How a guilt-free spending budget ended years of resentment, and the exact system we use now.
There were years’ worth of growing resentment between Seth and me. We were not getting along at all. Honestly, I didn’t even know it was about money until the moment it came out of my mouth.
All we knew was that I was nitpicking his every move, physical intimacy was low, and I was contemplating our entire existence together. We had a huge blowout argument about who knows what and after about an hour of discussing how things were unraveling between us, it just sort of came out that I did not feel like I had any agency in our finances and I felt really deprived.
The simple answer came from him: “What if we gave you a budget of like $5,000 a year that you could do whatever you wanted with?” And in that moment I was flooded with relief. Tears came to my eyes because that was just the little piece of freedom I had needed for years.
“Yes, I would LOVE that! That would be so, so helpful!”
Our FIRE Journey
Let me back up for a minute because this is important info. In November of 2023, we discovered Financial Independence / Retire Early or “FIRE” because some friends we met were in their mid-thirties enjoying complete financial independence and living their best life.
We were completely in from the second they described what they had done. Basically, live extremely lean, save and invest as much money as you can until you have enough invested that you could live off of 4% of your entire nest egg. The rule of thumb is that if you withdraw about 4% of your investments per year, research suggests the money should historically last 30 years or more. So if you can live on $60k a year, you’d aim for about $1.5 million invested.
Seth and I immediately got to work slashing all of our spending, setting up different investment accounts, and working on a new budget together that was way leaner than what we had been spending.
How Our Finances Are Combined
Seth is a software engineer with about 10 years of experience, and I have been running my own business for about 13 years. We are both established in our careers, but Seth makes about 4-5 times what I make every year. Our money has been completely combined since about 2011, so we do not have separate accounts for anything. Since then, we have always shared everything equally; there is no “mine” or “yours."
All of our money goes into different checking, savings, and investment accounts that we both have access to. There are pros and cons to this way of doing things, which we will get into in another post, but that is the way we do it.
After meeting those friends, we changed a lot of things in our financial lives. The goal was to save enough money that Seth could quit his stressful job earlier than the normal retirement age.
What We Cut
We stopped going to restaurants, cut our grocery bill in half, I stopped buying clothes for myself, we stopped hosting dinners at our house, I gave up some real luxuries like the occasional dog walker and house cleaner, and we ended all of our subscriptions (no more Netflix, Hulu, Audible, etc.), and we just stopped buying STUFF. I stopped going to the carwash, going out to movies, going to concerts… basically anything entertaining ended unless it was free. Seth also cut his personal spending substantially with cheaper haircuts, etc.
This and some other things culminated in us cutting our yearly spending in half and having a savings rate of like 60%. We started seeing our investments grow, and it was so encouraging that we just kept going, reading our free library books to pass the time….
Fast forward to 2025, approximately one year ago when we had that fight and we were basically hating each other. By that time, I felt like I had everything I needed in life, but I didn’t feel like I had any agency in our spending. He really wanted to retire from his job, and I really wanted him to be happier and not be staring at a computer 80 hours per week.
Guilt for Spending and Lack of Agency
In a word, though, I felt guilty any time I spent any money on anything for those 2 years. While I felt really proud of and excited about what we were doing, I felt guilty and stifled because we had had a bunch of arguments over things like $2.50-a-pound vegetables being too expensive. So because he was the one who wanted to quit his job and he was the one making the majority of the money, I agreed to it all because I wanted to support him.
Well, folks, this is not the way to manage your money jointly!
We realized that we had pulled in the reins way too hard, and we both felt a bit stifled and neither of us was happy. We chose to start spending a little bit more money on things that really helped our happiness and health. Instead of our motto of “spend as little as we can,” we adopted a more balanced approach to managing our money. And thankfully, we were introduced to the idea of guilt-free spending by Ramit Sethi, whose podcast episodes on money management for couples we have both thoroughly binged. That’s where the idea came from for me to spend $5,000 per year on whatever I wanted with no questions asked about what I spent the money on. It was a liberating idea, and freedom is one of my highest values, so I can not overstate how much this meant to me.
Seth gets a guilt-free budget every year, too, but we decided that because he was working insane hours and felt really burnt out, he should get more, so his budget is $7,500. His hobbies are more expensive than mine are (he’s into woodworking). So I was completely fine with him having a reward for his many years of toiling after talking it out together. The amounts don’t have to be equal, but they do need to feel fair to both partners, and you have to decide on them together. These numbers are also not set in stone for us.
So here’s how we do things.
Fixed Costs and Savings
We have an agreement about how much we spend on things every month. We use the Monarch app to track everything, which I highly, HIGHLY recommend.
We have intended budgets for our fixed costs like mortgage, groceries, utilities and home maintenance, health care, dog care, auto maintenance, insurance, and stuff like that.
