Money Matters | His, Hers, or Ours?

Managing money is hard.  Sharing money in a marriage can be even harder.  This week in our Money Matters series Enrico and Christina Chandler share the story of their journey towards taking control of their finances by blending their lives and money together.        

Enrico and Christina first crossed paths as strangers in a class at the University of South Carolina.  They noticed each other but nothing came of it – at least not immediately.  As fate would have it they would cross paths again 5 years later and strike up a conversation.  With a bit of help from a social media connection (Facebook to the rescue!), Enrico reached out to schedule a date….and the rest, as they say, is history.  Now after being married for five years the Chandlers are juggling full time jobs and a growing family, but are still able to hone in on the things that draw them together.  Enrico loves how Christina brings stability and logical thinking into their relationship, which helps him stay grounded.  While Christina loves Enrico’s drive to constantly improve himself as he strives to be the best husband, father, and person that he can be.

With a love story like this – strangers who barely noticed each other in a class only to reconnect years later and form a lasting marital bond – one might expect their finances to magically fall into place also, right? But truly connecting their finances and aligning them to shared goals proved to be a little more challenging than that.  Read on to see how Enrico and Christina faced some tough conversations and tough decisions,  but ultimately persevered to make shared money work for them….

When you first got married did you share all of the details about your financial picture with each other? Were there any big surprises either initially or that showed up later?

Yes, we knew of each other’s debts. But at the time we did not have a true financial plan and we were not concerned about that aspect of the marriage. Our goals focused more on living life and doing what made us immediately happy.  As long as all of the bills were paid and we were putting a little towards savings and retirement, we were not concerned as much about getting rid of debt or the future as much.  The surprise came over time when living life normally finally hit us with a reality check. We had student loan payments, car payments, credit card payments, and a new mortgage. We suddenly realized dreams of savings more, contributing more to retirement, and splurging more on ourselves were out of reach because we had no extra room in our budget. At this point we finally started the journey towards financial freedom and decided to get rid of all debt as soon as possible to free up our income.  It was surprising how much debt we actually had collectively, which was mostly student loans. 

 

Some people believe in the marriage philosophy of what’s yours is mine and what’s mine is yours, except when it comes to money and finances. When you first got married what was your approach to joint accounts and shared money?

We partially shared money. We had a joint checking account for shared bills (utilities, mortgage, etc.) and a joint savings account for emergencies and purchases that was allocated a set amount per check.  Also we had separate personal accounts for our own bills (car payments, student loans, credit cards, etc.)  and separate personal savings account that came from what was left from our individual checks.

 

Since you all initially only partially joined your money, what circumstances led you to fully integrate your finances?

At a point in our lives we looked up and saw that we had payments everywhere. We had a mortgage payment, student loan payments, credit card payments, and car payments. We wanted to get smarter financially and stop all of that money from leaving our pockets. We attended Dave Ramsey’s Financial Peace University (FPU) where not only did we learn how to make better money decisions; we learned a better way to handle our money. One of the key concepts was to get rid of the notion of “My” money and “Your” money. All money coming in is “OUR” money and it should be treated as such. With this in mind, we started pooling all of our income into a joint checking and savings account. We then paid ourselves a smaller equal amount per paycheck for personal expenses (e.g. haircuts, gifts, video games, etc.)

 

Since taking those steps to join your money do you find it easier to manage finances with combined accounts?

Yes, we have simplified things down to a bill paying account, an emergency fund account, and what we call a sink fund. The bill paying account is just that – all bills are automatically paid out of that account. At the end of each pay period that account goes to zero only to be refilled when we get paid again. The emergency fund is only for emergencies. The sink fund is to build up for irregular expenses that we know are going to happen at some point (e.g. car maintenance, taxes, Christmas, birthdays, HOA dues, etc.)

 

Sounds like it takes a lot of planning to set all of those accounts up and keep them running smoothly. How often do you all sit down and talk about finances together?

We’ve been focused on our finances for a while now, so everything is pretty much automated month to month. We have a budget already planned out for the year and make adjustments on the fly as they come in. Those adjustments are usually the times that we talk about finances and where we stand. This could be as simple as moving the budget around because some friends asked us to go out at the last minute or as complex as unexpected repairs that need to be done on the house.

 

Home repairs, car maintenance, and expenses for kids, are items that we all can identify with. When these type of unexpected expenses occur do you tend to make large financial decisions together? Or does one person take the lead?

