Family budgeting 2020
January 23, 2020 7:34 PM   Subscribe

We're your typical family with a couple parents and a couple kids, a mortgage, daycare costs, grocery / Target / Amazon purchases, and intermittent big items like vet bills and car repairs. What is the easiest way to make and track a budget?

Right now we have separate bank accounts and "domains" that we pay for: I pay the mortgage and daycare bills; he pays for the groceries, family Amazon needs, and intermittent stuff; and we each pay for our own cell phone, student loan, clothing, and random purchases (like a book on Amazon).

But that's not working well. While at one point it seemed even, now it seems imbalanced. We're missing out on e.g., the savings that a family cell phone plan could bring. And I'd like to start doing most of the grocery shopping.

What's a better approach to all of this? I'm open to things like Mint or YNAB, but my earlier attempts with them failed. With two young kids, I'm intimidated by solutions with high bookkeeping needs. Also, it seems like we might need more or different (shared?) bank accounts?

For those with fully integrated budgets, I have no idea how the emotional / relationship side of that works. I don't like the idea of having someone look over my shoulder on every expenditure or having to ask "where did all our money go?"

Please hit me with your budgeting tools and techniques! Thanks in advance for any suggestions you might have.
posted by slidell to Work & Money (18 answers total) 16 users marked this as a favorite
I don't like the idea of having someone look over my shoulder on every expenditure
Yours, Mine, and Ours - which means one joint account and two personal accounts. Each person puts a set amount into the joint account for joint expenses and keeps the rest of their pay in their own account. It can be different amounts if your earnings are not similar. Figure out how much each monthly cost is (plus a cushion) and split it between each of you.

This does require a weekly check on the account, at least. Banking apps make this easier now so you can just check on the balance each day and do a deep dive every week. Make it a weekly meeting with both parents.
There can be something one of you sees as a joint expense that the other disagrees with and that can be discussed at the meeting. This is a time for teamwork and not blame.
posted by soelo at 7:58 PM on January 23, 2020 [8 favorites]

We have a shared checking account, savings account, and credit card, as well as two separate personal checking accounts. We pay shared costs from the shared accounts and contribute a fixed amount per month to the shared savings account. We pay for most stuff on the credit card (cash rewards) and have all the regular bills that can't be paid out of the credit card paid from the shared checking account. I have a spreadsheet that projects all estimated future expenditures several months out, so if something unexpected comes up then I know whether I need to move money out of savings a few weeks/ months in advance. I know in general how much the credit card bill should be based on average monthly spending and keep track of our burn rate periodically to see how well we're doing spending-wise. It doesn't take too long to set this up if you have regular pay days and know about all your bills.

We are now in almost full household socialist mode, where all of the income goes to our shared accounts and we have only a little bit of money in personal accounts for personal purchases. This money comes to us from fix stipends that we get every week which are the same for both of us.

In the past, we had a model where individual pay went to individual accounts, then we had a shared checking account for household bills that was topped off by fixed deductions from individual accounts at regular intervals. That made more sense when our lives were less interdependent.

If you don't want to nitpick each other's spending, then definitely just keep your own accounts with your own money. I like not seeing what my husband is spending.
posted by _cave at 7:59 PM on January 23, 2020 [3 favorites]

i can’t address most of this, since I’m a single solo person who can afford to be rather relaxed about my budget but for

I don’t like the idea of having someone look over my shoulder on every expenditure

I am a grown adult who gives myself an allowance.

Every week, $100 goes to a special checking account, and that’s the card I use for my gas/groceries/entertainment. (I also carry a credit card for emergencies). If I don’t spend my whole allowance, it can accumulate for little splurges.

I’m lucky enough that my credit union doesn’t charge me per-account. This system has also benefited me in that if my card number is stolen (as it was recently), they can’t drain (even temporarily) the account I pay my bills out of.
posted by itesser at 8:01 PM on January 23, 2020 [3 favorites]

Thirding ours/mine/yours: we agree on what expenses are joint (mortgage, health insurance) and what are individual (hobbies) and we have three bank accounts accordingly.

Yeah, this takes a conversation every so often, and if neither of you like looking over the accounts regularly it helps a LOT for all the joint expenses to be predictable, so if $X goes in every month the bills will autopay without overdraft.

