When you are in a relationship, there are a lot of things to discuss once a future together becomes a real possibility. Chief among them are children, religion, and FINANCES.
When it comes to handling money with a significant other, especially in the beginning, there are a lot of things to talk about, and somethings may not be discussed simply because you didn’t think of them. I’m a firm believer that the best way to avoid money fights in a relationship is to talk about money early and often. But how much information is too much, and when is the best time to broach the subject?
Money conversations don’t necessarily happen all at once. There should be a lot of money conversations throughout your relationship, so you can get a good idea of your significant other’s views on handling finances. Eventually, having a conversation about whether you will combine finances should come up. I recommend waiting to combine finances until after you’re married, simply because of the legal aspects, but that doesn’t mean you can’t have the conversations about your financial situation and what combined finances would look like.
Ryan and I didn’t combine bank accounts until after we were married, but we managed our money jointly prior to getting married. That included talking about financial matters, knowing each other’s financial situation, and understanding each other’s views on money.
That said, financial discussions are not linear. There are a lot of twists and turns. A lot of information and perspectives to share. It’s easy to leave things out unintentionally. To help you avoid that, here is a list of financial disclosures you’ll want to discuss once the topic of money is on the table.
- Debts: Since debt is so common, it’s likely that you have debt payments that go out every month. Before combining finances, and even when you’re just talking about money as a general topic, talking about outstanding debts is really important.
Not only will it give a good sense of each other’s financial situation, it will also reveal things that are important to each person. Is the bulk of the debt on credit cards or is it for things like boats or cars, medical bills, or payday loans. Knowing each others’ debt load can tell you a lot about the other person.
It’s also important to disclose if any of those debts are outstanding or in collections. It will help you get a good idea of the other person’s ability to manage their money. If debts are outstanding, that’s not necessarily a red flag if they’re actively working to fix the situation.
- Loans: I put this in a different category than debts because larger loans or family loans aren’t always thought of in the same category as, say, credit card debt. Make sure to discuss any home loans, personal loans, or loans from family members. Again, this gives you a good idea of the overall financial picture.
- Child Support: If you have kids from a previous relationship and either pay or receive child support payments, this should be a conversation that you have before deciding to combine finances. If you receive child support, you should also explain how you use the money (whether it goes into the monthly budget, is only for kid related expenses, goes into college savings, etc).
- Financial Support of Family or Friends: If you give financial support to family or friends, you should explain this to your partner. Up until you combine finances, you are the one making the sole decisions about how to handle your money. But once you combine, you’ll have to come to decisions together, so it’s important that your partner understand any financial obligations you have to family or friends and support their continuation (if you want to continue). Make sure to discuss the time frame of this support as well, namely whether or not it is ongoing or temporary and what the understanding is between you and the other person.
- Donations: If you actively donate, it’s important to talk about this with your partner as well. Whether it’s tithing to your church regularly or making donations here and there to causes that you want to support or ongoing support of a foundation, your partner needs to understand the importance of these donations.
- Income Sources: Thus far, the financial disclosures have been about money that is obligated elsewhere, but it’s also important to discuss money that’s coming in. Sharing your income sources, especially in the age of multiple income streams, can help get a full pictures of the other person’s finances. Whether all of the income comes from a 9 to 5 or you’ve set up other income streams such as dividends from investments or freelance work, make sure to share it all.
- Investments: If you have investments such as an IRA, mutual funds, stocks, CDs, etc. definitely add them to the list of things to discuss. As your relationship gets more serious, discussing what the future might look like will probably take retirement into account. Understanding what things look like individually will help you see what they could look like together.
When should we have these talks?
As I see it, there’s no hard and fast rule for when to have money conversations. No matter what stage you’re at in your relationship, money conversations (and observations) can be happening. The depth of the discussions depends on each individual couple. Ryan and I started by talking about our incomes, debts, and savings as well as how are parents handled money. As we got more serious, we talked about what it would look like when we started managing money together.
Money touches every aspect of our lives and disagreements over money are a huge contributor to relationship problems. Talking about money early and often can help alleviate some (if not all) of the problems, especially if you’re honest and open from the get-go.
Check out the links below for more posts about how to manage money together with your significant other:
- How to Combine Finances with Your Spouse
- 4 Benefits of Managing Money Together
- Managing Money Together
- Why Are Money Conversations So Darn Difficult?
- How to Handle Different Financial Styles in a Marriage
What are some things you talked about with your partner before combining finances? Are there things that you didn’t discuss that you wish you had?