Any large financial decision that wasn’t previously budgeted is discussed prior to making a decision. This is to make sure we have fully thought the decision through and made sure our feelings aren’t going on impulse. We want to make smart decisions that improve our financial life and not make it tougher and we find bouncing reasoning and consequences off of each other allows us to stay on track.

 

So, it seems like you have it all figured out (LOL), but that almost sounds too good to be true. Tell us about a time when you had a disagreement regarding someone spending too much money from the joint account?  How did you resolve the disagreement?

One time Christina came across a significant amount of extra income. Since I didn’t have as close of a tie to the source of this income as Christina did, it was very easy for me to come up with the original plan we have always had for any extra income – put it towards debt. Christina’s plan for the money was completely different, she wanted to just save it all for Ehren, our son. We had to actually talk out our reasoning behind our decisions to get a full understanding of where we were coming from. I wanted to put it all on debt to expedite us having more disposable income for saving, investing, and lifestyle. Christina wanted to save the money because of the principle of having Ehren know where the money originated from and the future impact and meaning it could have in his life. We both had very valid points, so we compromised and met in the middle and saved a portion and put the remainder towards debt.

 

Yes, there are always multiple things vying for our attention and our money. With that said, what’s your number one financial goal & how do you plan to stay focused in order to achieve it? 

Our number one long term financial goal is to become financially independent. Financial independence is important to us for a number of reasons:

  • It gives us the ability to not be dependent on having a traditional job
  • It gives us the freedom to do more things that we want to do instead of things we have to do
  • It allows us to have less stress resulting in more happiness within our marriage and family

Our plan to accomplish this involves a number of things that we plan to implement over time.

  • Become debt free so all of the money that was going towards other people can now be used to my ourselves wealthier
  • Have an emergency fund of 6 months that will only be used for emergencies.
  • Maxing out all Roth 401Ks and Roth IRAs retirement plans in good mutual funds.
  • Contribute significantly towards 529 plans for our kids so they don’t get set back financially by student loans
  • Beyond those steps we will additionally look to create passive income streams all while maintaining a debt free lifestyle.

 

You all have shared a lot about your journey towards joining your finances, can you tell us what’s the best thing that’s come out of having shared money? Are there any disadvantages to managing money this way?

Having shared money eliminates the feeling of being the “bread winner” in the family. Regardless if both spouses make equal amounts, make vastly different amounts, or only one works, at the end of the day there is only a shared account that is used to pay all bills. Both spouses should have equal say in what happens with the money and there should be full transparency with where the money goes since everyone has access to the account.

Before we started this plan we still had a car payment, student loan payments, and credit cards that we were paying individually. When we joined our finances we could then start to help each other with those payments. We started helping each other put more than the minimum payment on our payments from smallest to largest. I helped her pay off her credit card faster, she then helped me pay of my credit card, she helped me pay off my student loan, she helped me pay off my car, and now we are finishing off her student loan. We became free of credit card debt and car debt much faster together than we would have done individually.

The only small disadvantage we have come across is if we want to buy a surprise gift for each other, but we have gotten around that by saving up our own personal spending money over time.

 

Thinking back over the last five years, what’s the biggest thing you’ve learned about your spouse and their money habits since being married?

Enrico: When it comes to finances Christina is what we call a free spirit while I’m what we would call a nerd. She is comfortable not getting into the details of executing the budget, tracking payments, and planning the exact details of everything. While I take comfort in managing those details and staying on track. This dynamic helps balance the both of us, so I’m here to make sure Christina isn’t missing a bill payment and she’s here making sure our lives don’t just consist of paying bills and saving.

Christina: Over the course of our relationship, he has changed his habits in so many ways. But, I can say that he has become very motivated to become debt free and with that motivation I have noticed his willingness to sacrifice.

 

We’ve personally learned so much about merging and handling finances from talking with Enrico and Christina. The separate bill account and sink fund really piqued our interest and we’re thinking about giving it a try!

If you’ve learned anything or want to give a few financial tips, comment below—we’d love to hear from you.  Join us next week as we continue our Money Matters series!

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4 thoughts on “Money Matters | His, Hers, or Ours?

    1. Thank you so much for taking the time to read the post! Dave Ramsey’s financial concepts are truly eye opening and life changing!

  1. This was great 👍🏿 Unspoken Vows! Those questions and that couple,, Enrico and Christina, were so encouraging. Thanks you for this article and series.

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