If you can bear to download a years' expenses and tally up what went into each category, you can work out X.

Other decisions: does each adult contribute half their income to X, and you budget from there; or each adult puts in half of X and keeps the rest of their income; or each adult *keeps* a fixed allowance and what's left over after X goes into joint savings. You might also like the Warrens' 50/30/20 framework.

We use YNAB, it's very slick, but a spreadsheet would do almost as much. I may set one up instead of renewing YNAB. ALso, I don't think YNAB does yours/mine/ours -- even though our *bank* does, each of us can see our joint account and our private account but not the other person's private account.
posted by clew at 8:08 PM on January 23, 2020 [1 favorite]

For those with fully integrated budgets, I have no idea how the emotional / relationship side of that works. I don't like the idea of having someone look over my shoulder on every expenditure or having to ask "where did all our money go?"

Ok, so we have separate accounts and a similar "I pay the mortgage, he pays the bills" kind of dynamic. I wanted to talk about the emotional stuff behind this that we worked out while we were doing premarital counselling- it has been nearly 3 years and we haven't got it perfect, but we have come a ways in exploring the emotions.

We both have bank accounts that were set up for us as kids, and so we don't want to join each other's accounts and lose our own. There's a funny kind of emotional attachment. We have default things coming out of those accounts that we'd need to update. (We want to get a joint account. But mrfeet hates the term 'allowance' and doesn't like the idea of being treated like a child. But we'll get there, I think. Maybe get a fancy offset account on our mortgage.)

But on spending: through our mortgage bank, we have the ability to import all our bank accounts and see the spending- they have a dinky budgeting feature, but it allows us to go through and categorise our spending, which it then remembers and gives us nice pie charts of the different categories. It was quite confronting when our biggest slice was not our mortgage but "takeaway and fast food"- we definitely shaped up! We are comfortable talking about what we spent money on, but ymmv. We tend to kind of leave it until inspiration strikes to comb through the data and figure out just how much we've been spending on KFC in the last 90 days. I admit that I'm the saver of the relationship, so it doesn't bug me to look at what we're spending. I think it does make mrfeet a bit uncomfortable, but we have a no-blame rule we try and follow - eg "so I'm not mad, but we (actually you, but I'm talking the broad category so it's not a targeted attack) spent $X on Y in the last Z. I think we could maybe adjust that, what do you think?" or "huh, we both could try taking packed lunches"

Another thing we did early on in the relationship was sit down and put our salaries in a spreadsheet, calculate our expenses (so once a year expenses x1, monthly expenses x12 etc) and tried to figure out what our average weekly expense was (so big stuff like car repairs are spread over the year) and compared to our weekly income, and adjusted things until there was some wiggle room. We have a rough idea of how much money is left over to spend each week.

Big Caveat- we are doing OK with money left over and savings, but we still haven't got a budget as such, and so take our advice with a big pinch of salt.

Emotions summary:
Find time to talk about it. If it's not a good time, ask when would be a good time and talk then instead.
Don't blame. Take the approach that you are both responsible.
Be understanding of different spending habits. (I'm a saver, my husband is more of a spender)
Talk about the emotions behind the positions on money.
Look at broad categories of spending, rather than individual purchases.
posted by freethefeet at 3:43 AM on January 24, 2020

Whatever system you decide on, involve your kids in it as they get older! There are so many taboos around discussing money, and a real lack of how to have healthy conversations around spending habits.
posted by basalganglia at 4:19 AM on January 24, 2020 [4 favorites]

Slate did a series (or just one article? Don't remember) a while ago about how various couples handled money in terms of combining versus separate. There have also been a number of threads on AskMefi. I'm team "joint everything, all money is shared" and have been since my husband and I got engaged, but I recognize that not everyone is comfortable with that. I think it has a ton of practical advantages in terms of daily life, but the whole "how to we approach money in our shared relationship" is a much, MUCH bigger question than the nuts-and-bolts "how do we work out who should pay $X and who should pay $Y?"
posted by Bebo at 5:13 AM on January 24, 2020 [4 favorites]

I'm divorced, so don't currently have to negotiate shared expenses with a spouse. But during my 18 year marriage we took the personal accounts plus shared account approach and all bills, etc, were paid from the joint account.

