To have a long-term relationship that works, a couple usually has long-term goals, but having financial goals is also a part of this. Talking about money and money issues is necessary. Open communication and clarity when it comes to financial matters is very important. Worked-through financial plans and goals is key. Getting to know your partner in many different ways is important and getting to know him/her financially is one of these ways.
•Sit down and be calm, take all the emotion out of the talk.
•Compromise. Talk through issues, who needs what, what is important to each person. Be flexible. Try to understand that the other person is not you. He/She has different needs, wants and goals. For example you might want to spend money on clothes and shoes and your husband/partner/boyfriend wants to buy a surf board, go out with the guys, take a vacation. What is important in the beginning stages is to be able to feel the freedom to talk to the other person without judgment and criticism. Work on resolving differences. Give yourself time to grow and learn. Be respectful and calm when you are having these discussions.
•Try to look at your spending plan and provide a way for all goals to be met. Both people in the relationship need to feel satisfied and happy. If one of you doesn’t, resentment and anger will build and this can tear apart your relationship. It is very important to be honest with each other.
•Talk about money and the day-to-day management of money. When both partners are involved in the money making decisions, both partners take responsibility and ownership for their relationship.
• Be sure not to take on your significant other’s debt. However talking to him and/or sitting down and helping him with a repayment plan without judgment or a “better-than-thou” attitude is helpful.
•Consider a pre-nuptial agreement before marriage. Prenuptials protect yourself and your partner. They are written out of mutual respect for both of you.
•Discuss retirement goals and savings.
•Go over each of your spending habits and how that effects you as a couple. For example if one of you has a compulsive spending habit or a hoarding habit, address it openly and honestly without blame, shame or guilt. No one is perfect, and spending habits can be changed.
•Once you both are in a committed long term relationship, money goals and desires should be made together as a couple. Buying homes, taking vacations, saving for education of schools, retirement etc. Decide together where to invest, go over the monthly expenses together, the spending plan, the timing of purchases, engage in all the decisions, ask questions, be clear on money issues. Sometimes the higher earner takes it upon herself/himself to make all these decisions. However leaving out the other partner can cause resentments, anger, feelings of not being a part of. Also the lower income earner feels that she is ‘giving away’ her power and doesn’t have a say in the relationship. This imbalance of power can tear apart a relationship. Always remember a partnership, a team, works together on all issues; including money matters.
•Financial independence is important for each of you, in addition to the financial partnership you have together. It is important for each of you to have our own financial identity, just in case something happens and you are single again. For example I suggest each of you keep one or two credit cards and bank accounts in your own name so you maintain your own credit report.
•I suggest a shared checking account for household bills and a shared credit card for agreed to partnership expenses. Each partner should contribute the shared account based on his or her income levels. For example if the higher income earner makes twice as much money then he/she should contribute twice as much to the shared account. Please remember the shared account is for talked about expenses not for shopping sprees, personal expenses etc.
