How to Separate Your Finances
We’re all raised to believe that sharing is caring, and in a general sense, that’s a good lesson to live by. In a kindergarten classroom, sharing is almost always a solid plan—not only are there a limited number of resources, sharing is a great way to learn the importance of working together and helps practice patience and compassion. However, real life is rarely like a kindergarten classroom. And that’s unfortunate, because the world would be a better place if everyone had a nap, story time, and recess daily. Sometimes keeping separate finances in a relationship becomes necessary for a wide range of reasons, and not all of those are negative. Whether you’re keeping separate finances as a couple in an effort to keep the peace or separating your finances to prepare for a new independent beginning, un-sharing can serve as yet another good lesson in the importance of working together, even if you’re moving forward separately. How to Separate Finances as a Couple“Happily ever after” doesn’t have to follow one set path. Maybe your happily ever after involves not having conversations about how much you spent on video games this month or why the stuff you bought at Target was essential. Maybe your happily ever after has evolved to enjoying your solitude as an individual instead of as half of a couple. The reason for keeping your money separate doesn’t matter, but creating a plan for separating your shared money is important. Let’s cover the two most likely scenarios when it comes to the decision to split up your money: Keeping Finances Separate in a RelationshipMoney can be an emotional subject and a significant source of stress. In some relationships, maintaining separate bank accounts and budgets ends up being the most financially responsible choice, but how do you do it fairly? Your best bet may be to keep separate accounts and budgets for personal use and spending money and to establish a shared budget and a joint account where you combine finances to pay household bills and save for shared long-term goals. So, let’s say that Jack and Jill tie the knot (because they love each other, sure, but also, because their names inspired so many hilarious wedding hashtag options.) Jill was the kindergartner who kept her pencil box pristinely organized and Jack was the kid who ate Play-doh. Their spending habits are reflective of those past behaviors (but Jack almost never eats Play-doh anymore.) To keep the peace, they do the following:
Read more about budgeting together with separate accounts. How to Deal with Finances During SeparationNow, let’s say that getting married because you had a clever idea for a wedding day hashtag doesn’t end up being a good idea and Jack and Jill decide to call it quits. Separating your finances during a break-up or prior to a divorce is a more daunting task—not only is it likely that both parties are emotional, but the decisions being made now could potentially have legal ramifications. Talk to your lawyer or financial advisor for the best advice, but here are some preliminary steps to consider:
Ready to build more control into a chaotic time? Try YNAB for free for 34-days and make as many budgets as you need with a supportive community along the way. Learn how to set up your budget with the Ultimate Get Started Guide. *This is meant for educational purposes and should not be interpreted as legal advice. The post How to Separate Your Finances appeared first on You Need A Budget. Via Finance http://www.rssmix.com/via Blogger http://shandradotson.blogspot.com/2021/10/how-to-separate-your-finances.html October 08, 2021 at 05:42AM
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