If you’re thinking about merging finances with your partner, then you need to be aware of several important decisions and steps you will have to make.

This is a big step for many couples, but by following some sensible guidelines you can combine your strengths in order to plan for the future and live a full life.

Be practical to reduce stress

A lot of people find managing their finances stressful, and conflicts over money are a common cause of relationship problems.

Merging finances doesn’t need to cause upset or worry, if you take a practical and open approach, especially if you have debt or other liabilities to manage.

If you are worried about the process, talk to your partner about it and ensure you are both ready to take this step. Some people feel pressure to have joint accounts or to keep their incomes separate, and your situation will be unique to you.

If you aren’t sure, get advice from your bank or from an independent financial adviser. They will be able to help you come the right decision for you both.

Set clear goals

Perhaps the most important part of the process of merging finances is knowing what you both want to achieve. Regardless of your income or debt levels, disagreement over how to use your financial resources can cause long-term problems

When you have decided to merge your finances, sit down and discuss what you both want to achieve, and try to identify goals which matter to you as individuals. It’s fine to want some different things, as long as you have a way to manage that.

Remember that you may need to make and seek compromise.

Starting point

Once you have decided on your goals, you are ready to make a clear-eyed assessment of your current financial situation.

This includes your income, debts and assets, such as homes, vehicles and any investments. You will also need to assess your regular outgoings, such as food, rent or mortgage, and travel costs.

This process helps you to see whether you have enough to meet your basic shared needs, and whether you have a surplus each month.

Be particularly realistic about your income. Your career can take unexpected turns, such as if you have children or suffer ill health, so be cautious about assuming you will earn more in the long term.

Openness is vital when merging finances

When it comes to merging finances with a partner, you have lots of reasons to be as open and honest as you can. You will be making important decisions together and they need to be underpinned by trust; finances aren’t just an optional extra bolted onto a relationship, they’re absolutely integral to it.

You also have to bear in mind the practical considerations. A good financial plan can be wrecked if it doesn’t allow for servicing a hidden debt, and this can cause serious financial problems.

Hiding your true income is also not wise. It can undermine trust, but also creates a legal risk if you or your partner fills out certain documents and makes an incorrect declaration about household income.

Create a realistic budget

Once you have identified your goals and your starting point, it’s time to start budgeting. One way to approach this is the three bucket method. You create a “bucket” for each of your major uses of money: surviving, saving and spending.

The survival bucket pays your household bills and anything that is a legal requirement, including debt servicing.

The savings bucket covers what you put away for retirement, or as emergency funds. It can also include reducing debts and saving for long-term goals like big holidays or a house deposit.

The spending bucket is for your immediate goals, living life, buying gifts and all the little expenses that crop up when you do things you enjoy.

Bucket ratios

You will find lots of advice about how to divide your money between these buckets, and probably the most simple is the 50-20-30 rule.

Your survival bucket should take up no more than 50 percent of your income; if it takes up more you should to look at ways of reducing those bills or increasing your income. The savings bucket should get about 20 percent of your income, and the spending gets 30%.

These ratios will need to change in different circumstances. A young family may require a bigger survival bucket, while an elderly retired couple are unlikely to still be saving 20 percent of their income.

Joint accounts

Moving to a joint account is a big step for any couple. It can make managing your money much simpler, but you both need to be comfortable with the decision.

You can open a new joint account, so you make a clean start and perhaps pick up some small incentives from banks looking for new business. Or you can add one person to the other’s account, which means you keep the history attached to that account. This can be useful when you apply for loans, especially a mortgage.

When you do make changes to your accounts, make sure you formalise it with the bank so both names and signatures are recorded. Keep the paperwork somewhere safe, so you both have access to it in case of emergencies where one of you is not available.


Overall, merging finances is an important step that can help you to realise your goals as a couple. Make sure you are honest, plan carefully and think clearly about what you want to do with your money.