I currently use Quicken to track my finances and really like it. It downloads balances and transactions from bank accounts, credit cards, investment accounts. I can use it to schedule out recurring bills so I know when they're due (whether monthly, quarterly, yearly, or other). It's straightforward to categorize spending, and that makes it easy to review spending patterns.

If I were in your shoes, I would suggest this, to get a bird's eye view of family spending:

Keep the personal accounts. Agree on how much discretionary spending cash each adult gets every month so nobody feels micromanaged. Put the rest of your income in the joint account.

Hook the joint account up to Quicken or similar software, as well as whatever accounts you want to look at to get the global view of your family finances (investment, retirement, whatever.) You might consider designating a credit card for family expenses so it gets tracked, and a separate one for personal expenses so they don't.

.After three or six months you'll have a pretty good body of real life data and can start figuring out how to shift your expenses, or how to plan so you're not caught off guard by big yearly expenses (car insurance, whatever.)

Since I have this data in hand-- Every year I review the data of basic expenses (mortgage, utilities, car insurance, costco membership, termite protection, etc etc.), tally up what my total expenses are. I get paid twice a month, so I divide the total by 24 and put that amount in a "utilities and insurance" savings account each time I get paid. The amount in my checking account may rise and fall, but I find it reassuring to know that the dollars I need to keep the household running are present and accounted for. That approach might be reassuring to you too.
posted by Sublimity at 5:23 AM on January 24, 2020

We have a joint cell phone, car insurance, etc -- but also maintain separate checking accounts and credit cards. We sat down one day and made a list of all of our bills and decided which joint ones we would each take responsibility for and separated them that way. Since he makes more money than I do, he took a few little extras. This works best for us and has the entire time we have been together (15 years).

I have always been absolutely afraid of joining bank accounts and credit cards together because of the emotional situation that happens when couples fight over money. I can honestly say this isn't something we fight about.

We do have a joint savings account that we each contribute to everytime we get paid and we use that account for vacation savings or emergencies like car repairs, vet bills, etc.
posted by Sara_NOT_Sarah at 6:25 AM on January 24, 2020 [1 favorite]

Yes, we have joint accounts and "slush funds". The joint account is for rent / food / staying alive / things that benefit the household / kids, and is generally for purchases that you might need to justify. We do, by agreement, include things like haircuts and clothes in this - especially stuff that's needed to be presentable at work.

The slush funds get a smaller fixed amount auto-deposited each month, and are for personal expenses, going out with friends, and generally anything you don't want to be micromanaged about. We also agreed to include "buying lunch at work" out of this - that way I don't have to be annoyed if my husband buys a $20 lunch at a restaurant while I'm eating my $5 sandwich from the cafeteria, and it (in theory) incentivizes packing lunch, since that would come out of the grocery budget. Although in practice I'm too lazy. :)
posted by telepanda at 7:04 AM on January 24, 2020

I love the descriptor "full socialist" for a household!

I was absolutely STRICT about separate finances until literally the day after we got married, when we opened joint credit union accounts. We weren't super stressed about fairness before that, though, if that makes sense. Like, when we had separate finances before marriage we did basically what you do now. We did take turns paying for date night, but never kept track of totals spent on that.

Now, all money goes into the joint checking account, at which point it is divvied up in the following ways: bills are paid from that account (like...all of them...the only thing I can think of that is an individual recurring bill is my Lightroom subscription, and I think my husband might sometimes have game services he pays for individually)(we also have a joint credit card), joint savings is paid each pay period from that account, and then we each also get a weekly allowance to our individual accounts from that. We use allowance for purely frivolous individual fun things - like, I'm taking a solo weekend after an upcoming work trip, or my husband wants to buy a bunch of games, or I'd like to get Friday lunch from the food truck instead of packing it. We're not super strict on that, though, so sometimes upon mutual agreement we'll spend money from the joint account on something big that only one person will use, like a new computer or a recreational hobby class. Allowance just helps us keep the fun budget under control. And fun things for the entire household, like vacation or dinner out, come from the joint account. Clothes also come from the joint account, because you can't go naked outside. Basically, allowance is for stuff we don't feel like having to talk about, and the joint account is for stuff we have as routine expenses or we talk about and agree to spend money on. Also, debts we accrued individually are joint expenses - the car might be registered in my name, and my husband's student loans might have been accrued before we got married, but that stuff all gets paid from the joint pot of money.

