Managing Your Finances In a Relationship by guest writer Natasha Andrews.
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When it comes to love, it isn’t all long, candlelit dinners and romantic walks in the park. At a certain point, reality sets in — especially if you decide to live together, get married or commit to a long-term relationship without getting married.
Deciding how to handle your finances is critical to a healthy relationship. Stress over money is a leading cause of relationship problems. If spending styles are out of sync or a couple does not execute effective communication about financial goals, it could spell disaster.
With that in mind, here are some of our best tips for managing your finances in a relationship.
First, have a frank discussion about your financial status and goals. The scope of this conversation will depend largely on what level of commitment you are in your relationship. Whether you are in the early stages of your engagement, or recently married, you need to get serious about your financial situation.
Both partners should "lay your financial cards on the table" such as assets, but also all debts and liabilities such as credit cards, student loans, etc., and be willing to discuss income, expenses, short term, and long term career goals.
These conversations will involve your practices on budgeting and saving. Getting a handle on these ideas and practices can be difficult, but if you commit to talking through your different ideas and plan a course of action together, it can be accomplished.
Next, consider opening up a joint account for certain expenses such as bills, purchases, and vacations.
The idea is that a joint account will help you work together towards common financial goals, while still allowing you to maintain your individual accounts. If you have decided to not marry, but move in together, you will want to think new legal and financial strategies.
A break-up can be emotionally difficult, but when you add in a shared living space and shared purchases, separations can get ugly. Consider meeting with a lawyer to form a version of a common law partner contract. It isn’t romantic, but it will save you problems down the road if something should happen.
Some options to keep in mind, it may be tempting when you're in a relationship to co-sign a loan for your partner and the like, because you might have better credit, and open the opportunities for your significant other to receive a better interest rate. But if the relationship ends, you'll be held responsible for the loan if it isn't paid.
Managing your finances in a relationship can be challenging, particularly when the relationship involves two people with different spending habits. But with open communication, planning and commitment, you may find that working together to reach financial goals brings you closer to each other.
Disclaimer: This article is a guest post, and the views expressed do not necessarily reflect the views of James Russell Lingerfelt.
Read another popular post: Don’t Ever Apologize For Loving Someone – Not Ever!
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