Financial commitment: talking about money in your relationship

Talking about finances can be a bit challenging. Adding a relationship into that conversation can make the conversation feel even more stressful. However, with some open and honest conversations, finances and relationships can blend together much more easily. From spending habits to debt to prenups, we offer up our advice for how to talk money with your partner.

How soon should you talk about money while dating?

This can be done very early in a non-aggressive way – looking over some’s bank statements during the first date is not okay.  I suggest starting on or even before the first date with a discussion about who will pay and why.  It can also be a discussion around if this is going to be the expectation moving forward. Breaking down expectations helps to manage disappointments – this is huge in not only romantic relationships but all interpersonal relationships.

How do you bring up the topic of money for the first time?

 Again start early, start casual.  As the relationship develops the deeper you can go into the topic.  Just as other conversations will get deeper, so should the money talks.  Since so many things can be tied into money and money values/ideas it’s important to name them and discuss them.  “Oh you want to go back to college – that’s great.  Have you looked into scholarships/grants?”  Making sure you are okay with where the person stands.  Don’t try to change someone’s money habits if they are not wanting to change – seek to understand and either be okay with it or determine how that will impact the relationship long-term.

What should you do if your partner refuses to talk about finances?

Money is one of the leading causes of issues in relationships, so this is definitely a hard one. If you are committed to the relationship and working through the financial differences – there’s hope.

First, try to have an open, honest, and judgement free discussion on finances. Also, know there is no “right way” to do couple finances. If you are a spender and your partner is a saver, it may help to have separate finances so it’s not causing issues. If your partner doesn’t want to talk, then explain what you need from them. Typically not talking is a symptom, not the issue.

What are some financial questions that you should ask your partner?

I personally love hearing about a person’s history with money.  Asking questions like “What did you learn about money growing up?”; “What’s something you saved for as a kid?”; “Was there anything you had to pay for as a kid/young adult/etc that other kids didn’t?  How did that impact you?”

The key is to not have any judgement with the discussion – either about your partner or others that formed your partner’s current values around money.  Understanding your partner and where they come from will help you to understand their current values and goals with their finances.

What are the pros/cons of combining financial accounts with your partner?

The pros: Ease of one account; both on the “same page” physically to be able to communicate about finances openly – no secrets.  

The cons: Too many hands in the “cookie jar” – easy to spend without thinking of bigger picture; judgement and finger-pointing on who’s spending and what’s “not okay”; no ability to surprise the other person with a gift, trip, etc.

Personally I feel that having one account combined (either savings or checking) is good but keeping some money separate is not only okay but encouraged to stay independent and feel “free.”

How do you tell your partner you’re in financial trouble?

This is a hard conversation but waiting will only make it harder. Being open with your partner and letting them know at the first sign of a problem is best. If it’s too late for that, then consider what’s the best way they need to be approached. Are you asking for their help? Have you already looked into help (ex. financial counseling) and just need them to know and be supportive of you? Letting them know that your situation with money doesn’t change your feelings towards the relationship or them will go a long ways. Then, tell them what you want/need from them? Help financially or just help to stay accountable and be strong?

What should you do if your significant other has financial baggage?

Knowing that their financial decisions probably have very little to do with you personally is the first step. Then, do place blame, but also don’t try to swoop in and fix it for them. Be supportive, know your own limits of how you can and cannot help financially and be honest with that. Encourage them to set up a financial counseling appointment and then offer to go with or look over the information with them.  You are not responsible to take on the baggage, but you want to support your partner while they deal with it.

Do married couples share a single credit report?

Your credit is tied to what is borrowed under your name/social security number.  Therefore, you and your spouse do not share a credit report or score.  If you have bad debt before marrying, you will continue to have it until it is addressed.  If you have good credit, a spouse with poor credit will not “hurt your credit”.  Marriage in and of itself doesn’t hurt or help your credit. 

The only thing is that could impact your credit is how you pay for the wedding and expenses after marriage – meaning if you take out a lot of joint credit cards to pay for the wedding, then that will impact your score and credit reports.

How do you know if a prenup is right for you?

A common myth is that prenups are only for those with money and assets at the time of getting married to ward off Kanye’s “Gold Digger”, but the reality is there are many different reasons to get a prenup.  

Divorce happens – we don’t enter into marriage thinking this, but a prenup helps us to keep grounded and manage expectations. Having the discussions about finances, if it comes to divorce - before getting engaged even - helps to prevent issues in the wake of a divorce. Taking the emotion out of the prenup/marriage and thinking of it as “dissolving a partnership/business” may be easier for some.  Talk about how you would split the assets, cash & debts but also how you would move on. 

The new trend in prenups are “Social Media Clauses” which says no airing dirty laundry on social media. If either person involved does, there’s a fine. 

Already married or feel the prenup is outdated?  Get a postnup – yep it’s a thing and people use them to keep everything updated.

What is your #1 money tip for couples?

Communicate!  Your partner is just that – your teammate, the person that will help you to achieve mutual goals.  It’s hard to do that without communicating.  Talking about goals and planning them out is huge, then check-in with each other.  Even if you are “doing okay” with finances, there are still goals you have and that still needs to be communicated and planned together to ensure there are no feelings of resentment, misunderstanding or hurt feelings.

If you and your partner could use guidance achieving your financial goals, call us at 888.577.2227 for your free session or Get Started Online at your convenience.

These questions were answered by April Sanderson, an LSS Financial Counselor. All questions are a part of Experian’s weekly Twitter chat.