We do talk about money regularly, but not in a fraught way, if that makes sense. Probably the closest thing we got to fraught was house buying, but even then that was just a lot of spreadsheets and tweaking of budget numbers and talking through what it would mean to have down payment x vs y, comparing various options for things, etc. On a normal weekly basis, it's more like "hey, is it okay if I spend $150 on new work clothes?" or "I just paid the mortgage, so assume we're $2000 down until the payment clears in the account in a couple of days" or "man, we spent a lot of money recently on XX, let's stay in this weekend". I'd say we talk about money a few times a week.

We just kind of share everything a lot. We only have one car, we're on the same insurance plan, we have a shared cell phone plan, and the only reason we have different names leading different bill accounts is so that we both have official mail coming to our address with our names on it for residence verification. Oh, and around Christmas/birthdays we have a sort of mutually agreed blindness to details in the credit card/bank statements, for surprise purposes.

Caveats: no kids, no pets, no complicated family obligations, we make similar amounts, and we both get paid a salary without regular commissions or bonuses or anything. Even then, we tend to put windfalls into the joint pool and decide collectively what to do with them. We even share birthday cash from our separate sets of parents on our separate birthdays. FULL SOCIALIST.
posted by bowtiesarecool at 8:05 AM on January 24, 2020

Gail Vaz Oxlade of Til Debt Do Us Part fame has all kinds of tools available on her website. Right now you can follow her on Twitter, as she is.doing a MoneyMasterClass, all year to get people on track
posted by Enid Lareg at 8:11 AM on January 24, 2020

My wife and I (both women, FWIW) have separate accounts but joint money, more or less. All the bills that aren't strictly hers (like her student loans and car) are in my or our name (the house is in both our names, but I think I never added her to the power bill, I should do that...) I pay them and she pays me once a month. We just have a round number that she pays me once a month plus she'll throw in more if we've been doing a lot of extras like concerts and stuff - and if that gets to be a lot, I'll explicitly keep track of what she owes me for that. I check that number occasionally to make sure we're not being unfair to someone. We have a joint cell plan (and our best friend is on it) etc.

This works for us because I have the more flexible job, so I run the errands most of the time but no one feels shorted. Each of our money is our own otherwise, so I don't eye her shoe collection and she doesn't question my books as long as the bills are paid. :) We talk about big purchases and make those decisions together, and generally split them, though sometimes (like when our TV died last year) she'll pick up bigger purchases, since she's got more money coming in. We take turns with going out to dinner and such.

We got married when we were older and both set in our ways. She's had bad bad bad experiences with previous partners and joint accounts; on the other hand, she has mental health issues that mean that when we got together, she said "hey, we need to not do joint accounts, because if my meds stop working and I drain them..." But we both also feel like it's OUR money, we both know if something big comes up we will handle it together, we shove money back and forth as we need to (everything's linked up so we can transfer money easily), etc. It's a porous system, and it works for us (double income, no kids, we're lucky that we make good money), and I tell this story as one example of how you can maintain different accounts without imbalance.

(I just use a spreadsheet to track expenses and pay bills. It works, though I'd like to start keeping a more granular eye on my money but I hate Mint so for now, the spreadsheet works.)
posted by joycehealy at 8:35 AM on January 24, 2020 [1 favorite]

My wife and I only have separate bank accounts. How our household works is we have a plastic envelope on the top of the fridge with a pen in it. When either of us spends money on our agreed shared categories (much like your splits -- we spend on our own clothes, phones, hobbies but split groceries, household goods and dining / entertainment done together) then we take the receipt and write our name on it, and shove it in the envelope.

Towards the end of the month, my wife totals up the receipts, plus adds in anything else without a receipt (big one - the rent). This is just sorting the receipts by person then writing the totals on the bills down in a Google doc. Our particular arrangement is that the rent is shared proportional to our incomes, and the other stuff is shared 50/50. She tells me how much I owe her (the rent comes out of her account, so I always owe her since it's our biggest shared expense). And then I do an e-transfer of the money I owe her. It takes her about 15-20 minutes a month. This is all we need to do to split our expenses in the way we feel is fair.

