Such a huge aspect of life, whether you want it to be or not!
If you’ve ever discussed combining finances with your husband/ wife/finance/fiancee/partner/significant other, you’re not alone.
Throughout the 18 months we’ve been living together, I’ve suggested several times that perhaps D & I should get a joint bank account and/or credit card. I looked up the information, grabbed brochures, and pointed out (first casually, lately insistently) that the money he has in his checking account would be much better held in a savings account where he would earn interest. In addition, seeing as we’re buying furniture and groceries together, why don’t we get a credit card together (preferably one with rewards) and split everything down the middle?
Yesterday he finally cracked (perhaps due to the prospect of planning a wedding?) and I arrived home to have him tell me that we were leaving to go to the bank and set up a joint chequing account and credit card.
With that (and many other things) in mind, I’ve developed my own short list of “rules” to consider before making your emotional relationship…financial.
- Know your partner’s spending habits! Hopefully this goes without saying, but if you don’t know where the money is going, that’s not good. Alternately, if your partner always has new clothes, ‘toys’ (ie. video games), or is always eating out or spending lots of money at bars, this should be a concern as well.
- Know your partner’s financial goals. Is your significant other saving up for a house…or a trip to the Caribbean? If you don’t know…find out! Why save money together is you’ll just argue about how to spend it?
- Discuss all purchases. D is currently lusting after a big screen TV – if I got home tomorrow and found that he had purchased one on our credit card…let’s just say that it wouldn’t be pretty. He would be upset if I bought a new snowboard – it works both ways.
- Agree on how much to contribute to a shared account. This will depend mainly on individual incomes. If there is a wide discrepancy between your incomes, agree on how much each of you would contribute (for example, an equal percentage of your paycheque).
- Ensure that you can make payments on time. Along with knowing spending habits, know payment habits as well. Does your significant other have a good payment history with creditors? Do you know if he or she has any creditors? What’s their credit score? For that matter, what’s *your* credit score??
Wow. That last one almost got away from me there! Don’t forget, these 5 “rules” are only a few things you should consider before making your emotional relationship financial. Above all, make sure that you are comfortable with the prospect. Talk to someone else about it if you need to. Talk to your banker! Someone working in the financial industry has likely seen this a multitude of times and may have considerations you haven’t even thought of. Don’t be bullied into it, and if you don’t feel ready – just say no!
** DISCLAIMER **
I am not a financial advisor. I’m just sharing my thoughts with the world.