When is the right time to combine finances with your partner?

It isn't always obvious

When it comes to money, people can get… well funny and your partner isn’t always an exception.

Money can be so ‘funny’ in fact, that it is one of the biggest reasons relationships fail says the founder of Ladies Finance Club Molly Benjamin.

“It can feel vulnerable – especially if one of you has debt or different spending habits, and quite often spenders end up with savers. But opening up these conversations builds transparency and strengthens your relationship. Plus, research shows that couples who talk about money are happier,” she says.

Getting aligned on your finances is key to avoiding misunderstandings and stress and one aspect of this is whether to combine finances.

But like most things in life, there is no one way forward or easy answer, with new research by Money.com.au finding that there are generational differences around when is best to combine finances with your partner.

The research shows that Gen X waits the longest — around four years — to combine finances with a partner, Millennials follow closely at 3.7 years, Gen Z at 3.3 years, and Boomers typically combine finances after just two years. Interestingly, the survey also found that 34 per cent of couples join finances after moving in together, 30 per cent wait until marriage, and 28 per cent choose to keep finances separate, even if they’re living together or married.

Relationship coach Sallyanne Hartnell says the three-year mark is often the ‘sweet spot’ where couples begin to feel they’re truly in it for the long haul.

“This is when couples begin to see their relationship as more than a passing romance. By this point, they’ve moved past the ‘honeymoon phase’ and may want to make a statement of commitment. Merging finances becomes a meaningful way to say, ‘we’re building a future together,’” she says.

However, from a financial perspective, when it comes to deciding whether to say “I do” to joint finances, Benjamin says there’s no one-size-fits-all answer.

“The ideal time to combine finances often depends on your relationship stage, life circumstances, and comfort level. For example, someone entering a second marriage or recovering from financial abuse might prefer to keep finances separate – and that’s totally fine. Communication is key in finding what works best for both partners.”

Someone entering a second marriage or recovering from financial abuse might prefer to keep finances separate. Image: Pexels

And of course, it is important to weigh up the pros and cons.

Some positives:

• Builds trust and transparency in the relationship.
• Encourages teamwork on shared financial goals, like saving for a house or holiday – plus you can reach it faster!
• Simplifies managing joint expenses. 

And negatives:

• One partner might feel like they’re contributing more, leading to resentment.
• Spending styles can clash.
• Without clear communication, it can lead to conflict or even financial mismanagement.

One partner might feel like they’re contributing more, leading to resentment. Image: Pexels

The next step in deciding on whether or not to give the green light to combining finances, Benjamin says, is to have an open discussion around the following:

• Your financial styles: Are you both savers or is one a spender? 
• How much will you contribute? Will it be 50/50 or proportional to income?
• Spending rules: Will you agree on limits (e.g., anything over $250 needs joint approval)?
• Emergency funds: You should always keep individual Benjamin believes. 
• Future goals: What are you saving for together – house, holiday, or retirement, how much do you want to contribute to each?

If you opt to combine finances, Benjamin says there are ways to go about this that serve both parties.

#1. Start small: Open a joint account for shared bills and keep individual ‘fun’ accounts.

#2. Decide contributions: Use the 50/30/20 rule or split based on income.

#3. Set boundaries: Agree on spending rules and how you’ll handle big purchases.

#4. Communicate regularly: Have monthly money dates to review finances and goals.

#5. Keep personal independence: Maintain separate accounts for personal spending so neither of you feels guilty or restricted, you should never have to ask to spend your own money! 

Are you and your partner really on the same page when it comes to finances? Image: Pexels

But if you’re still unsure, Benjamin says despite your relationship status (married, defacto or otherwise) it is perfectly fine to keep your finances separate, especially in the following situations.

• To protect assets: If one partner has property or significant savings (if this is you look at getting a BFA Binding Financial Agreement 
• For independence: Some people feel more empowered managing their own money.
• If spending habits differ: A spender-saver dynamic might work better with separate accounts.
• In case of financial abuse: Having an independent account ensures safety if things go wrong. 

Originally published as When is the right time to combine finances with your partner?