On top of this, I do an annual spending review; we spend almost entirely with credit cards or direct billing, so our statements have over 98% of our spending identified with merchants. I pull these together and put them in an Excel sheet, then classify them into 10 top-level categories and 30+ subcategories that make sense for us and how we spend money. This takes a few hours once a year, but I value privacy and don't mind Excel so it's a better choice for us than handing our information over to a service that slurps it all up and digests it.
posted by Homeboy Trouble at 10:50 AM on January 24, 2020

We've decided to almost totally intermingle our finances. I was a little reluctant at first but it works great.

We each maintain our own bank account and credit card, but our paychecks go directly to the joint bank account and 95% of purchases get made on the joint credit card. We have no explicit rule for moving money to our personal accounts other than trusting each others' good judgment. At first we were going to give each other a specific allowance but we've both just taken to using the joint card for almost everything so it's redundant.

Once a month I pay the credit card bill (out of the joint account) and import the credit card purchases and and bank account transactions into a spreadsheet. I label each transaction (Groceries/Entertainment/Mortgage/etc, takes about 15 minutes) and it generates monthly summaries that I can compare to previous months.

In terms of privacy, we're both still able to make purchases from our own accounts without the other knowing. It just doesn't really come up that often.

In terms of "fairness"... it's not really an issue. We discuss big ticket items, and mostly ignore little stuff. Even when I'm going through transactions at the end of the month I don't really pay attention to whether my wife has been (for example) eating out more than usual or whatever. If something is an issue it'll show up in the monthly breakdowns, which is good -- the whole point of tracking your budget!

The upshot is we both get a crystal clear picture of our family finances. For us it has absolutely built trust. I was worried at first that we might nag each other over little things but the opposite's been true -- having both of us entirely on the same page makes it easy to ignore silly/unnecessary purchases by either of us. If we're hitting our savings targets, who cares if I buy lunch once in a while? If we're not, best to know right away so we can deal with it.
posted by no regrets, coyote at 1:38 PM on January 24, 2020 [1 favorite]

As an addendum, we both make similar salaries which does make things easier. But I'm glad we're establishing this system now so that if/when that stops being true we're already used to the money just being one big pot that we're both responsible for.
posted by no regrets, coyote at 1:41 PM on January 24, 2020

My wife and have one checking account. Everything is shared. There are no bills that are just mine, or just hers. I'm a fan of Warren's 50/20/30 framework so I download everything into a spreadsheet once per month and make sure we are on track with the framework. As long as we are in line with the budget we don't really worry about who spent what where.

We do have separate credit cards in our own names - mostly for making sure she maintains a credit rating, although 95% of our discretionary spending goes on a joint card for the airline miles. Around Christmas or birthdays she'll sometimes ask me not to download her account because I might ruin a surprise, but that is the only time we every worry about privacy when it comes to spending.
posted by COD at 2:16 PM on January 24, 2020

Our setup is similar to no regrets, coyote above, but without the individual accounts. (So beyond socialist, more like full communist.)

We have a shared checking account, savings account, and credit card. (We have separate retirement accounts because those are tied to employers, but that money is effectively joint.) So there's no mine or yours, just ours. It works well for us; the transparency means that larger purchases get talked about and smaller ones don't need to be discussed. (Our cutoff for discussing purchases is usually around $200 but that shifts depending on how expensive a month is being.)

I don't like the idea of having someone look over my shoulder on every expenditure or having to ask "where did all our money go?"

To me the transparency feels more like accountability and communication, rather than an invasion of privacy or a lack of autonomy. If it felt that way, we would definitely structure things differently. And, it is our money, so asking "where did it go?" seems ok as long as it is being asked in the spirit of partnership rather than control.

In the past at various times I have used both Quicken and Mint; the last couple of years I haven't been tracking expenses granularly but I'd like to start that again to see the patterns. Especially when things were tight, tracking that way helped a lot.

We don't have kids, so I can't speak to how that would change things. At various times our incomes have varied from identical to wildly imbalanced but we've used the same approach throughout.
posted by Dip Flash at 6:50 PM on January 24, 2020 [1 favorite]

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