Photo: The New Paper

Couples often prefer to manage their money like how their parents did. However, a couple’s unique situation may require a style different from their parents’.

Here are seven ways of managing couple finances:

1. To each his own
Each person handles personal finances in separate accounts.

For example, Barry is a widower whose ex-wife had cancer. To pay for her medical expenses, Barry depleted his savings, borrowed heavily on his credit cards, and took personal loans. While paying off his debts, he enters into a new relationship with Iris. They want to buy a property together. However, Barry might be unable to take any loan, having maxed out his borrowing facilities. Barry and Iris keep their finances separate until his finances become healthier.

This also works when:
– One party’s finances are much more complex than the other, such as when there are multiple sources of income.
– One party has secrets to hide. mutual trust is lacking.
– Both parties spend money very differently or are unsure of their long-term commitment to each other.

What it requires:
– Simple financial planning.
– Sophisticated estate planning, due to individually owned assets.

2. What’s mine is yours
Combine all finances in joint accounts.

Young adults Harry and Gwen have been dating for years. They have similar personalities, hobbies, and life goals. They do almost everything together. Each cares deeply for the other’s family. As they make similar financial decisions, they decide to combine their resources in a single account.

This works when a couple:
– Want to seal their long-term commitment to each other.
– Have shared hobbies, combined financial goals, and straightforward finances.
– Are close to their families.
– Have mutual trust.

What it requires:
– Sophisticated financial planning.
– Simple estate planning with joint ownership of assets.
– Open communication about each other’s spending.

3. You’re my equal
Each person owns an account and contributes equally to a joint account.

In Diana’s family, the women are strong-willed. In Steve’s family, men make the decisions. Unable to agree on their money management, Diana and Steve hold separate accounts. However, they need to pay for their house and daily household needs. They pay for these expenses from a joint account to which they contribute equally.

This works when a couple has:
– Some combined financial goals, but want some independence.
– Roughly the same income.
– Moved in together and have shared household expenses or shared savings goals.

What it requires:
– Complex financial planning and estate planning.

4. I pay, you save
One person pays for everything. The other saves/invests all of his/her income.

Scott and Jean want to take up a full-time university course, but cannot do so simultaneously. They first accumulate savings, living on Scott’s earnings and saving all of Jean’s earnings. After building their savings and emergency fund, Jean goes for full-time study. By now, they are used to living on Scott’s salary. When Jean finishes her studies, she finds a job with income roughly equal to Scott’s salary. Scott then goes for his further studies.

This works when:
– One person earns much more than the other. 
– A couple goes single income in future, as it disciplines them to survive on one person’s income.

What it requires:
– An income replacement plan for the one whose income pays for all the family expenses, in case she or he becomes unable to work
– Family emergency fund.
– Disciplined spending.
– Budgeting for leisure.

5. The fair treatment
Each person contributes an amount proportionate to his/her income.

Henry, a scientist, earns a stable income. His wife Janet starts an interior design company. At first her projects are intermittent. Some months she earns nothing. Hank contributes more to their shared account. Janet contributes when she can. When Janet’s business flourishes, she takes over contributing more to pay for their shared expenses.

This works when:
– One person’s income is much higher than the other’s, and he/she is uncomfortable with the other contributing the same amount.
– Both have different lifestyles.
– One party is switching career, or starting a business.

6. Pay as you use
Each person pays for the products/services that he/she use more.

Peter is a photojournalist. Mary-Jane is a fashion model. To look her best, she uses beauty products and services. She pays for their magazine subscriptions, including her beauty magazines and Peter’s photography journals. Peter buys cameras, lenses, computers, and photo-editing software. He pays for the family computer and related online services.

This works when one partner:
– Does not want to pay for the other’s hobby.
– Has an expensive hobby, like shopping, collecting luxury items, travel or uses a household service much more than the other, such as internet, cable TV, or garden services.

7. The Japanese method
One person holds all the money and gives the other an allowance.

Clark comes from a rural Indian village. He came to Singapore to work in a tech company. His wife Lois, a homemaker, grew up in Mumbai and immigrated to Singapore. Knowing little about finances, Clark gives his monthly salary to Lois who makes the financial decisions. Lois gives Clark a monthly allowance.

This is useful when only one party knows how to manage money.

– If the one managing the money becomes unable to do so, the other could be at a loss as to what to do.
– If the breadwinner manages the money, the other might feel a power imbalance in the relationship.

What it requires:
– An income replacement plan for the breadwinner, in case he or she becomes unable to work.
– Family emergency fund.
– Insurance for the non income earner because if he or she falls ill, becomes disabled or gets into an accident, the breadwinner may have to pay for others to look after the children and household or take time off and a pay cut to do it.

Each couple has to decide which method best suits their preference and situation. A couple does not have to stick with one way all the way, because situations change.

In addition, couples should seek the advice of a holistic financial planner to optimise their assets.

This article first appeared in, and on Asiaone on January 31, 2016.

Daniel Tay founded Master Money Management to provide holistic fee-based financial planning. He is listed on, a platform that helps users with their personal finance issues. helps you with your personal finance issues — ask them a question anonymously, or connect with a financial consultant.