It’s no secret that money arguments are one of the top predictors of divorce. Yet according to a 2019 SunTrust survey, only 51% of couples discuss finances before marriage. Even more surprisingly, only 41% of couples disclose their annual salaries, and only 36% bring up debt. If you’re one of these couples, you may be avoiding the discussion out of fear that financial difficulties could derail your wedding plans. However, merging lives also means merging finances, and if you can’t bring up money with your partner now, it won’t get any easier later. The more you put off difficult conversations, the harder they become. Also, failing to discuss such core life topics could be an indicator of howo you’ll handle things as a couple in the future – with a lack of communication.
Below are conversations to address before marriage:
- Views on money:
How we feel about money is often very emotional and very personal. Our family’s views on money can have a big impact on the way we see finances. In some families money may not be talked about. In others, one partner may hide money or their spendings from the other. While we might not consciously have these same behaviors, our upbringing will have an impact on how we feel about money and how we save, spend, and budget.
The best way to address unconscious – and sometimes conflicting – money behaviors is to start by recognizing how you each feel about money. Then you can take a practical approach and implement the best strategies from the past and incorporate them into your new relationship. This will also give you a chance to address any not-so-beneficial attitudes and behaviors and work to consciously change them.
- Spending/Saving Habits:
Chances are, the two of you don’t spend and save money the same way. The interesting thing about spending and saving habits is that they give insight into priorities, both financial and otherwise because we tend to spend money on things we feel are most important and scoff at spending on things we see as unimportant. Some people value saving more than anything and could be considered “tightwads”. Other people have a “live for today” attitude and spend whatever they have available, saving nothing or little for later. Most of us find ourselves somewhere in the middle.
Not agreeing on spending priorities can lead to serious conflicts down the line. While there is no right and wrong answer regarding priorities and habits, it’s valuable to know and understand each other’s habits earlier rather than later.
- The Bills:
This is an important conversation about how you will manage your money together. Will you have separate or joint accounts? Who will be responsible for paying the bills and investing for long term goals? A realistic understanding both of your current incomes and current debts is important so you can create a realistic budget based on your combined income and expenses.
- Credit History:
No one likes to talk about credit ratings because they highlight past mistakes and spending habits. Yet, it’s essential to know and discuss your credit histories. This can help you talk about past money mistakes, current debt loads, and how to address any issues that are lurking. Having this conversation now will also help if you’re planning to borrow money for a large purchase, such as a home or car. Credit history will affect how much you’ll pay in interest for loans, as well as how much it will cost for things like insurance. When it comes to credit, it’s best not to have surprises down the road, so it is advisable to have the conversation now.
- Life and financial goals:
What are your shared major life goals? Does this include starting a family?
How will these goals impact your lives, your careers or incomes, and your finances?
What financial actions will you need to take to support your shared goals? Asking questions about your partners’ life goals and dreams is helpful in understanding what is important to them, which more than likely has financial implications.
While these discussions may not be the most romantic ones you’re having, they do have the ability to bring you closer together. Planning together and sharing your dreams will give you better insight into the mind and heart of the person you’ve fallen in love with and allow you to become stronger partners when it comes to reaching your goals as a couple, emotional as well as financial.
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