Sometimes people look at me funny when I talk about my allowance. Probably because I am not 12 years old earning money by doing chores around the house. Actually my husband and I give ourselves a cash allowance each month and it’s amazing. I can’t even put into numbers how many potential money arguments it has saved over the years.
When we were newly married and combined our finances, we agreed that no matter what salary each of us brought home, we were earning money for our household. We decided right from the start to split everything 50/50. We had a savings account and a checking account that we shared. In theory, this was a simple and fantastic idea.
In reality, well, we learned we have very different spending habits. I like fancy things and getting pampered…often. My office in New York was in the heart of Midtown and I passed favorites like upscale nail boutiques, Bloomingdales and J.Crew on my daily commute. My husband on the other hand, didn’t spend much on clothing and accessories, but he loved to dine out. He would say, “I can’t believe you spent THAT on another pair of jeans!” And I would say, “$16 for a salad seems excessive.” It made us think back to our pre-marriage classes and finances being the #1 reason couples fight. I never wanted to feel like I had to hide things (oh this old thing? It’s not new, it’s been in my closet for ages!) and I never wanted resentment between us on how we spent our money. We decided we needed a system that worked with our budget and gave us flexibility to spend (within reason) however we wanted.
The allowance system was born. We kept our joint account but opened two new checking accounts, one for each of us. Each month we give ourselves our budgeted allowance and can spend however we see fit, with no explanation needed. If I want to buy clothes or go to dinner with friends, and he wants to eat lunch out every day or meet friends for drinks, that’s fine…as long as we have the allowance for it. If there is a big or special purchase over our allowance budget, we just talk about it ahead of time.
Now that I don’t bring home a paycheck (unfortunate downside in the stay at home mom profession), the allowance system is especially important. I never feel like I have to ask for money and I still feel equal in the partnership, despite not contributing financially. I know my husband works hard to provide for our family and he knows I work hard to raise our girls and keep our lives from completely falling apart.
The allowance system has worked so well over the last 8 years that we even implemented it for the kids spending. Anything that falls out of the “necessary” category (oh, like impromptu matching dresses at Target) comes out of their “allowance.”
I have a few close friends who also use this system and we all agree – it’s easy and it works! Do you have a system for personal purchases that works for your family? Feel free to share any tips or ask questions in the comments below.
