Investing in Love
Balancing love and money in relationships
So you’ve decided it’s time to take your relationship to the next level. Well, if you’re ready to move in or walk down the aisle with your partner, there are a few big conversations you should have – not to mention some big decisions to make before you move in together.
The key to successful relationships is having open conversations about everything. And balancing love and money definitely requires openness, trust and honesty. So, here are five handy tips to help manage money in your relationship.
Talk openly about your individual financial positions
You may have discovered a lot of different things about your partner (their likes and dislikes), however one area you may not have shared as openly with each other is your finances. Apart from chatting about all your exciting plans for the future, it’s just as important for you and your partner to talk about the one thing that plays a role in all these other plans – money! We know, we hear the groans about it not being very romantic, but it’s really important you both share where you stand – particularly at the start of the next chapter of your relationship. Talk about and decide what you’re prepared to put into your joint assets that will help you reach you and your partner’s life goals.
See if your values, attitudes and financial goals are aligned
If there was a ‘Relationships 101’ course it would probably suggest that successful partnerships require couples to have more things in common than not. Finding out all the things you share is also part of the fun of a relationship. Some things may be more likely to impact your relationship over the long term, like buying a home instead of renting, your attitudes towards debt, or having kids together in the future. It’s best to understand each other’s values, attitudes and financial goals early so that they don’t become big points of difference in the future. Before you discuss your day-to-day spending, both of you should ask yourselves some questions: Is money for saving or spending on life’s pleasures? How do you both feel about debt? What is your appetite for risk when it comes to money? Answering these questions will help you discuss how you can achieve your goals for the future.
Know how money smart you are and learn more if needed
Unfortunately there is lots of financial jargon out there. Whatever your level of financial literacy, having an understanding of the basics is vital for individuals and couples alike. If it’s a very basic understanding, try to learn a little more – it may help you avoid common mistakes and even take advantage of opportunities. Taking more of an interest in where your money goes and how it can work harder for you may also help keep your money stress levels down, so there are lots of rewards. When it comes to money, knowledge is powerful.
Talk about the management of joint finances
Everyone has their own attitude towards money and this will more than likely influence how you manage your finances – not just in the day-to-day, but also in the long term. Add someone else into the mix and well… things change. Moving in together means you’re both investing in something more than just a future together. There are also things to be shared like grocery expenses, utility bills, as well as the rent or home loan repayments. It’s a good idea to sit down and talk about how you’re going to manage these joint expenses and who will do what to pay them. Ask if all the costs will be split 50/50, or will you each take on some expenses? This can matter, especially if one of you has a much higher income – do they pay more, or is it ‘even-stevens’ for everything? The good news is that splitting the bills (whatever the percentage) will usually be less than what you’d pay on your own. Plus, life as a couple brings loads of opportunities to save money. Consolidating things like streaming services and health insurance can really save money and boost your savings for things like saving for a house deposit. Combining your banking products is another quick way to make some savings by reducing the number of fees being paid – just be sure you both trust each other with your money.
Engage a trusted financial expert for support
Unless you’re a complete financial guru, having a trusted sounding board can make a world of difference. Just getting another independent opinion can help you avoid a big financial mistake and make the most of opportunities. By engaging the support of a paid expert, a free financial counsellor or someone from your bank, you’ll be able to ask questions, bounce ideas and get the help you both need to plot a successful path to your financial goals.
Life can be full of twists and turns, whether it’s starting a family, moving house, managing the household or changing jobs. Learn to be flexible and adapt to the situation in front of you. Remember, most big financial decisions have to be renegotiated over the course of your relationship – not many things are set in stone.