Financial Tips For Unmarried Couples

Unmarried couples need a system for managing their money. Basically, there is no right or wrong way to do it. It is important that each couple finds their own individual way to bear all the costs together. Taking out a loan should also be decided jointly by both parties. There are often arguments about finances.

However, this can be avoided if these important things are clarified when you move in. The optimal solution depends on various factors. So it depends on the earnings of both partners, whether children have to be taken care of and how much financial independence you want to keep.

There are no legal restrictions on account management. Unmarried couples can hold individual accounts or open a joint account.

Open A Joint Account Or Keep Separate Accounts 

This question arises as soon as a unmarried couple move into the shared apartment. As a rule, both partners have their own account that runs in their name. Salary payments are received there, as are child benefits, maintenance and other benefits. The question is whether these accounts should continue or whether a joint account should be opened. As an alternative, both are also possible.

All variants have advantages and disadvantages. With a joint account, all expenses can be denied simply by dbudget.g. Everyone has their own card for purchases and everyone can have their own account. A certain leap of faith must be given for this solution. In addition, such an account is only fair if both earn about the same. There are also disadvantages that both partners should be aware of:

1. Giving up financial independence.
2. Garnishments affect the income of both account holders.
3. One partner can dispose of the credit without the knowledge of the other.

The continuation of the individual accounts that were used before the partnership makes sense if one partner earns significantly more or one of them has debts. However, this variant also has disadvantages:

1. Bank charges apply for two accounts.
2. the overview of income and expenses is more difficult.
3. A solution must be found for the shared budget.

The additional opening of a joint account can be recommended. Both partners can deposit money into this, which is used for the joint costs. If each affiliate deposits the same amount, the cost can easily be shared fairly.

Taking Out A Loan Together

If money is needed,unmarried couples may consider taking out a loan. If the financial circumstances allow, a loan can bridge financial bottlenecks or provide the funds for necessary purchases. It is important that both partners are registered as borrowers. So both are responsible for the repayment. However, it should be noted that both partners are listed as joint and several debtors. This means that if one partner becomes insolvent, the other partner has to repay the loan alone. If there is a separation, this often becomes a problem, because the bank can turn to the financially stronger borrower with its repayment request.

Avoid Arguments About Money 

Disputes about financial issues can be avoided if the partners decide at the beginning of their life together how they want to manage their finances together. It is helpful to put the agreements made in writing. If the financial circumstances change because a partner loses his job, because he is ill or because a baby is born, it is important that new agreements are made. If both partners stick to it, arguments can be avoided very well.