Discussing Finances with your Partner Before Saying “I Do”
Alix Tucker, CEO of Finance with Alix
In a recent CNBC article, it was revealed that one-third of Americans admit to financially cheating on their partners. What is financial cheating, you ask? Anything that involves being dishonest about finances, like holding secret debt, spending more than their partner would be okay with, and having secret accounts or cards. With money comes emotions, and these issues surrounding money can often lead to misunderstandings, mistrust, and even the breakdown of relationships.
Before tying the knot, it's important to talk about finances with your partner.
From the moment my wife and I met, we knew there was something special between us. Our connection was strong, and within a short time, we could see a future together. One of the most critical conversations we had early on in our relationship was about our finances. Merging finances is a big step, and we had never done it before. It required a great deal of trust in each other, but more importantly, it meant we had to be open and honest about our financial goals and values.
We started by discussing our goals as a couple – what we wanted to achieve together and how we could best use our money to invest and save. We shared our feelings about debt and talked about the kind of purchases we should consult each other on, such as expensive items. We also shared our monthly and annual income and discussed how we wanted to allocate the money coming in.
After all those discussions, we decided that merging our finances would help us achieve our goals faster. We saw ourselves as married and wanted to put our money to work by saving as much as possible and investing in our dream project – building a hotel in Nicaragua.
These conversations not only brought us closer but also made us a stronger couple. We were forced to address difficult topics and ensure we were aligned in our financial values and goals early on, helping us avoid the #1 argument couples have (yes, money!). By asking ourselves some key questions, we were able to create a solid foundation for our shared financial future.
Here are some of the questions we asked each other, which could be useful for you and your partner as well:
What are your values?
Getting to know what your partner truly values can truly make a huge difference. Once you're aware of what matters most to them, it becomes a whole lot easier to come up with a financial plan that respects and supports those values. Having these talks can also help you both spot any potential conflicts and figure out solutions that work for both of you.
What are your goals?
Talking about your personal and shared dreams really helps create a solid game plan for your money matters. Think about the things you both want, like owning a home, raising a family, going on adventures, or even retiring early. When you're on the same page with your goals, it's easier to figure out where your money should go and make sure you're both putting in the effort to reach those milestones together.
Alix, CEO of Finance with Alix, and her wife, Kayla Nielsen
Do you have debt?
Being honest about any existing debt is essential for building trust and creating a realistic financial plan. An upfront conversation can help you understand the extent of your partner's debt, their repayment strategy, and how it may impact your joint financial goals. Together, you can decide whether to tackle the debt together or keep it separate, as well as how to balance debt repayment with other financial priorities.
Are you a spender or a saver?
Getting a good grasp on each other’s spending habits and attitudes toward money is key to financial harmony. When you figure out if your partner is a spender or a saver, it’ll be much easier to create a budget and financial plan that accommodates both of you. It’s always nice to compromise and find a middle ground so both partners feel their needs and wants are being considered.
How will we share our expenses?
Figuring out how to split expenses is a big deal when you're planning your finances as a couple. There are different ways to go about it, like sharing costs equally, dividing them up based on your incomes, or having each person take care of specific bills. The key is to have an open chat about it so you both can agree on a system that feels fair and transparent. That way, you can sidestep any potential misunderstandings or arguments later on.
Will we have a joint account?
Deciding whether to open a joint account can be a bit tricky. It's true that having one can make managing shared expenses and savings easy, but it's not always the right solution for every couple. To figure it all out, you can weigh the pros and cons together, like how convenient it is, how transparent your finances will be, and how it might affect your own sense of financial independence. A simple conversation can work out what’s best, whether that's a joint account, separate accounts, or even a mix of both.
The answers to these questions may not always be easy to discuss, but the process of asking and answering them can help build trust and understanding between you and your partner. Remember, it's essential to have these conversations early on, as they can help you create a financial plan that both of you are comfortable with and confident in.
Final Thoughts
Discussing money with your partner may seem like stepping into uncharted territory at first, but it's an adventure filled with rewards, much like discovering a hidden treasure. So, take the time to have these important conversations with your partner – you'll be grateful that you did.
As my wife and I have discovered, merging our finances has ultimately helped us achieve our goals and dreams together. Communication, trust, and a shared vision have been the keys to our success. And by asking the right questions and having open, honest conversations, you can also lay the foundation for a strong financial future with your partner.
If you're looking for more advice and insights on navigating finance as a couple, be sure to let us know in the comments below!