A good marriage relies strongly on good communication. Yet so many couples neglect discussing their finances with each other, either because it’s an emotional subject or because they just don’t know what financial topics they should be talking about. Since money squabbles are at the heart of many divorces, it’s important to sync up your financial goals and philosophies in order to start off your marriage on the right foot. Here are four conversations you and your fiancé should have prior to tying the knot:
1. What is your spending philosophy?
Determine whether you and your partner are spenders or savers, what you both like to splurge on, and how your attitudes toward money within a marriage have been shaped by your upbringing. You may be surprised to discover that you both have differing ideas on how much each of you is allowed to spend without consulting the other or how much is too much to spend on a particular item. Once you unearth your philosophies toward spending, you can begin aligning them toward common financial goals.
2. What is your financial inventory?
Talk about your debts, including student loans, credit card debts, mortgages, and other loans. Look up your credit scores and share them with your partner. Discuss your bank balances, salary, and any other assets or investments you might hold. These discussions can lead to decisions on how you’ll handle debt and planning for future events such as retirement.
3. How will you manage your money?
Decide whether you’ll merge your finances or keep them separate, weighing the pros and cons and choosing what works for your specific needs as a couple. Set a budget that takes into account your current spending, earnings, savings goals, and any foreseeable changes to your financial situation, such as receiving a promotion or buying a house. You’ll want to discuss what your money management roles will be within the marriage—who will be paying monthly bills and handling the household finances? Who will track spending and manage the budget? It’s a good idea to have regular meetings with your spouse to go over your finances so you’re both on the same page. That way, one person isn’t responsible for sticking to the budget while the other spends money haphazardly. Merely keeping both parties informed is often sufficient for keeping arguments about money at bay.
4. What are your financial goals?
You should have already talked about how many children you’d like to have, where you might like to live, and what you want your lifestyle to be like in the future. Use these conversations to segue into talks about saving for retirement, investment objectives, and other future goals that will require a savings plan. These discussions can include aligning your goals, determining what will be necessary in order to reach your goals, and how you will stay on track.