June is just around the corner, wedding bells are i n the air and I can “feel the love.” If there was one thing I could share with newlyweds, it would be that sometime between “Yes, I will marry you,” and “I do,” you need to have the “money talk.”
Couples don’t fight over love. They fight over money. They fight because they can’t balance the checkbook or one of them makes a major purchase without talking to the other person. Whether the issues are big or small, money will affect your marriage.
Here are the four things you need to include in the money discussion that will give you some insight into how money will flow through your marriage.
• Assets and liabilities. Take a look at what you both have and what you both owe. Assets are bank accounts, investments, cars, houses, and all of the other “stuff.” Liabilities are everything you owe, including loans, credit cards, collections, bills, etc.
The goal as a couple should be to discuss where you want to go together. That might be how much you want to save, whether you want to own a home, your attitude toward automobiles, vacations, travel, hobbies and other interests. You should also talk about how you would use credit and debt and the amount of debt you each have, because now you are going to pay off your existing debt as a family.
• Your money history. Talk about what you experienced financially as a child; how your parents managed their bills, what they taught you about saving and spending. Compare your backgrounds. Discuss how both of you look at money and discuss your spending and savings habits. Then find a common approach for managing your money successfully. Marriage is about compromise. A better understanding of how you each see and use money will give you the tools to find a middle ground and foundation to build on.
• Share financial duties. Come to agreement on how to divvy up the various financial responsibilities from paying bills to balancing the checkbook. Work together on developing a budget and how to monitor it to help you achieve your financial success. Remember you both have an obligation to the family’s financial well-being, and need to be fully aware of the household’s financial situation.
• Combine accounts. When you said, “I do” you agreed to be a team. That means we no longer have “yours” and “mine” income. You have “our” income and expenses. Don’t be afraid to set up multiple accounts to help achieve your goals.
Over time, you will have arguments about what and when to spend money, and will have to work on setting your family priorities.
It is not money that is the problem; it is lack of communication and some times the lack of knowledge about each others personal financial quirks and beliefs. Talking about money early and often will help reduce the financial tensions that are normal in all