Things are getting serious and by serious, I mean you are considering moving in together and opening a joint bank account to cover the bills and expenses. This idea feels romantic and shows a sign of your love and commitment to a future with one another. Ok, you can stop playing the violins now – the question is: are you financially compatible? Sadly, nine out of ten arguments between couples happen to be about money. Money is a very emotive subject and we all have our own unique way of using and spending it. It’s time to discuss the matter with your partner.
1: The “current state of your financial affairs” discussion: there are advantages in pooling your resources, especially if it comes to putting a deposit for a house or applying for a mortgage. But this only serves to be an advantage if one of you isn’t pulling the other down by having a messy state of affairs. The conversation you need to have will open up issues like the quality of your partner’s credit rating, how much they have in savings, how much their take home income is and what their commitments are. All very unromantic, but worth discussion sooner rather than later.
2: The “skeletons in the cupboard” discussion: If your partner has financial skeletons in their cupboard, their chickens will soon come home to roost. Have they ever been taken to court over a debt, for example? They may have the letters CCJ after their name, which means no lender will touch them. Perhaps, your partner is paying maintenance to an ex-partner. Do they have any “undeclared” children? All these skeletons need to be aired nice and early before it gets serious.
3: The “are you a spender or a saver” discussion: Your shrewd attitude may be to spend a set amount each month, then diligently squirrel whatever remains into a portfolio of investments including a high-interest account, Stocks and Shares ISA and a top up to your workplace pension scheme. But what good is that if your partner spends their paycheque even before it has hit their account? Your partner may be extremely grateful for having someone sensible to prop them up however how do you feel about it? Perhaps it’s time to have that discussion before it gets serious.
4: The “earnings” discussion: Let’s assume you’ve worked long hours, gone through your firm’s training scheme harassed your boss for that promotion and have now been rewarded with a challenging but high paying position within your firm. Your partner, however, cannot be bothered, hates their job, reluctantly does their nine to five and gets home nice and early in time for East Enders. Whilst I’m not suggesting that this is necessarily a problem for your relationship, wouldn’t it be nice to know this difference in attitudes before things started getting serious?
5: The “planning for the future” discussion: Are you the type to save for a rainy day? Have you got a long term plan and sorted out your retirement arrangements? Well, what about your partner? Do they have the attitude that they may be dead tomorrow so live large and spend it all today? These are important differences in attitude and need to be discussed nice and early in the relationship. Finding out stuff like this after you have settled down would surely be a recipe for disaster.
Step Change, the consumer credit counselling service, says that many people choose to keep their financial woes and debt problems a secret. Penny Galloway, spokeswoman for the service says, “My advice to anyone looking to start a serious relationship is to be open and honest at the very beginning. Although it may seem easier and more comfortable to lie, when you get found out, the resulting distress could be as bad as if you’d had an affair. It is possible for two people who have different attitudes about money to pull together and have a successful relationship, however, it is a good idea to have that important discussion sooner rather than later.” Wise words indeed.
