Money can be a serious issue in many relationships, be it between spouses, parents and children, or friends. In the first of our new series of blog posts about money in relationships, let’s take a look at the financial decisions you will have to take when you decide to move in with a partner.
Joining financial forces
The decision to live together is a milestone for any two people, be they partners, engaged, or married. With the excitement and eagerness to please that many couples display at this stage of a relationship, money may be an issue that is never discussed – but this may not be wise at all. Considering how many couples argue about money on a regular basis, it’s important to discuss money matters early on in the relationship and join financial forces instead of becoming financial enemies down the line.
Speaking to your partner about finances may not be easy, and if you sense that it will be an uncomfortable issue, you could always arrange a meeting with your financial advisor to discuss the issue plainly and openly. In general, most couple manage to discuss their finances quite well by themselves, and when you do have the “money talk” with your partner, remember to discuss the following topics:
How much each person earns
This is often a sore point for some people, especially those who feel uncomfortable earning less than their partners. However, as soon as you know how much each person earns you’ll be able to understand the other person’s spending habits and financial goals a lot better. Being open about your incomes will also help to build trust in the relationship over time.
Decide who pays for what
Many couples decide to split the household expenses in two, with each person contributing equally to the rent or bond, utilities, grocery bill, and other expenses. However, if one partner earns substantially more than the other it may be necessary for the higher earner to contribute more to the household.
Make sure that you are clear on who will be responsible for what payments each month as soon as you move in together, or even beforehand. Remember that each partner should be left with surplus money to spend or save at the end of each month, allowing both partners to have their financial independence once the household expenses are covered.
By discussing your household finances in depth, you’ll be starting out on a solid footing when you move in together. Remember that openness and honesty are the building blocks of every good personal and financial relationship.