We have set amounts that go into brokerage accounts, 401k’s, and other investments.
We make sure we have at least 6 months of fixed costs in our savings accounts at all times.
My business accounts are completely separate from all of this - I just pay myself from those accounts to our personal accounts every month.
Extras
Then we have an agreed upon monthly or yearly budget for each of us for things like therapy, body work, necessary clothing, climbing gym memberships, gifts, and travel. For instance, I know that I can spend $150 per month on body work, so I have to choose wisely how I use it, and if I don’t use it that month it rolls over to the next month. We allot some amount of money for miscellaneous things like household supplies, self-care, etc. All of this is set up in the budgets area of Monarch, so we can track how we’re doing. We like to separate this for our own reassurance that if Seth lost his job, we would know exactly what things to give up in order to cut our costs and make things work.
How We Talk about Going Over Budget
All of the above is agreed upon beforehand, and if we are going to spend over the budget for some reason, we talk about it and figure out if it makes sense. For instance, when I decided I wanted to go back to school to become a mental health therapist last year, it was very much a joint decision. We discussed exactly how much it would cost, how much less we would save over the two years I’m in school, and whether that was worth it to our overall goals of Seth retiring early. We decided together that it was, and he is completely supportive of it and I do not feel guilty spending the money.
However, if I wanted to, say, buy a horse and keep it at a stable or something expensive and ongoing like that, we would do the same calculations and same pros and cons conversation, and we would almost certainly come to the decision that we are not going to do that because it’s just not worth it to have that luxury. We would rather spend our money on traveling and hobbies, and of course, savings.
Guilt-Free Spending
And now, we have our guilt-free spending “accounts” that aren’t even real bank accounts (they’re just flexible budget items in Monarch), but they work extremely well for both of us. At $5,000 a year, I get to spend $416.67 per month on literally whatever I want. This is very exciting to me! I buy art supplies (I do colored pencil drawings of animals) and clothes, and artwork or whatever I want.
How Guilt-Free Spending Improved Our Relationship
That guilt-free spending shift that we made a year ago has been the best thing we could have done for our relationship. When we gave me that budget, I immediately felt closer to him, more supported by him, and less nitpicky about the things that were previously driving me insane about him. It felt like a miracle. I had more patience for him, I felt more love for him, and I was able to let down my guard and be more intimate with him, too. This has continued for the past year, and I know it has a lot to do with the changes we made financially.
Here’s the funny thing, though. It’s now October 17th, and I still have $2,976 of my $5,000 left in my budget for the year. I have spent less than half of it, and I don’t have any plans to spend much more of it by the end of the year. It wasn’t the amount I had in there - it was simply the agency and autonomy that I got. I feel more in control of my personal finances, instead of it all being joint and judged by each other.
Alternative Ways of Splitting Things Up
So that is how we split money without resentment. This is just one way of doing things, though! There are a lot of different ways to do it, including having shared accounts for investments and fixed costs but then separate accounts that each of you keeps private. You could also put all of your accounts in Monarch, but reserve control over some of those accounts for one person only. This gives transparency to each partner but reserves control over certain accounts. You could also keep everything separate and just have agreed-upon amounts that each person pays for all of your fixed costs and extras. But that gets tricky, especially in a world of 50/50 splits being the norm. I’ll talk about that another time.
The main thing driving this is that you have a shared vision for your financial goals together. You have to be on the same page about what you want for your life now and when you retire. We play around with spreadsheets and online calculators all the time to make sure we’re on track and estimate how much we’ll have at certain points in time. I’ll share those tools with you in upcoming posts.
This Is Not Everyone’s Reality
One thing I want to put out there is this: I know that our situation is not like everyone else’s. Seth makes more money than a lot of people do, so our spending and savings capabilities might look different than yours one way or another. I do not take this for granted, and it was not always this way for us. For a long time, we made like $40k a year between the two of us and we made it work, so I get that some things I’m talking about like dog walkers, house cleaners, bodywork, and travel are not really part of some people’s reality. I’m not apologizing for our household income - I’m just calling it out for people who might feel othered by some of the things I talked about here. I will give examples of solutions for people at many incomes going forward - this is just our story.
The principles remain the same, though!
If you and your partner are stuck in the same money fight, you’re not alone, and it’s fixable. Every week I share one practical tool for money and relationships, plus honest stories from Seth’s and my 21 years together. Subscribe for free so you don’t miss the next one.
And I’d love to hear from you: How do you and your partner split money? What’s working, and what’s not? Tell me in the comments.
If you're in Texas and you two keep getting stuck on how to split money fairly, I offer $30 online couples therapy and individual therapy.
Talk soon,
Neely
