His or Hers? Why Household Finances Are Both Partners’ Business
If you’re like many Americans, you’re probably not personally involved in all of your household’s money management. Statistics from Pew Research show that one partner is typically more involved in managing the household’s finances than the other.
While splitting responsibilities can make sense, both partners should be involved in important financial decisions, says The New York Times. In the event of an emergency, you may be required to assume full responsibility for household finances, which means it’s important for you and your partner to stay on top of the family’s money management.
Go Beyond the Budget
Understanding your household’s financial picture begins with a shared money management plan, suggest financial experts at ValueYourMoney.org and the American Institute of CPAs. They agree that couples should arrive at a monthly budget and also discuss family financial goals, such as buying a house or saving for retirement. This can help your household create a plan for saving and investing toward those goals and enable both partners to understand monthly money outlays, such as mortgage payments or other bills.
Since the unexpected can strike at any time, LegalZoom says it’s also important that both partners understand the status of other household money essentials.
Try scheduling conversations between the two of you or with a financial professional to help you keep track of your money essentials, says ValueYourMoney. Plan on setting aside time at least once a year to review the following:
Household Finances Checklist
At a minimum, LegalZoom suggests both partners understand the following about each account:
- Location and contents (or balance) of all essential documents and accounts
- Account access credentials
- Payment due dates and terms (such as autopay or monthly payment arrangements)
- Interest rates and anything else needed to manage the accounts
Savings and Brokerage Accounts
- Traditional savings or money market accounts
- CDs or other savings vehicles, such as bonds
- Brokerage or investment accounts, such as those holding stocks, bonds, ETFs, options, or mutual funds, should also be shared, says ValueYourMoney.
Include all policies in your household, says LegalZoom. These may include:
- Life insurance
Housing Payments and Utilities
- Homeowners association dues
- Gas bills
Wills or Powers of Attorney
- Credit cards
- Student loans
- Car notes
- Installment debt
- Taxes, including past and present years’ returns and necessary receipts
Keep your information safe
How and where you store this information is critical in the event of an unexpected life change. USA.gov recommends creating an emergency financial records kit to help your family organize all of this important information. (Try FEMA’s free printable kit or an online service such as Information SAFE.) USA.gov recommends that you store paper versions of records off-site, such as in a safe deposit box, and that you consider backing up software or online versions on a hard drive.
Household finances can be challenging. By sharing information and discussing plans with your partner, you can help keep your family in control of its financial future.