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WalletPrep worksheet · Life events

How should couples combine finances?

Name ____________________ Date __________

Key ideas

  1. There are three common ways to combine money. All joint, all separate, or a hybrid with one joint account for shared bills plus personal accounts.
  2. Split shared bills by share of income. Priya earns $4,000 of the couple's $6,500, so she pays $4,000 ÷ $6,500 of the $3,900 in bills, which is $2,400.
  3. Joint debt belongs to both of you. On a joint loan or a co-signed lease, each person can owe the whole amount, whatever you agreed between yourselves.

Vocabulary

Take-home pay
The money that actually lands in your bank account after taxes and payroll deductions come out of your paycheck.
Credit report
A record of your credit accounts, payments, balances and some public records, kept by each of the three credit bureaus.
Beneficiary
The person or group you name to receive an account, a trust or an insurance payout when you die.
Emergency fund
Cash set aside only for surprises like a job loss, a car repair or a medical bill. A common goal is 3 to 6 months of essential costs.
Authorized user
Someone a credit cardholder adds to their account so they can use the card. An authorized user generally doesn't owe the bill.
FDIC insurance
US government protection that repays your deposits if an insured bank fails, up to $250,000 per depositor, per bank, per ownership category.

Work it out

Priya and Marcus moved in together. Priya takes home $4,000 a month and Marcus $2,500. Their shared bills come to $3,900 a month.

  1. Priya's take-home
  2. Marcus's take-home
  3. Household take-home
  4. Priya's share
  5. Shared bills
  6. Priya pays
  7. Marcus pays

Check yourself

  1. Alex takes home $3,000 and Sam $2,000. Shared bills are $2,500. Using a proportional split, what does Alex pay?

    • A. $1,000
    • B. $1,250
    • C. $1,500
    • D. $2,000

  2. You and your partner take out a joint loan and agree to split it 50/50. Your partner stops paying. What do you owe?

    • A. Only your half
    • B. The whole amount
    • C. Nothing until the lender sues

  3. What happens to your credit reports when you get married?

    • A. They merge into one report
    • B. They stay separate
    • C. The higher score replaces the lower one

Your turn

Each of you writes down your take-home pay, debts and savings. Total your shared monthly bills, then work out each person's share of income and the dollar amount each would send to a joint account.

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Answer key

How should couples combine finances?

Work it out

  1. Priya's take-home$4,000
  2. Marcus's take-home$2,500
  3. Household take-home= $6,500
  4. Priya's share61.5%
  5. Shared bills$3,900
  6. Priya pays− $2,400
  7. Marcus pays= $1,500
  1. Priya's share is $4,000 ÷ $6,500 = 61.5%. Her part of the bills is $3,900 × $4,000 ÷ $6,500 = $2,400.
  2. Marcus pays $3,900 − $2,400 = $1,500, which is $2,500 ÷ $6,500 = 38.5% of the bills.
  3. Each keeps 40% of their pay: Priya $4,000 − $2,400 = $1,600, Marcus $2,500 − $1,500 = $1,000. A 50/50 split would leave Marcus only $550.

Check yourself

  1. C. $1,500 Alex's share is $3,000 ÷ $5,000 = 60%. $2,500 × 0.60 = $1,500.
  2. B. The whole amount Each co-borrower is responsible for the whole debt, whatever you agreed between yourselves.
  3. B. They stay separate Credit reports are individual. Only joint accounts show up on both reports.