Why Giving Yourself an Allowance (When You Share Finances) Boosts Your Freedom and Frugality
When my wife and I first got married, we combined all our finances into join accounts and decided to make all of our spending decisions together, believing it was the best way to manage our money. I was convinced this was the best way to be united, but I’ve since learned the value of an allowance.
No Allowance = Dissatisfaction + Overspending
Dissatisfaction
After deciding to make all of our spending decisions together, we quickly found I was great at justifying my purchases and finding the money in our budget to cover it. My wife, on the other hand, had a hard time justifying spending money on herself when it was considered family money. Neither of us were trying to coerce each other one way or another but we saw personal spending from different angles and it created dissatisfaction for both of us.
Overspending
When you have no money to call your own it is too easy, or conversely too difficult, to spend money on yourself. Those who find it easy to spend money themselves create waste from overspending. Those who find it difficult to spend money on themselves find dissatisfaction from restriction.Allowance = Freedom + Frugality
Freedom
An allowance creates freedom. You and your partner decide how much to allocate for personal spending. The rule is simple: personal spending comes from your personal budget, and joint spending comes from your shared budget.
With separate personal spending, you no longer worry about how your spouse spends their money. You have the freedom to spend as you choose—whether it’s saving for a big purchase or enjoying smaller items along the way.
An allowance has given us a greater sense of responsibility in that it required us to think about our long-term personal wants and needs. It requires asking questions like, when will I need a new laptop, and can I make do on a cheaper cell phone plan so I have more money to spend on other things that are more rewarding? It has been a lot of fun. We enjoy our purchases more and have fun seeing the purchases of each other.
An personal allowance causes you to weigh more heavily what you want to spend your money on because your allowance is limited and you make better, more satisfying decisions.
Giving ourselves a personal allowance has been one of the best financial decisions we’ve made.
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