Love and money
In a romantic relationship, balancing the budget is far from rhyming with romance. Still, this activity is no less important for a couple and while most partners believe they are on the same page on that matter, this is rarely true.
Although you should not discuss bank statements on your first date, as things are becoming more and more serious between the two of you, it comes a time when you must address financial matters. It is important to be absolutely clear with each other, particularly when you decide to move in together. There is no need for you to handle your credit card statements to each other, but you rather have a pretty good idea of what to expect. The more the relationship gets serious, the more precise, transparent and honest you must be.
Before even considering marriage, it would be wise to check if your partner is your ‘money soul mate’ and, if not, how you two can work this out to sync up. Here are some points to consider:
- a) in regard to saving – how do your partner and you behave? Are you those ones that have been saving since your first paycheck or the ones that say there’s never enough to save? Do you have saving goals for the long-term as retirement or buying a big property or you just focus on buying toys as cars and electronics? Or else, are you saving at all?
- b) still on the saving matters – let’s say that you or your partner inherit a generous sum of money from a deceased loved one. What do you do with it? Do you save all the money or spend everything? Maybe save part and spend the rest? How much?
- c) budget – what are your and your partner’s styles? Do you plan everything and know where every penny goes or your style is like budget? I’m not familiar with this concept! If you do have a budget, do you keep track of it or leave it loose?
- c) overdraft limit and credit card debit – how do you two handle this? You never use them, period! Or you are always dangerously close to the limit, playing catch up? You always pay the minimum balance or pay off the expenses ahead of time?
- d) handling the money – how do you and your partner behave? Would you have the approach ours, yours and mine allowing you to have a joint account for shared expenses as well as separate accounts to have some financial independence? Or you prefer the attitude mine is yours and yours is mine? Or maybe you are part of that category of people that are willing to share a toothbrush, but not a bank account?
- e) attitude towards life – are you and your partner the all-in type, meaning you live the life in full as it’s all about today? Or you are always ready for anything as we never know what life and the circumstances will bring? Or somewhere in the middle as one can have fun now keeping an eye in the future?
- f) financial planning – do you and your spouse have a plan at all? If so, do you set goals, keep track of the plan, adjust it from time to time? How often do you do it? Or you don’t like the hassle and stress of having goals and you don’t even need a financial plan?
When we take a couple, there is usually one person that is more interested in financial tasks or maybe has more time and skills to handle them. So as long as you two agree on who is best crafted to a particular responsibility, it’s fine for that spouse to be in charge of, let’s say, paying the bills, collecting information about mutual funds, or filing the taxes.
Play to your combined strengths. When it comes to money, a joint approach typically exceeds managing solo. Besides the fairness factor, there’s a practical reason: naturally, each partner has different but complementary financial skills that work better together than separately. Take advantage of those differences and make good use of them. And just to be clear, tasks may be done by this or that partner, but decisions must be shared.
Go through those points above.
Now that you know that you and your partner are truly in the same page moneywise, one helpful idea is to create an actual financial plan. With few exceptions, when people get married, they plan to be married forever. As forever seems to be a very long time, planning ahead of time couples will avoid a lot of problems and some potential costly mistakes. You may want to have a house, start a family, have children, sending them to college, travel around the world, etc. and all these objectives require a healthy financial picture (or should we say a wealthy financial picture?). It’s imperative to discuss how each partner will contribute to these goals, how each partner spends and saves and how you are going to work together to make your dreams come true.
Throughout our lives, our financial plan may change as the couple’s conditions vary, but continuous open communication is the key to financial success. Remember, you can always use the services of a financial advisor to help you reduce the stress with a consistent plan, paving the way for a happy marriage. And may forever be forever!
This article is for general, indicative purpose only and should not be considered investment advice. Florida Connexion is not liable for any financial loss, damage, expense or costs arising from your investment decisions based on this article.
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