Money and Family

We’re back! Tackling your finances is a huge undertaking and can be a lot to untangle. What makes it simultaneously harder and easier is adding another person to the mix. Establishing, maintaining, and reworking finances along with a partner is an act of trust and compromise. Having someone by your side can add income and help you stay focused and break up the workload. On the other hand, it also adds a whole other lifetime of credit, debt, and spending habits that will somehow have to weave in to yours. And we haven’t even gotten to kids!

In this post we’d talk about how budgeting and finances change with a partner or family, and how to best prepare yourself.

Love and Money

Anyone who’s been in a relationship will tell you that things change from when you’re single to when you’re with someone – how you spend your time, how you spend your money, and how you think about your future can all be affected. These changes can be accelerated when you’re serious about someone and are considering marriage. And, just as you talk about the future of your personal relationship with your partner, you should also have clear lines of communication open about your financial relationship too.

How a Relationship Changes Your Spending Habits

Sixty-nine percent of people report that they spend more money when they’re in a relationship than when they’re single. If you’re not prepared for this, it can throw your previously good spending habits out of whack and leave you wondering where all your income went. We’re not saying that you shouldn’t spend money with your sweetie, but when you’re in the throws of love it can be too easy to say yes to purchases that single-you wouldn’t even consider. 

Luckily, this proclivity towards increasing our spending tends to diminish the longer we’re with someone and the older we get, but even then we still spend more on average when we’re coupled. Knowing this ahead of time and being proactive about budgeting and our finances can make all the difference in creating a financially stable relationship.

Much of this comes down to our ingrained beliefs on what a “good” relationship looks like. Just like our  experiences with our families and cultures shape our personal views towards money, these things also shape our view toward what a “healthy” relationship looks like. Think back to your experience growing up. Was love shown through gifts? Was money a positive or negative thing? Was “quality time” spent doing free or low cost activities, or was money required? It can be helpful to do this personal detective work before getting into a serious relationship so we’re better equipped to understand our impulses and tendencies when we’re in one. 

We’re gonna start by jumping in to the biggest relationship step there is – marriage. 

Getting Married 

For the purposes of this post, we’ll talk about marriage not only in the capacity of two people committing their lives together, but also of the legal implications that marriage brings with it. We know that many committed, stable relationships look a lot like marriage, but not in the eyes of the law such as a domestic partnership or common law marriage. While we don’t dismiss these (or any other arrangement between consenting, loving adults), we will stick to the financial implications of legal marriage here.


It’s essential to be on the same page as your partner before getting married. This is true for all facets of your relationship, but one that’s often overlooked is finances. Couples can be hesitant to have frank discussions about money with their future spouse which can lead to trouble down the road. Below are some topics you’ll want to go over thoroughly with your fiancé before tying the knot (and ideally these conversations are happening way before you even get engaged). 

  • Financial goals: Your financial goals may look a little different when you’re single compared with being in a partnership. Make sure you cover the following topics:
    • Home: Do you want to rent or buy? How much do you ideally want to spend on a house? What kind of neighborhood do you see yourself living in?
    • Combining finances: How do you feel about this? Would you want to combine everything or just some things? Are there parts of your financial history you don’t want your partner to know about?
    • Financial philosophy: What is your general attitude toward money and savings? What are your short and long term goals?
    • Kids: Do you want kids? What timeline are you on for having them? Do you want them to go to private or public school? What kind of savings will you put away for them? Will one parent stay home with the kids, or will you both be working? 
    • Retirement: What age would you like to retire, and what do you want your retirement to look like? Do you already have retirement accounts or IRAs? Will you be combining them or keeping them separate?
    • Savings and spending: What are your general habits when it comes to saving and spending? Is it important to always have savings for emergencies? Do you rely on credit a lot?
    • Inlaws: This one can go overlooked, but it’s worth discussing. How holidays are handled with inlaws and family? Will you be expected to travel each year? Are gifts expected and for whom? Traveling for the holidays and buying gifts for each member of your new family can quickly add up to the thousands. 
  • Be upfront about cash flow and debt: Be completely honest about all cash flow before you legally bind yourself to another person. You should know your partner’s income, rough savings and investments, and all major debt (student loans, car loans, credit card, etc.). When you get married, what’s theirs is now yours – the good and the bad.
  • Split living expenses fairly: These days, it’s likely you’re already living together, but if not you’ll need to discuss how living expenses will be split up. This may mean doing equitably instead of equally if one partner makes significantly more than the other. 
  • Credit: Keep your own credit while also building credit as a couple. You can start joint accounts with your new partner, but you don’t want to merge everything. By keeping some bills in your name you are protecting your credit score, which will help you both out in the future. 
  • Trust: Two out of five people in a relationship claim they have committed “financial infidelity,” lying to or withholding information about a significant purchase or change in finances. This can lead to trouble for your joint financial future. If you are going to merge your finances, it can be helpful to set guidelines about what needs to be shared. For example, if one partner wants to spend over $500 on something, they’d need to discuss it with the other first.


