows for freedom within boundaries. Each person gets the freedom to spend their money on whatever they most desire, while still respecting the boundaries of the budget and supporting the larger goal of achieving financial stability.
And, because you cannot veto what the other person spends their money on, each partner gets to enjoy purchasing without the dread of hearing their spouse complain about their purchases.
His and Her Money: A Case Study
I worked with a couple who struggled with miscellaneous spending. She wanted to save and be more budget minded, but he enjoyed spending money on things that he was passionate about.
She wanted to work less (they both worked two jobs) so that she could spend more time at home with her young children, so it stressed her out that he would buy comic books and grab convenience items while he was out and about.
During our initial budget meeting, I introduced the concept of his and her money and they were willing to try it out. They both agreed to allocate $100/month for each of them.
He was free to purchase comics and coffees without repercussion, and she was happy that there was a cap on his monthly spending so that they could get ahead financially.
How Much Money Should You Allocate?
The amount of money you attribute to his and her money for miscellaneous spending is unique to each couple. No two budgets are the same, nor are two unions alike.
If you are living paycheck to paycheck and are unable to pay your bills, you might need to institute a no spending policy until you can figure out a plan to get some wiggle room in your monthly budget.
Need some help getting your financial goals on track? Check out these resources:
We have some wiggle room in the budget
If you already have room for miscellaneous spending, consider a couple of options:
1. Track your spending for a few months and see how much you currently spend on miscellaneous purchases. Agree to cut it by a percentage until your budget goals are met. This percentage could be comfortable (maybe 10-15%) or drastic (50% or more) depending on how quickly you’d like to achieve your long term goals.
2. Choose an amount that you feel would restrict your spending without complete deprivation. Stick with this amount for a month or two and then reassess once both parties have a chance to get a feel for the amount.
3. Choose a percentage of your take-home pay to attribute to miscellaneous spending, then halve it for each person.
Give His and Her Money a Try
If you’re tired of fighting with your spouse over money, or want to make more headway on your budget goals, consider giving this his and her money strategy a try. It will help you find common ground on miscellaneous spending while still providing the freedom to spend money on favorite things.
Interested in learning more about becoming debt-free? Check out our series on the benefits of becoming financially independent!