• Who Pays for What? 6 Couples Talk About Their Financial Setup at Home

    Financial trouble can sometimes be the reason for marital strife, unless you learn how to make it work like these couples do.
    by Maria Pilapil .
  • Who Pays for What? 6 Couples Talk About Their Financial Setup at Home
    IMAGE refusedcarfinance.com
  • Money cannot buy happiness -- in fact, financial trouble is sometimes the reason for marital strife and cause a lot of tension and problems between couples, if they allow it. So how do you avoid all the unnecessary stress? Be on the same page when it comes to your finances, be transparent, and tackle it as a team, just like what these couples do: 

    "We have an annual planning session, just like corporations do."
    EJ and Ginger Arboleda
     

    When they had the "money talk": A session during a Discovery Weekend prior to getting married. They discussed money arrangements (EJ takes care of all expenses, Ginger sets aside money for savings and investments) and what role money plays in their relationship. 

    Separate or joint accounts? 
    Ginger: Separate. Luckily, we have been able to stick to the agreement. Of course, we help each other out during times one needs funds for expenses. 

    Who manages the money? 
    EJ: I handle the day-to-day and Ginger handles the long-term investment goals. This arrangement works because, antiquated as it may sound, it makes me feel good to know that I am providing for my family. Ginger is also able to make a real contribution by taking care of our future. So we both feel invested and involved in our finances.
    Ginger: I think it's somewhat related to our personalities, too. EJ is a very efficient "tracker" -- nothing escapes him -- and I'm a very goal-oriented person. I love seeing our savings grow.

    How they come up with a budget: 
    Ginger: We do follow a budget. EJ is better at handling finances so he does all the budgeting. He sets aside money for different expenses that he places on an envelope. Other expenses, like groceries, are automatically debited from our debit card so that monitoring is easier. Big payments like amortization is paid via check so that everything is tracked more efficiently.
    EJ: We have an annual planning session, just like corporations do. We also use the envelope system.

    How to handle money as a couple:
    Ginger: Create a financial plan and DO talk about money. Never fight about it. 
    EJ: Ask yourself: why is it a struggle in the first place? Is what you bring in tied to your sense of self worth in the relationship? I've noticed that any BIG fight involving money is normally a symptom of something deeper. Look for those deeper issues, address those, and the money problems won't seem too big anymore. Start transitioning into an abundance mindset. If there is something you or your family wants, instead of asking, "how much should I save," start asking, "what can I do to afford it"? That change in perspective is empowering. 

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    "We base our budget on our needs, some tolerable wants, and our financial goals."
    MJ and Heidi A. 
     

    When they had the "money talk": Before getting married 

    Separate or joint accounts? 
    Heidi: We work with one budget, which I manage. We pool our income sources and that is where we get the money for our purchases.

    Who manages the money? 
    Heidi: We agreed from the very start to never quarrel over money issues. We agreed that I will be handling the finances and budget for the family, since handling money and filing things is something I do enjoy and my husband does not. 

    How they come up with a budget: 
    Heidi: We based it on our needs, some tolerable wants, and our financial goals. It’s a versatile arrangement. We just go with the flow. When we were decided that we wanted to start a family, we started a budget for it. And when the kids were toddlers, we started a budget for their education. We also don't hinder ourselves from enjoying our money, but we set a budget for it and try to stick to it.

    How to handle money as a couple: 
    Heidi: Communicate and be open to each other about the things you want and need. Don't expect your partner to be a mind reader when it comes to your monetary issues. Be respectful and sensitive to your partner's wants and needs. Be logical and practical -- don't get emotional when discussing these things. Both husband and wife should agree to a set budget to lessen misunderstandings. Agree that you will both stretch the family budget, because it is so hard to do that by yourself.

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    "We use an app to help us track and trend our monthly expenditures."
    Elijah and Joanna Mendoza 
     

    When they had the “money talk”: Before getting married 

    Separate or joint accounts? 
    Elijah: We initially agreed that I will take care of the finances, given that I have more experience. It made sense at first; however, we soon found out that it wasn't that simple. Today we handle our own finances. We agree on a division plan and change it as necessary, like if one of us gets a raise or if there are emergency expenses for the mid-term, like a relative needing financial assistance.

    Who manages the money? 
    Elijah: Whoever can manage a particular aspect better, he or she takes responsibility for it. For example, I take care of the Internet, because if a bill dispute arises, I could raise the issue easily. Having our own budgets allows us to still surprise each other with dates and gifts. It also gives us the flexibility to contribute to things that are outside of the family needs.

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    How they come up with a budget: 
    Elijah: We follow a budget guideline, but not necessarily a budget. For example, we don't limit our groceries to, say, P3,000/week. We buy what needs to be bought: if we need an LPG refill, we go ahead and buy even if there is "no budget" for it. It makes no sense to not do this because if we don't, we don't eat! We use an app called Expense Manager that helps us track and trend our monthly expenditures. After using it for a year, we already have a good idea of how our spending fluctuates from month to month.

