In honor of Valentine’s Day, I want to address the tough question of finances and relationships. Whether you’re preparing to get married, move in together or have a baby on the way, your finances affect your partner and vice versa. When thinking about how (or if) to combine finances with your partner, opening an honest line of communication about your finances is imperative. Don’t worry about finding the best way to go about this sensitive subject—you won’t find it! Instead, find the way and time that’s right for your relationship.
Have the Conversation
The complex and delicate issue of money is difficult to approach without conversation. Talking lets you to evaluate your partner’s commitment, financial goals and expectations—and they yours. Will you need to discuss every purchase together? Will you both live a frugal lifestyle? Is your partner a saver or a spender?
There isn’t a right or wrong answer today. You and your partner just need to know where you each stand. Right now, you’re only making a decision about whether to combine finances with your partner or not.
Make Financial Plans Together
No matter what you financial set-up you pick, your choices still affect each other. So sit down together and plan! Evaluate your income and where you spend. Feel free to talk about what you plan to purchase or what you want to save for. Even if you decide to combine finances overall, I recommend keeping your Everyday Accounts separate. Both of you need room to spend a set amount without accountability. But always keep the focus on your future Financial Freedom–whether you’re working toward it together or separately.
Be Transparent with Your Partner
Regardless of whether or not you open a joint account or keep everything separate, you still need to be transparent with each other. Combine finances with your partner or not, but be honest from the beginning! If you have debt, don’t wait to tell your partner. Hiding purchases and creating hidden accounts will damage your trust relationship. Be open and communicate frequently about your finances.
Pick the Best Way to Combine Finances for YOUR Partnership
Combine all your bank accounts, share credit cards, contribute to a joint account or keep everything separate. No option is more foolproof than the other. Everything depends on what you and your partner are comfortable with, and there are several different approaches. Disagreements and arguments usually don’t stem from the method of financial unity but rather from financial infidelity. Commit to the way you want to combine finances. But don’t be afraid to change later if you and your partner decide to try something different.
No relationship or financial situation is going to be exactly the same. So don’t be afraid to modify what others do to suit you. And don’t be discouraged if your financial lives don’t mesh initially. Be patient as you establish your path to Financial Freedom!
image credit: Bigstock/DavidPereiras, Wavebreak Media Ltd
Dr. Tony is the co-founder of MindShift.money and the best-selling author of three books on personal and business finances. Having achieved Financial Freedom at 27, Dr. Tony believes that through Financially Fit Bootcamp and Cash Flow Cure everyone can get there. He has made it his life’s mission to help others live a life where their money works for them—not the other way around.