A relationship can be hard enough, let alone going to the next step and living together and tacking the finances together as a team. Whether you decide to have one person pay bills, combine finances, keep separate, or a little bit of both, these are real conversations that need to be made as early on as you can, especially before things progress into marriage, where the conversation can be a little more difficult if there are any surprises that come up, so you might as well bite the bullet and have the discussion now.
Disclose Any Secrets
While it may be embarrassing if you have any debt or credit issues that are following you, but now is the time to disclose that. Sure, relationships can end because of money, but you want to air any dirty laundry now when it comes to what your credit card debt is, any student loan balance remaining, and what your credit score is. After all, if you are purchasing a home in the future, those financial details will come out now, so you don’t want to affect any increase in the set monthly payment.
Figure Out Bank Account Plans
There are those that can argue that separate bank accounts make the most sense, others that are in favor of putting all finances together, even some that agree that there is nothing wrong with keeping some money separate for spending and enough in a joint account for shared monthly expenses. While only you and your financial partner can decide what is best for you, even as small as an aaa membership cost, that is something to hash out to determine the right method. Also, keep in mind that things change and you may decide that it makes sense to combine everything for ease, and that is ok too.
Discuss Financial Goals
Much like we all have different hobbies, we also may have differing opinions on financial goals, so it’s a good idea to discuss what plans are for spending and saving. Whether it is creating an emergency fund to have a cushion if any unexpected charges come up, not to mention saving for the future, even as small as monthly cable expenses and vacations, are all items to plan for and decide together what is most important and what makes the most financial sense for the two of you. Whether kids are in the picture now or will be in the future, that may be when financial priorities change as well.
Handling the household finances is a tough job so it’s not one that has to be put on one person’s shoulder, so it’s a good idea to ensure that both of you are in the loop for all money coming in and going out. When it comes to purchases, it’s a good idea to take a look at last month’s credit or debit card statement and go line by line, not so much to call out the other person, but to decide together if they are necessary purchases or could have been avoided to free up extra money.