Do Grown-ups Need an Allowance?
Remember the magic of childhood allowance? You could buy toys or candy, or watch it amass if your piggie bank with Scrooge-like glee. And no bills to pay with it!
What if grown-ups could have the same guilt-free, responsibility-free spending experience? If you’re married with joint finances, that might be just what you need to relieve marital money tension.
Call it what you like: blow money, fun money, spending money, allowance, discretionary funds, or the old-fashioned pin money. It’s the idea that you have some that’s designated as yours, that you can do with as you like. You can spend on Starbucks or shoes or Taco Bell or tools, or whatever else you want, without having to ask or answer for it.
If you’re single, it always makes sense to budget for the types of things this “fun money” might cover in marriage: treating yourself, going out, and other “fun” purchases. But you probably have way more autonomy is choosing how much and how to spend then someone who has joined finances for life. (Skip to tips below about determining the amount.)
While Dave Ramsey and other PF gurus make blanket prescriptions about spouse allowances, I think it depends on you, your spouse, and your marriage. If you’re married, you might need an allowance if:
- You have different financial personalities. We all have a natural bent toward saver or spender. This may be influenced by your upbringing or life experiences as well as temperament. Were you the kid who spent every dime that came your way, or did you (like me) hoard it in your piggie bank, and are still rolling the coins? (True story).
Opposites tend to attract, so it’s pretty likely you married someone with a different financial personality from you. And you’ll see it, among other ways, when one of you makes a purchase the other doesn’t understand or agree with. “Why do you need another _____?” You fill in the blank. Or maybe someone’s coffee habit or smoking habit or gym membership or hobby adds up more than the other feels is reasonable. Even with like financial personalities, our individual tastes are often incomprehensible to our spouse and therefore feel like unjustified spending.
I don’t know how the stars aligned for me to marry a fellow saver, but a huge part of the reason we actually don’t practice the spouse allowance is that we’re just both pretty tight with money. We generally trust each other to make good choices and respect the other’s decisions even if we wouldn’t have made them ourselves.
If you’re both spenders, you might not feel the need to institute an allowance, but it could be a wise idea for your finances. If neither of you minds the other’s spending, great! But if you’re both frittering away money needlessly without accountability, you might want to reign it in by setting a limit ahead of time.
- You fight about spending regularly. I don’t suppose there are many couples out there who have never argued about money. In fact, the first argument of our dating relationship centered on who should pay for gas (we were both trying to pay). But for many, it’s more than the occasional tiff; it’s an ongoing tension that can affect the overall health of the marriage. If this is the case for you, please try giving each other an allowance! It won’t solve everything, but if you feel like your purchase of new sheets turned into World War III, budgeting for spending money could really help.
- You think marriage should be fair. Though we might not realize it, a lot of us come to marriage under the illusion that everything should be equal, 50/50, fair. Here’s a sample conversation:
“The bank statement says you spent $50 on Starbucks last month. I think you should try to cut back.”
“Oh yeah? Well, you must’ve spent at least that much going out with your friends. Do you have to cut back, too?”
If you keep accounts like this and use it to justify your spending, whether to yourself or your spouse, it might be time to try an allowance.
Trying an allowance will not solve disagreements between how much to spend on major purchases, or setting your overall financial goals. It won’t turn a spender into a thrifty person, though they could learn some things about their spending habits and triggers from it. And it certainly won’t solve the underlying causes of marital tension. But it can be very effective in giving each spouse the freedom to do some autonomous spending while working together toward bigger goals.
How much is enough?
That is a question only you and your spouse can answer. First, decide what types of purchases should be covered by allowance versus the regular budget. For example, you should have a certain amount budgeted for clothes that covers everyone’s needs. But if you want something above and beyond that, you can use your allowance, perhaps saving up several weeks’ worth.
Next, consider looking at your last couple months of spending via bank statements or your tracking software. How much of those purchases fall under the categories you decided should be covered by allowance? (Or how much went above and beyond what was budgeted for those categories?) Are you comfortable with spending that much, or would you like to cut back a little?
Look at your first month or two of allowance as a trial. You can always tweak the amount—and what allowance needs to cover—as you go. Regroup after the first month or two and have a conversation about how it’s going, whether it’s helping, and if you both feel satisfied with the amount you first set.
What if your spouse won’t agree to it? If it’s a matter of the other person not wanting to restrict spending, you can always institute an allowance for yourself that you promise not to go over. One person budgeting and saving is better than no one doing it. If your spouse doesn’t want anyone to have an allowance, see if you can have an honest conversation about why. Is there fear or other feelings surrounding money? Have you overspent or broken trust in this area? This can be tough—feel it out, and remember, the health of your relationship is more important than you getting what you want.
Just remember, a grown-up allowance is something you should both agree to and should serve your marriage and overarching financial goals.
Do you have an allowance? How has it helped your marriage and/or finances?