JOINT FINANCES DON’T HAVE TO SUCK

So you've met the girl of your dreams and you're planning to move in together. Before you do, you'll want to sit down and have a good hard conversation about money. Finances are not only one of a partnership's biggest stressors, it's also a very complicated topic. For example, my wife and I have very incompatible financial perspectives. She likes to save, I like to spend. She keeps old things, I would prefer to get rid of them and replace with new ones. She worries a lot about retirement, I could care less. She invests in the stock market, I would rather invest in real estate. She feels good about saving for the future, I feel good about living in the moment, spending money on experiences and memories today. 

But there's good news! A lot of the financial expectations, and accompanying stress, a relationship can bring are a result of heterosexual programming (from a young age) and not relevant in lesbian coupledom. You can do things differently!

BALANCE

Women, on average, earn less than men (source: The Gender Pay Gap. As a result, a relationship with one woman and one man will be unbalanced when it comes to money. In many marriages, this imbalance leads to strife. In a Lesbian relationship, with two women, this imbalance is much less common. As well, without male privilege in the mix, there's less expectation on the part of one partner over the other when it comes to money.

INDEPENDANCE

In a hetero marriage, the woman is often much less independent than the man, and keeping money out of their hands ensures that this doesn't change any time soon. In a lesbian marriage, both partners have likely developed independence after years of living outside the patriarchy and this helps when it comes to talking about finances. 

MARRIAGE WITH A DIFFERENCE

In your relationship, you don't have to share all your money equally. One partner isn't expected to support the other. You don't have to have a joint expense account. And unless you're planning on starting a family together, you probably don't even need a joint savings account. Will you be married 40 or 50 years? Probably not. Three quarters of same sex marriages that end in divorce are lesbians. 

But is this a problem? Long-term monogamy was always a hetrosexual construct. Ten years is a good long marriage and likely includes some amazing moments.

How then, can you sort your finances as a lesbian couple? Here is a three step solution that's been working for my wife and I for the past six years.

STEP 1. WORK OUT THE PERCENTAGES

Sit down and list all the shared household expenses. These include Rent/Mortgage, House Insurance, Property Tax, Strata Fees, Hydro, Gas, Food, Dinners & Entertainment, Booze, Pets. Now agree on what percentage you each will pay of these expenses. It might not be 50-50!

For example, my wife has kids. So when they are with us, I pay 25% of food, wifi and netflix. However, because we are a couple, I pay 50% of our own dining out, booze, and our pet expenses. I also pay 50% of strata fees and insurance but 25% of hydro (do you know how many times teenagers shower? And sooooo long.)

How you work this out will depend on you and your new partner's living situation. Whether there are kids. Pets. Elderly parents. 

Also to consider is whether your partner earns significantly more, or less, than you. This might change the percentage share a bit.

This process is a good way to initiate tough conversations. Will you share each other's vehicle expenses? Medical, dental, personal entertainment items, etc. We don't share these but as a couple you might decide differently.

STEP 2. GET A CREDIT CARD

Get a family credit card with a big ceiling, and a copy for each partner. Agree to put all joint expenses on this card. Do not use cash, checks, or EFTs because they are much harder to track. Use the credit card.

There may be monthly or annual expenses that are not covered by credit card. For example, when I moved in with my wife, she already owned her house, and managed some things with her line of credit. These included house insurance, strata fees, utilities, etc. 

At the end of the month you'll sort all of this along with the credit card.

Do not use this card for personal expenses. Keep your own bank cards, and your own bank account.

STEP 3. MONTHLY RECONCILIATION

Every month, when the credit card statement comes in, figure out what your personal share of the expenses is and pay it right away. 

In our home, we have yellow highlighted items which I share at 50%, we have pink highlighted items which I share at 33% and blue highlighted items which I owe at 100%

I then do a tally, including all the other pieces such as Strata Fees and Property Tax, and I sum it up. My wife likes to use her line of credit to pay off the credit card (interest is lower) so  I send my wife an email with April Household 2021 as a subject line, and then I EFT her what I owe. 

Obviously, there are more aspects to couple finances than this kind of month-to-month activity. Borrowing from your partner, for example. The family car. Buying a house together. Settling finances in divorce. All big topics and worthy of further discussion.

As with all issues in a partnership, communication is key. By sitting down and talking about joint expenses and how you're going to divvy them up you'll be well on your way to a happy daily life, at least on the financial side of things. 

Written by Jude Goodwin

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