For a lot of couples, money can be a sensitive topic-especially when the relationship starts to get serious. Now, there’s no single right way to manage your finances as a couple, but having open and honest discussions about your money can be key to avoiding misunderstanding and strengthening your financial future together. Whether you’re just beginning to share financial responsibilities, or you’re thinking of merging accounts, here are a few ways you can get the money conversation started so you can figure out what works best for the two of you.
One way to start the conversation is to talk about your current income and financial responsibilities. Even if one person currently earns a lot more than the other, it’s a good idea for both partners to be involved in financial decisions that affect them. Consider shared expenses. No matter how you manage your bills, agreeing upfront on which expenses you’ll share as a couple and which you’ll cover individually can make paying your bills a little less stressful. It can also be helpful for the two of you to talk about any debts or other expenses that impact your individual budgets. This could be anything from student loans to credit card debt, child support or other expenses. Whether you decide to keep these financial responsibilities separate or manage them as a couple, discussing these costs openly with your partner can help him or her understand the financial pressures you might be under.
Next, take some time to think about the things you hope to achieve in the next five, tenor thirty years and then talk together to see how you’re personal and financial goals agree or differ. One person’s goal might be making memories spending more on travelling, or dining out. While another’s goal might be to trim expenses in order to pay off debts or save for a down payment on a house. By talking about each other’s goals and agreeing on which goals the two of you will prioritize, you can begin to find ways to balance both of your expectations for the future. Then you can start working on a joint budget to help you reach those shared goals. Go over your income and expenses together to decide what costs you can reduce and which you agree to keep. Then you can start setting aside money for your shared goals. Whether you’re building up savings for a travel fund or learning to live on one person’s salary so the other can stay at home with the kids, creating a joint budget can help you keep on track to meet your joint goals.
In order to keep the money conversation going over time, you can set up dates to look at your spending and savings and see if you’re on track to reach your goals. As your priorities change over time, you may find that saving for a down payment on a home might become more important than dinners out or your next big vacation. In any case, setting occasional money dates can help both of you feel confident about your financial goals and can help you avoid conflicts over spending. At a certain point, the topic of joint bank accounts might come up.
Now there’s no single right way for couples to set up their accounts. For instance, you might both prefer the independence that comes with keeping separate accounts, or you might prefer a joint account so the two of you have equal access to all of your money. Or you could choose to keep a mix of separate and shared accounts, with separate accounts for personal spending and shared accounts for your shared expenses and savings like your family’s emergency fund. This can be more to manage, but keeping a mix of separate and shared accounts can make sure your needs are met as individuals and as a couple. No two couples are alike, and what works for one couple might not work for another. But by having open and honest discussions about money and making financial decisions that work for both partners, you’ll be better prepared to reach your personal and financial goals together.
Source: Bank of America