The question about whether to merge your finances and to what extent is one of the most important topics to discuss. Note that the choices you make now early in your relationship can change as you grow and mature as a couple. 

In general, people save more money by merging their finances and getting married than staying single. There have been studies that show that single women compared with married women can pay as much as a million dollars more over their lifetime when all costs like taxes, housing, and healthcare are factored in. 

However, this doesn’t mean you have to merge all your finances. Many couples choose to each keep their own checking accounts, while opening a joint account that they both contribute to. This can make things like paying for utilities, mortgage, or groceries less complicated, but still leaves you with personal spending money. It all comes down to how much you trust the other and what your financial goals are as a couple. If you do decide to merge your finances, take the time to create a joint spending plan that you both agree on and is transparent to both partners.


Like it or not, married couples receive a lot of benefits in our society. Here are just a few ways being married can save you money:

  • Most people save thousands on taxes because of benefits given to married couples when filing.
  • A married person can make more in Social Security benefits because they are entitled to a portion of their spouse’s benefits  – even when they’re both alive. There are even instances where you can double dip from Social Security requesting both spousal and individual payouts.
  • Married couples see a significant reduction in health spending due to lower premiums and if both partners are working, being able to choose the better employer health plan.
  • Married couples see a significant reduction in housing expenses, not just by sharing costs, but also deductions available to families and homeowners.


While the benefits of marriage largely outweigh the drawbacks, they are still worth noting and should not be overlooked.

  • Your spouse’s previous debt becomes your debt. If one partner has great credit and the other has lousy credit, it might be prudent to keep your finances more or less separated until the partner with the lower credit score gets theirs up. By combining too quickly you could be handicapping both people. 
  • Equal rights to assets for joint accounts and joint investments also mean equal rights to the losses they incur either due to market decisions or by overspending. 


An undeniable fact about marriages is that a significant portion of them end in divorce. Without passing judgement on why it may happen, there are steps you’ll need to take to ensure your finances stay in order if you become divorced.

  • If you have kids, get on the same page with your ex about life and health insurance, child support, and college savings. Your kids will stay your kids regardless of whether you’re married. 
  • Make a new spending plan. Chances are you’ve gotten used to a lifestyle where you had two incomes. Accept that things will look different and that you’ll have to make financial adjustments.
  • Pursue spousal support if applicable. All states have different guidelines on spousal support (alimony), but its intention is to ease the transition from two incomes to one. This can be a great tool to help readjust your finances. 
  • Ask for help and look for programs or services that can supplement financial burdens like utility reductions or loan deferment.

Kids and Money

There’s no doubt about it – kids cost money! But, like any big life change, going in with open eyes can make a challenging experience seem more manageable. Kids will keep you busy, so start early with these financial tips and get systems in place now, so you won’t have to think about them as the wild and wonderful ride of parenthood begins. 


Yay! A baby! You’re in for a lot of unexpected and magical moments, but the one thing that doesn’t need to be unexpected are the costs associated with having a baby. Some estimates show that during its first year of life a baby can cost up to $21,000! Designate some of your time preparing for your new little one by focusing solely on finances, so when that baby comes you’ll be prepared.


The real answer is – it depends! It will come down to your current financial situation, how early you start saving and planning, and (sadly in the US) what your health insurance plan looks like.

