Make a date for a serious relationship talk … about money.
Financial problems are one of the leading causes of divorce, so it’s important to make sure you and your partner are on the same page financially if you are going to commit for the long-term. By speaking openly about finances – no matter how difficult this may be – couples can manage their differences and find their way to compatibility.
When the relationship gets serious, and you’re talking about moving in together, or marriage, or having kids, you should sit down with your partner and have a discussion about the following financial areas:
Disclose your credit statements to one another. How much debt do each of you have? This must include credit card debt, vehicle loans, student loans, bank loans and retail store cards. Don’t hide anything as this would really get you off on the wrong foot. It’s a big red flag if your mate is defensive and doesn’t want to talk about debt.
Discuss both your attitudes towards saving. How much of your income do you want to allocate towards saving? What are your savings goals? What would justify spending your savings? What is a greater priority than saving? Work on a saving plan together, remembering to be both honest and realistic to prevent failure.
Discuss what you each spend money on and how you make those purchase decisions. When you’re in a partnership, that is likely to change. For instance, what sort of purchases or financial decisions need to be discussed up front, and what decisions are made individually?
Put a budget together and talk about who will be responsible for what expenses. Work out whether you want a shared household bank account or two completely separate accounts. Will you split financial obligations down the middle, or will each partner contribute according to their earning ability?
Do you and your partner share the same views on retirement planning? If not, discuss the differences and work out a plan based on your joint goals. Work out how much is needed, and work out how you are each going to manage your contributions to your retirement plan.
If you are at a similar point in your life… that’s great.
Make a financial checklist of your goals and achievements to date. Your spouse must do the same. If you are at a similar point in your life with similar goals and aspirations, that’s great. If, however, one partner is way behind the other in terms of achieving financial goals, then discuss how this imbalance would work in the relationship.
Did you find that your plans, goals and achievements matched, or were you singing from completely different hymnbooks? Obviously, it’s great if you are financially compatible, but differences of opinion don’t have to spell disaster. The most important things are that you are both being honest and you are both willing to work on it together. To find some middle ground so you can start working towards your “happily ever after”, ask each other the following questions:
- For what beliefs are you willing to stand your ground?
- What are you willing to give up for the greater good of our relationship?
- What are your top 10 financial goals for the next three, five, 10, 20 and 40 years? Look at the ones that appear on both your lists and see how you can get there together.
The most important aspect of determining the financial compatibility in a marriage or long-term relationship is discovering early on how you and your partner’s monetary viewpoints match up. If money differences are brought to the surface in time, a little compromise and strategic planning can put your relationship back on the right track. Call in a professional marriage counsellor or financial planner if necessary!
PS: Heard about Married At First Sight South Africa? As the show’s financial expert I will be talking more about marriage and money, so don’t miss it. Starts 3 February on DSTV Channel 131.
The views and opinions expressed in this article are those of the authors and do not necessarily represent or reflect the views of 1Life or its employees.