It isn't romantic, but it is essential to talk about money before you get married. Here's how.
We are frequently asked, "Should we combine our financial accounts before we get married?" Our answer is, "absolutely not." Don't marry your money until you are legally married. We have seen too many engagements end, leaving couples who have combined their money with the painful task of sorting it all out during an already difficult time.
Naturally, if you are heading toward marriage, you probably already share your money with each other, but we're talking about things such as joint savings accounts, shared credit cards, retirement funds and checkbooks. Combining these finances before you've created a legal union can create headaches you simply don't need.
However, just because you're not sharing all your money yet does not mean you shouldn't be talking about it. A strong money relationship needs to start before you are married. Here are the six talking points to guarantee a smooth money transition into marriage:
1. Money Personalities. If you don't know what your Money Personalities are, drop everything and find out what they are. Understanding how each of you thinks about and deals with money is the foundation of a healthy money relationship. If you can't communicate about money, you have a long, painful future ahead of you. So, find out who you are, talk through how you are different from each other, and think about how you will compromise when the inevitable conflicts come up. If you do nothing else, do this: click here for a free Money Personality Profile.
2. Debt. There is no substitute for an honest conversation about debt. If you have some, tell your partner about it. Figure out how the two of you will pay it off. How will that debt impact your finances for the next few years? How can you work together to manage the debt? Lying about debt leads to something we call "financial infidelity" and will kill your relationship right from the beginning. Engaged? 4 Ways To Tell Whether Your Marriage Will Work
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3. Income. Get a realistic picture of the present and the future by talking about how much you make. It's amazing how many people don't really know what their spouses get paid. Not only will knowing this help you make plans for the first few years of your life together, it also helps prevent money secrets from creeping into your marriage. What Women Wish They'd Known Before Marriage
4. Expenses. Do you have a car payment? A gym membership? Medical expenses? Loan payments? Hopefully you have a good sense of how much money you spend in a month, but if you don't, this is a good time to figure it out. You should both think through every regular expense you have and write it down.
Combine those totals to get an idea of how much you'll spend as a couple, and compare it to your joint income. How does it look? If you have some wiggle room, that's great. But if you are spending way more than you're earning, you know you'll have some budget decisions to make once you start your life together.
5. Savings. Whether you have $100 in savings or $100,000, you need to talk with your partner about what you've got and what you're saving it for. Talk about more than just the amount you've got socked away; talk about how you got it there. How important is it to you to have money in savings? What kind of sacrifices have you made to put money away? What investments do you have or hope to have?
Planning for your financial future retirement, college funds, vacation or emergency money will be an ongoing conversation in your relationship and you might as well start having it now. Do NOT Get Married Unless You've Learned These 4 Critical Skills
6. Expectations. You've probably had a lot of dreamy conversations about your life together. But have you included the "how-we're-going-to-pay-for-this" part? Probably not. Eventually, couples that are headed toward a life-long commitment need to talk realistically about their vision for their future, and the implications that vision has for their finances.
Romantic? Not really. Necessary? Definitely. Cover everything. Do you want to own a house? How soon? Do you see yourselves living in a specific part of the country? What will that mean for your finances? How do you think children will change your financial picture? Will one of you want to stay home? Do you see yourself changing careers? Going back to school? Again, an honest conversation now can save you tons of heartache later.
Scott & Bethany Palmer are financial experts, authors, TV/radio personalities and sought after speakers. Their mission is to help people improve their relationships through a better understanding of their approach to money. Their new book The 5 Money Conversations To Have With Your Kids At Every Age and Stage hits shelves soon, order here. Check out Scott & Bethany's latest video: Money Smart Kids.
This article was originally published at The Money Couple. Reprinted with permission from the author.