6 Steps to Take if You Keep Finances Separate in Marriage

Quick Answer

Couples can keep their finances separate, but to ensure smooth sailing, it’s important to communicate and outline who owns and is responsible for what. It’s also wise to get legal documentation of agreements, especially if you live in a community property state.

Young man and woman married couple dividing expenses.

Talking about money might feel like one of the least romantic things you can do, but it's a crucial way to build a strong foundation for your relationship. Communicating openly about your finances and proactively planning together reduces chances for surprise and conflict later.

Some engaged or married couples prefer to keep their finances separate; this might be to protect an inheritance or business, or to ensure one partner isn't responsible for the other's debts. Others choose this route because they've been burned by a past partner, or they just feel more secure knowing their savings are protected should the relationship sour.

If you choose to keep your finances separate in marriage for any reason, you'll need to forge a plan together that covers what property belongs to whom, how you'll pay bills and save for goals and whether you should obtain legal documentation that gets your plans in writing. Here's how to get started.

1. Make a Financial Plan Before You Marry

Survey after survey reveals that financial issues are one of the top reasons for relationship problems and divorces. You can reduce future fights and surprises by having a heart-to-heart about money before tying the knot. It can feel uncomfortable to be open about something we're told is taboo, but it helps to start this journey with eyes wide open and share where you each stand with your credit scores, debts, savings and goals.

Decide what will stay separate and what will be combined, if anything. Familiarize yourself with the laws in your state so you can plan accordingly. For example, in some states, individual property remains separate unless it's commingled and moved into a new or joint account once you're married.

Discuss the nitty gritty of how things work. Will you open a joint checking account or keep everything separate? Will you budget together or individually (or both)? Can you count on the other for retirement savings, or are you on your own? Will you file taxes jointly or separately? Getting on the same page now will save you headache (and potentially heartache) later.

2. Consider a Prenuptial Agreement

If you haven't yet married and you're both feeling protective of your current assets, you might feel more comfortable starting with a prenuptial agreement. It's challenging to start your marriage by thinking of divorce, but mapping out answers to the what-ifs can offer peace of mind.

A prenuptial agreement outlines which current and future assets and debts belong to each person if the marriage ends. Rather than defaulting to your state's rules, it allows you to indicate what's joint and what's separate property.

Having a prenup isn't required, and they're most often used by wealthy individuals with significant assets to protect. But anyone can create one, and they aren't just for ensuring a divorce doesn't strip you of half your savings. Prenups can be useful for those who want to keep some property separate for children from prior relationships should this one end in death or divorce. They can also be used by someone who wants to protect their partner from debt, or to simply outline financial responsibilities or obligations. You can hire a lawyer to create one, or you can use an online service to draw one up.

3. Decide How You'll Handle Bills

Some of life's bills can be handled on an individual basis, but if you and your spouse live together—and especially if you have children or pets—you'll have some shared obligations.

There are different ways to handle this, so discuss what options work best for you. It can help to go through your bank statements and write out all bills, then go down the list. Will one of you pay some bills, and the other partner pay the rest? Or will you maintain separate bank accounts but open a joint one that you each pay a certain amount into each month, and recurring bills are paid out of that joint account?

Will you take turns paying for groceries, or will you Venmo each other half the bill whenever the other shops? Make sure to also think about how you'll pay for utilities and transportation, especially if you share cars. Consider that some bills, such as those for cellphones and gyms, offer discounts for family plans. Discuss if it's worth being on a joint plan for the savings, and how you'll handle payment.

4. Prepare for Inheritance

Even in community property states, inherited assets are typically considered separate property. That means even if you're living in a community property state like Texas, and your parent dies and leaves you their retirement account, that is your separate property—your spouse is not entitled to it. That is, until you commingle the money in shared accounts, or use it to buy property together. Once you put that separate money into a shared account, it becomes marital property.

If you intend to keep any inheritances separate, particularly if you live in a community property state, you can protect yourself by keeping that money in individual accounts in your name only. This way, if you ever divorce, you have certainty those assets remain yours and don't have to be divided. Consider meeting with a legal and/or financial professional to ensure you don't inadvertently do anything that turns it into joint property.

5. Consider Creating Property Agreements

If you live in a community property state, certain assets are presumed joint. But what if you're the one who bought your house and you want to keep it in your name only? Or your spouse is taking on student loans and you don't want to be responsible for them? Or, like the example in the earlier section, you're worried your inheritance will accidentally get commingled?

If both partners consent to keeping assets or debt separate that would otherwise be considered joint, there's a workaround. You can draw up a property agreement together with a legal professional anytime; these are sometimes referred to as postnuptial agreements since they're done after the marriage. They do the same thing as a prenup, but they are drawn up and agreed to once the marriage has already begun.

6. Plan How You'll Save for Future Goals

Some aspects of finances are easy to keep separate, like getting your paycheck in your own personal checking account. But how do you plan for long-term financial goals together? Think about future joint expenses and discuss how you will handle them. Make sure to discuss contribution, like how much each person will pitch in and when, along with distribution.

For example, perhaps one spouse has much higher income than the other. Will the lower-income partner be able to contribute less, and what does this mean when it's time to retire?

Make sure to think about you'll save for goals such as:

Our personal relationships with money can be complicated and emotional, so it's no surprise that navigating finances with someone else can be especially challenging. With self-awareness, teamwork and careful planning, you and your spouse can work together toward common goals while still maintaining separate finances.

Protect Your Credit in Marriage

Regardless of whether or not you and your spouse decide to keep your finances separate, your credit score is yours and yours alone—no matter how long you're married. You can check your credit score any time free from Experian, or sign up for credit monitoring so you can be alerted to any changes that need your attention.