The House Account

He didn’t keep a check register.  He phoned the bank to get his balance.  He wanted to live the high life, everything first class.  He wanted a new car every year, more or less.

She kept Quicken up-to-date, even the cash receipts, and of course, the check register, too.  She made sure there was enough money.   She wanted to retire early.  She wanted to give money to charities. 

They wanted to get married.

Financially incompatible? Destined to divorce, or at least endless fights about money?  Nope.  Allow me to tell you about The House Account.

First a spreadsheet enumerating all of the regular bills  (monthly, quarterly, annual) — the payee, the amount,  the frequency per year,  followed by 3 columns — Both, His, and Hers.  Multiply the amount by the frequency. His bills in His column, hers in Hers, and shared bills in the Both column.  Sum each of the 3 columns at the bottom:  His Sum, Her Sum, and Both Sum.

Next a second spreadsheet for the paychecks.  For each person, net pay, after taxes, but before any automatic discretionary payments, like deposits to savings accounts or stock payment plans.   Multiply by the number of paychecks per year to get the annual amount.  His Net, and Her Net.

Calculate a Ratio of the two (or use 50-50), and apply that Ratio to Both Sum to get the Allocated Portion of the shared bills.

Add up His Sum and His Allocated Portion.  Divide that big number by the number of his paychecks to get His Contribution. Have Him set up an automatic deposit for His Contribution to The House Account.   The rest goes into his checking account and wherever else he wants it to go.  Do the same for Her.

The designated bill payer then pays all of those regular bills — his, hers, and the shared ones — from The House Account.

With a little help from a financial software package forecasting feature, the bill payer can make sure that The House Account always has enough money, even for big annual bills like insurance and property taxes and the like.

11 years later: 

He saves for retirement now, and gives to some charities.    He’ll even fly in coach.  But he still buys a new car on a regular basis, and calls the bank for his balance.

She doesn’t bother with the cash receipts anymore.  She buys a new car every so often, herself.  But she still gives money to charities, saves for retirement, and watches the cash flow like a hawk.

They’re still married.   And they plan to retire early.   Together.  Thanks to The House Account.

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