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This might sound obvious, but let’s face it: personal finances become more complicated when you’re in a relationship. After all, when you start sharing expenses with your significant other, they’re not just “personal” finances anymore. That’s why I recommend proactively thinking about the best way for you and your partner to handle money in your relationship. It’s something that I’ve done myself, and it’s made a big difference in my own relationship with my boyfriend and how we communicate about money.

So to help you and your partner decide how you want to handle your finances, here are three models that you can use — and my thoughts on why you might (or might not!) want to go with each approach.

Model One – All in it Together

This model is popular with married couples (especially couples with kids) because the couple brings all of their assets and liabilities together. In this approach, you and your partner would handle your finances in the following way:

• All your money lives in joint bank accounts (both checkings and savings) that are held in both of your names.
• You make purchases using joint credit cards, or personal credit cards that you pay off from your joint accounts.

Why it works

If you’re in a committed relationship, there are a few reasons that you might want to consider merging your finances 100%. For one, it’s easier to budget, track your spending, and save for goals when you’re treating all your expenses and income as one. You and your significant other both get full transparency into where your money is going, and what you’re each spending on. It also can make you feel even closer and more committed to each other as a couple, since merging your finances requires trust and honesty. (If you’re looking for a how-to, here is a guide to merging your finances from Zeta — which is a tool specifically geared towards couples that helps them master their money together.)

Potential Issues

But the flip side is that having totally combined finances can create a messy situation if you and your partner ever separate or get divorced. That’s obviously a worst-case scenario for any couple, but it’s important to think about beforehand — especially if you’re not married since your finances wouldn’t be protected. This approach also requires you and your significant other to be 100% on the same page about how you want to manage your money, which is sometimes easier said than done. What if one of you is a big shopper, but the other isn’t? Or what if one of you wants to invest in a particular area, but the other thinks it’s too risky? This can be an ongoing source of tension in your relationship, so it’s important to try to get on the same page before you join your finances.

The bottom line: If you’re in a committed, long-term relationship and you’re comfortable being honest and sharing everything in your financial lives, I think this could be an excellent option for you.

Model Two – Yours, Mine and Others

This model is popular with couples who are living together or engaged (and sometimes with married couples, too!). If you take this approach, you and your partner would combine some of your finances in a joint bank account, but keep the rest in your individual accounts. There are two ways to set this up. In the first scenario, you both have your paychecks hit your joint account, and then you transfer some of the money into your individual accounts — so you’re basically giving yourselves a monthly allowance from that shared account. In the other scenario, your paychecks hit your own personal accounts, and then you transfer a set amount into your joint account.

Perks

What’s so nice about this setup is that you have a pool of money that you can use to easily handle your shared expenses, but you still have control over the purchases that you want to make individually. So if you really value your financial independence, you can keep your own bank accounts, but still, easily manage any expenses you and your partner share (especially if you track it all with an app like Zeta). And each of you can decide what you want to spend your own money on, without the other person being involved — so you don’t have to explain how much you paid for that new sweater, or why you went out to that fancy dinner with friends.

Pitfalls

The reason that some couples don’t like this approach is that they feel it can cause unnecessary tension between what is “mine” and what is “yours” — especially if they’re married or have kids. And some people argue that certain debts — like student debt or mortgages that pre-date the relationship — should be a shared burden since both people in the relationship are benefiting from those investments.

If you and your partner value your financial independence, but also want the convenience of joint accounts for all your shared expenses, I think the “Yours, Mine, and Ours” set up is a great option.

Model Three – Keep it Separate

In this model, couples maintain entirely distinct accounts. To make this work, I often see people create a list of shared bills and expenses (like their utilities or grocery bills), and then they either rotate who pays or choose to split everything down the middle. By doing it this way, they can divide their expenses without merging any of their finances.

I find that this is a great model if you’re early in your relationship, and it even works if you’re living together. That said, I think it’s harder to maintain this set-up over time, as your lives become more and more intertwined. I often see couples who start out by keeping everything separate but eventually open some joint accounts or fully merge their finances.

Tool to Make it Work

But for couples who are keeping their finances separate, I highly recommend finding a way to track who paid for what and make sure that you pay each other back. Some people use spreadsheets or try to immediately send a Venmo or Paypal to their partner to settle up. I would also recommend looking at a tool like Zeta, which allows you to track your spending and split expenses automatically.

So my take on keeping your accounts separate: it’s a great thing to do for couples who are earlier in their relationship, and just requires clear communication and tracking to make sure that you and your partner are evenly spending.

Clearly, there’s no “best” way to manage your finances when you’re in a relationship. So I recommend that you and your significant other sit down and talk about which method you’re both comfortable with. Because nothing says “I love you” like “let’s talk finances!”