Money is a tricky enough concept to figure out when you’re single and alone. Trying to make rent, eat food and somewhat survive is tough but throw another person into the mix and suddenly things start to become problematic. And while a long talk about the history of your credit score and financial stability isn’t exactly first date material, ‘money matters’ have the uncanny ability to stop even the best relationships dead in their tracks.
Despite what we may believe about love conquering all, money and the expectations and responsibilities that come with it play a vital role in having a healthy relationship. Research shows that 7/10 couples report that money causes tension in their relationship. We all know that there are a few hot button topics to avoid on a first date, exes, future children and money. However, it is money that ranks highest on the ‘do not talk about list’ are – in fact, most couples tend to ignore the topic of finances altogether.
In all good relationships, matters of the wallet are equally as important as matters of the heart. Having a spouse or partner who is fully aware and supportive of your financial situation and strives to work together can help ensure together you reach financial stability. You need to be able to have open, honest conversations about finances, to have the ever-daunting money talk with your partner in a way that is effective, productive and beneficial to your relationship. Here are four tips to help guide you and your partner through the seemingly impossible ‘money talk’.
Ensure the Issues are Really About Money
Communicating with your partner about money matters can be a real sticking point in relationships – whether you’re just starting out or have been married for many years. To help alleviate any tension try and make the conversation less about graphs and spreadsheets and rather about goals and values. Discuss your financial priorities for your future together, how you wish to live your life, how you wish to retire, where you want to live and what you hope to achieve together. You also need to ask each other; do you want children? Do you want to travel? Or do you want both? These are conversations that you need to have with your partner, you need to have a realistic idea of what you each expect from your life and your finances – and use these answers to help inform your overall financial plan.
In life, it’s always better to be prepared than scared. Life is filled with many unexpected twists and turns that often can leave us and our lives shook. Things like illness, job loss, and home repairs aren’t exactly fun things to think about but can all happen in just the blink of an eye. Therefore, it is essential to be prepared financially for the worst-case scenario.
*side notes: A good safety net usually consists of three to six months of income in an account. In addition to your savings, you should also ensure that you both have enough life and disability insurance to help protect your income and help you avoid borrowing against your future to help you out of a hole today.
Having a shared approach to financial matters and retirement plans ensures you both feel more secure and satisfied with your financial future. Start by figuring out a logical way to divide your financial responsibilities amongst yourselves. Perhaps one of you handles the bills while one of you handles savings and investments. Whatever way you feel works best for you and your relationship it is important to ensure that you are both happy and understand the expectations and responsibility that are yours. Make sure you are both making progress towards your long-term goals when you are both making sacrifices and compromises for your future you are less likely to have one partner feel resentful or burden by the financial pressure.
No matter what your relationship status, whether it’s serious, ‘it’s complicated’ or just for fun, getting a grasp on where your partner stands on the things that matter – money included. There is no need to come right out and ask a bunch of deeply personal finance questions but when you’ve found the person you want to spend the rest of your life with, you will be grateful for having had these discussions beforehand.