    How to handle money as a couple: 
    Elijah: List things down. If you're not a millionaire with unlimited sources of funds, it's okay to micromanage. Try several methods. Each couple is different so you really need to know which one is right for you. 

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    "We always pay our credit card bills in full and on time to avoid penalties."

    Mitor and Kabbie Alipio 
     

    Separate or joint accounts? 
    Kabbie: Our agreement was simple: we both have access to our bank accounts, we both know each other's ATM passwords. All our funds are mutually owned.

    Who manages the money? 
    Kabbie: I handle the monthly bills because I'm obsessive-compulsive, and Mitor handles the investments because he's more knowledgeable on the subject. Given that he's been a real estate broker for the past ten years, he knows where to put our money best. 

    How they come up with a budget: 
    Kabbie: There's a ballpark figure, but we're not too strict about it, because you only live once! In short, if we know our sales are low this month, we will not go shopping for this and that. The most important thing is we always pay our credit card bills in full and on time to avoid penalties. We use our credit cards as much as possible so we can track where the money goes and take advantage of the points/miles. We also take advantage of 0% installment promos whenever we need to buy big-ticket items so that it's lighter on the pocket. We just make sure there's money to pay for anything we buy. 

    Mitor earns more so we use his account to pay for the major stuff--monthly payments of our properties, operating expenses such as phone bills, salary of our staff, gas, and food. And then I use the money we earn from leasing to pay for the small and fun stuff--utilities, shopping, and any expense for our child. Again, this is not strictly implemented. Bottomline is, we can use whatever account to pay for whatever.

    How to handle money as a couple:
    Kabbie: Be open. You are a team, so sharing the load for the bills shouldn't be such a burden. Know where you stand financially. Trust and respect for each other will really go a long way. 

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    "We came up with a realistic budget that we agreed to stick to."

    Andrew and Ann Chua 
     

    When they had the “money talk”: After getting married.

    Separate or joint accounts? 
    Ann: We are now managing our business together so I don't have my own income now. I normally just get an allowance from him for my personal expenses.

    Who manages the money? 
    Ann: I handle it, but the income comes from my husband. Bills get paid on time, we stick to the budget, and everything is done in a more orderly manner.  We both think this works well as Andrew feels responsible for his family's needs. We have two boys to raise and we want to set an example for them.

    How they come up with a budget: 
    Ann: The budget is determined by jotting down major expenses, like household needs, tuition fees, and monthly payroll for our staff. Basically my husband shoulders all our major expenses. For some minor expenses like eating out or small grocery purchases, I normally get from my allowance. 

    How to handle money as a couple: 
    Sit down and talk. Discuss current expenses and plans for the future, especially if you want to have kids later on. Talk about who’ll pay for the expenses and come up with a realistic budget that you'll both agree to stick to. 

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    "We opened bank accounts to efficiently allocate each of our funds."

    Arch Louie and Maria Diana O. 
     

    When they had the “money talk”: The day after they got engaged 

    Separate or joint accounts? 
    Everything goes into a pot, regardless of how much either of us makes, and that pot pays for everything. We trust each other and money does not define what value one brings to the relationship. There is transparency and it forces us to work as a team.

    Who manages the money? 
    Arch, because he’s a businessman and is more knowledgeable about finance and accounting.

    How they come up with a budget: 
    Arch: Our budget is a percentage of our combined income with adjustments, based on historical spending.
    Diana: We follow the Money Management System. We set aside funds for the following:
    • Necessities (55%) – for groceries, payroll of helpers, utilities, transportation (gas, parking, toll and public transportation / Grab), insurance and mortgage payments.
    • Financial Freedom Account (10%) – for business capitals, acquiring assets, purchasing stocks and anything that can help build our wealth.
    • Long term Savings for Spending (10%) – for our grand “wants” like car, furniture, gadgets, vacation, etc.
    • Education (10%) – Self-improvement is important for us, so we invest on “ourselves” as well. This includes buying books, attending seminars, learning a new language, etc. We tweaked this category a bit by adding Emergency and Health expenses too, like vitamins, medicines and doctor appointments. Basically, anything for personal growth and better quality of life.
    • Play (10%) – This is where we get the budget to “reward” ourselves, such as massages, pedicures, haircuts, movies, fancy restaurants, sports and meals with family / friends. 
    • Give (5%) – for donations, gifts and tips.
    The percentages per category may vary from time to time, like for instance, I just gave birth via c-section, so our medical expenses increased versus historical spending.

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    On top of all these, we also allocate monthly personal allowances. We are entitled to buy anything we want without “interrogating” each other. This is what we use to buy clothes, bags and shoes.

    Then we use an app called Home Budget to track and sync all the assets, interests, incomes, budgets and expenses. We tag each expense according to the categories we mentioned. 

    We also created a bank account per category to efficiently allocate the funds, and name each account accordingly. 

    How to handle money as a couple: Educate yourselves. There are different money management systems -- learn about them, discuss as a couple, then choose whatever works best for both of you. 

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