Keeping Finances Separate

When F and I get married we plan on keeping the majority of our finances separate. While I believe in joint accounts for joint expenditures I also think it is healthy to have your own money. I'm especially comfortable with this because we are both budgeters and careful with our money (to be honest he is better at staying within budget than I am).

So when I say the title of Laura Rowely's column, Keeping Finances Separate Can be Costly, I immediately read it. The article states:

Young professional couples are more likely to keep their financial lives separate -- and are also more likely to fight, practice financial infidelity and have financial regrets, according to a recent survey by American Express.

This was surprising to me, my assumption being that if finances are separate you would fight less about money. The article goes on to talk about the survey:

Ginita Wall, CPA and financial planner in San Diego specializing in divorce, says she's not surprised by the findings. "You would think if their finances were separate, couples wouldn't fight about money, but what happens is they never have an opportunity to talk about mutual goals," says Wall, co-founder of the nonprofit Women's Institute for Financial Education (WIFE.org). "So one of them will set a goal to save for a bigger house while the other may think new golf clubs are more important -- and they are off to the races fighting about money." Nearly one in five of young professionals regretted not discussing financial goals and expectations earlier.

Makes sense, and is actually a relief since F and I talk about our budgets and our money regularly. While we still have to sit down and figure out some long term financial goals for ourselves (i.e. should our next big savings goal be for a down payment or something else), I'm in no way worried about having this conversation. Like I mentioned before, if you are saving for a joint goal, like a down payment, that should be a combined account. However, when I'm saving for a new toy like an iphone that is not a joint account item. F should not have to pay for that. In fact the article goes on to say:

Klontz says he often sees a hybrid approach, where couples "strike a balance between financial autonomy and financial interdependence," he notes, in which they contribute to a joint checking or savings account for major household expenses and goals, while maintaining separate accounts as well. "Merging finances together works great as long as there is honesty, joint sharing of power and control and financial integrity, for example, paying bills on time. Without these safeguards in place, one or both partners can be at significant financial risk."

However you decide to hand your finances when you married or become life partners, communication is key because like your priorities, your money is not longer just about yourself.

Final Travel Budget

My goal was to spend under $2000 while I was In India and Sri Lanka. I ended up spending more.

Here is the breakdown:

India Visa: $73

Roundtrip Flight: $967.41

All the other Flights: $544

Cash spent in India: $943.49

Credit spent in India (mostly gifts and souvenirs): $582.49

Cash spent in Sri Lanka: $583.35

Credit spent in Sri Lanka: $32.36

Getting to and from the airport in the US: $41.30

Total: $3767.30

My goal was to spent $3584.41

$182.89 over budget. At first I was really bummed that I went so much over budget. However, in the long run, it is not that much and I can afford it.

So what did I spend my money on? Besides hotels, transportation, food, and gifts I bought two very nice things for myself. I got a real pashmina for only $100. It is the softest thing I have ever felt and I'm so excited for it to be cold so I can use it! I also bought myself a really nice sari.

photo by शंतनू

Pictures of India (part 3)

Up in the Mountains in Ladakh

At the world's third highest motorable pass

Pangong Lake

The Taj Mahal

Fatehpur Sikri

A special thanks to my friends who let me post his pictures after I lost mine!

Pictures of India (part 2)

Scenery in Ladakh

Shanti Stupa

Where the Zanskar and Indus Rivers Meet

Pictures of India (part 1)

Haji Ali Mosque in Bombay

The Monsoons in Bombay

Sari Shopping in Bombay

The Himalayas from the Airplane

Hemis Monastery in Ladakh

Internet Down

I have good news and bad news. The good news is that I'm feeling better and ready to post again! The bad news is my internet is out at home. So I'll do by best to post during lunch or after work, but I'm also starting a class tomorrow so life is about to get hectic again.

I would still like to post some pictures from India, my final travel budget, and a wedding planning update (my dress came in!)

So I apologize ahead of time if my posts are not as regular as I would like them to be. I have an appointment for the end of next week and hopefully my home internet will be up and running again!

Some Final Pictures of Sri Lanka

A monkey digging into some jackfruit

Elephant butt at the elephant orphanage

Elephant orphanage

Taking a bath

At the beach

More Pictures of Sri Lanka

Just as a heads up - I took a lot of pictures of monkeys and elephants.

Sigiriya

View from the top of Sigiriya

Mommy and Baby Monkey

Wild Elephants

I'm back (and a little sick)

I got back from my amazing and exhausting trip to India & Sri Lanka on Monday morning. Unfortunately I have not been feeling well since. So instead of a real post I'm just going to post some pictures from Sri Lanka (more to follow of Sri Lanka and India to follow soon).

Tea Country

Tea Pickers at Work

Tea Tasting

Temple of the Tooth, Kandy

Why Do You Overspend?

I find that I go through stages. There may be two months where for some reason I spend a good deal of money on clothes. The month after that it may be on eating out. Or, the weather gets nice and I find myself spending a lot on happy hours and dinners - any excuse to be outside.

Being financially responsible is not easy. There are always temptations. And if you are anything like me those temptations are always changing. It would be a lot easier to maintain my budget if I knew I always overspent on clothing and that was it. I could just avoid stores. However, like everything else in life, it is a moving target.

Yahoo finance recently identified 8 reasons we overspend.

1. Paying With Plastic

2. Listening to Music

3. Buying in Bulk

4. Dieting

5. Tracking Exact Costs

6. Buying Clearance Merchandise

7. Shopping Without a List

8. Falling for Clever Pricing Tactics

Some of them, like paying for plastic, buying in bulk, and shopping without a list I've heard many times. But other reasons I found more interesting.

I definitely have to be careful about buying clearance merchandise. I love getting a good deal, so if I'm not careful I could end up buying stuff I don't need or will use if it is on sale. I also have to ask myself - do I really want this and/or will I actually use this.

I had no idea that music could encourage you to splurge. According to the article:

Listening to music is perfect for increasing motivation during a workout. It also increases the motivation to spend. You're more apt to give in to impulse purchases in shops where instrumental or classical music is playing, according to one study.

Experts believe that loud music also impacts spending.

"Louder music in restaurants pushes people to eat faster, order more and consume more food because they can't talk to each other over the noise," explains Paula C. Peter, assistant professor of marketing and consumer behavior at San Diego State University. "Being overwhelmed by music also interferes with our ability to think clearly, which can lead to spending more money."

Finally, I was found tracking extra expenses really interesting:

Keeping track of purchases right down to the last dollar will keep spending in check, right? Wrong. New research found that consumers who try the hardest to budget are the ones who end up overspending. In fact, shoppers who attempt to calculate the exact total price of their purchases spend an average of 19 percent more than consumers who estimate an approximate total price. According to the study, "shoppers consistently underestimate the total price of shopping baskets, which puts them at risk for spending more than they budgeted."

If calculating the exact total is important, consider shopping with a calculator

I think this one is a little misleading. "Tracking extra expenses" sounds like normal budgeting. However, what I think what they are actually talking about is estimating how much you are going to spend when you shop. I always estimate, and even try to purposely overestimate, when I'm shopping. My goal is to spend under whatever I budgeted for that trip.

What do you do to keep yourself from overspending?

Photo by David Blackwell (back to black)