  • Health insurance: Know what’s covered by your health plan – they vary wildly and you could have anywhere from $0 out-of-pocket expenses up to $5,000. Unfortunately in the US it’s up to the customers to dig this up and figure it all out. All routine maternity care and well-child visits should be 100% covered, but what counts as “routine” isn’t always what your doctors will recommend. Get to know your coverage intimately and ask about everything
  • Employment decisions
    • What will you do if you have to stop working earlier than you thought?
    • What will maternity and paternity leave cover? Do they only allow time off or do they supplement your income as well? Get in contact with your HR department right away to ensure you’re getting the most from your employer. All businesses with over 50 employees have to abide by the Family Medical Leave Act (FMLA) which requires 12 weeks standard maternity and paternity leave, but does not require you to be paid for it.
    • Can you use sick days? Some employers will let you use banked sick leave for added leave, and some won’t. 
    • What about doctor appointments? (There are a ton!) If you’re the pregnant one, count on going to the doctor at least once a month, and even more frequently when you get closer to your due date.
    • Are there part time work options if you can’t return to working full time? You may plan on returning to work after three months, but the reality might be different. Have a backup plan for different ways to earn some cash.
  • Life insurance: If you don’t already have life insurance now’s the time. Rates are generally low for young people so you’ll probably qualify for good coverage and low premiums.
  • Create a will: It may seem a bit morbid, but creating a will helps protect your assets and ensures all your hard work won’t be lost.
  • Child care: It’s not too early to start researching! The cost of child care in the US keeps going up, and in many major cities there are waitlists that can be over a year long. Do the legwork now so you’ll have more options.
  • Start a college fund: By starting a college fund now every dollar you put in will grow exponentially larger capitalizing on compound interest. Plus, it’s a great option for families to contribute to in lieu of (or in addition to) gifts for birthdays or holidays.


Adding a kid to the mix means you’ll need to rethink and reassess your spending plan. This may take some trial and error, but some major things to think about are below.

  • Practice beforehand: Before your first baby comes it can be helpful to practice living on less money in the months leading up to it. Having a baby in the house means a new way of life, but if you can minimize the impact of the new financial changes, you’ll be able to focus your energy where it really counts – on your new little one!   
  • Know that costs will change: Your child won’t be in diapers forever, and many of the expensive baby items you’ll purchase can be kept for future kids. That said, new costs will pop up to supplant the old ones. Pretty soon you’ll be paying for piano lessons and school supplies instead of formula and strollers. 
  • Summertime: Public education is a boon to working parents who can count on their kids being  supervised during the week, but what do you do during the summer and how will you pay for it? What will you do if both parents continue to work full time?
    • Summer camps: look into camps put on by community centers as these are typically lower in cost (or sometimes free) than private camps.
    • School based programs: Many schools continue providing programming throughout the summer and this can be a great way to keep kids busy, connected to friends, and allow you time to work.
    • Nanny shares and child care centers are options, but will all cost you money. If you know you’ll need full time care in the summer, make sure this is part of your budget.


Only 25% of high schools require a class in financial education to graduate, and research shows that kids who take these classes make better decisions about paying for college, take out lower interest rate federal loans to pay for it, and take on less credit card and consumer debt. You can’t count on schools to teach your kid what they need to know about finances, so you’ve got to do it. Believe it or not, there can be fun ways to do this too! Remember back to our first post when you thought about your own family experience with money? Was there anything you’d like to change about your experience? Now’s the time!

  • Brainstorm ideas to save money with your kids. You’ll be amazed at what they come up with and it makes them feel like a valuable part of the family.
  • Talk about ways to save on utilities and have them help out.
  • Make eating at home and cooking meals a family event. Many families see money fall through the cracks by eating out or ordering take out. If this is you (and no shame), start small by designating certain nights as family dinner nights. You can even have your kids find recipes and help cook. 
  • Talk to them honestly about your family’s finances, but in an age-appropriate way. Kids appreciate being told the truth, and they deserve to know the basics. You don’t have to tell them every detail but find ways to share the successes as well as setbacks.
  • Lead by example. Teaching explicitly is good, but showing them through your actions is even better. If you always tell your kids no to a candy bar but you get a fancy coffee every day that’s sending mixed messages.
  • Let them earn money when they’re old enough or find age-appropriate ways for them to earn and save and make their own spending plan and goals.

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