How to Talk about Money in Your Relationship?

Money is the number one reason why people get divorced in this country. It’s such an emotional subject, and most of us are never taught how to handle our money, never mind, discuss it. I remember clearly learning how to make out a check in elementary school, but that's about it. My financial education came a bit from my parents, but largely from trial and error. You’re going to laugh, but when I was 19 years old a psychic told me that I would never have money issues. From that day on I stopped balancing my checkbook and let the universe take over.

I know I am crazy and lucky. And you may be in the same boat, or you may have a completely different experience.

So, how do you talk about FINANCES relationship?

When I coach couples heading into marriage, we always have a discussion about money. Even if one of the pair works in finance, even if they’ve already started merging their money. It’s a chance for each partner to share their expectations and fears. To talk honestly about knowing how much there is, where it comes from, and where it goes. But more importantly, it allows them to create a vision and hopefully a plan for the future. Is this an easy conversation? Maybe, maybe not. But if you share from your heart and listen with an open mind, it’s a great start.

You may need your own time to consider your own relationship to money. I am currently reading The Psychology of Money by Morgan Housel. However there are a ton of books and podcasts out there that will bring you perspective.

Here is a list of questions to get you started.

I encourage you and your partner to go through each of these. Give yourselves plenty of time. Fully express your expectations and fears and have the patience to truly listen to each other. Be open to all thoughts, questions and be aware of your emotions and judgments. It may be helpful to write your responses and then share them later. Especially if you need time to reflect on your answers.

1. How do you think your upbringing, culture, and gender influence how each of you approach money? Are you a spender or a saver? Do you know what your financial personalities are? How do you define luxury?

2. Where does your money come from? Do you each bring in similar salaries? If not, is that okay with both of you? What would happen if one of you no longer wants to or no longer can work?

3. Where does your money go? Even if your budget is a general one, it is important to know how your dollars are being spent. Do you have separate individual and/or combined budgets?

4. Do you want to have joint or separate banking accounts? Or some combination of the two? Do these should include checking, savings and investment accounts.

5. Who actually sits down and pays the bills? Do you do this together or has one of you volunteered for this task? You may need to reevaluate, if the way you have this set up is not working.

6. How much do the two of you owe in debts and what are your assets?

7. Do you have any financial goals for your future? If you do, re-evaluate the progress you are making toward your goals. If not, make some goals, both short-term and long-term. These should include retirement, home repairs, emergency funds, the kids college fund, etc.

8. Where are the two of you most vulnerable in your finances? Is it a lack of job security, over spending, not enough income, too much debt? Decide together how to strengthen your financial position.

9. Do you know your credit record? 
If either of you has a poor credit score, it may prevent you from qualifying for a loan or getting a low interest rate, if you apply jointly.

10. Is there a plan to protect your financial security?
 Review your health and life insurance to look for ways to save as a couple and to ensure your coverage is adequate for the two of you. Update your wills and investments to ensure that your future spouse is named as beneficiary, if that is your wish. 

11. Do you both know where important documents are? These may include insurance documents, wills, tax information, bank account numbers, and investment information. Someone may need to access in case of an emergency. If that is your partner, please make sure they know where things are.

Were any of these a challenge to answer? How do YOU discuss money in your relationship? If I can help you guide a conversation on finances (or any of the other Big Issue topics), please let me know.

The discussion on money may generate more questions than it answers. If it becomes overwhelming, I encourage you to enlist a financial professional. Figure out what type of help you need and then ask your friends, colleagues and family in your area for a recommendation. Don’t settle until you find someone you truly like.