When it comes time to get married, it is important to be completely open about your finances. It can be difficult if you have made financial mistakes in the past. If you start out with open communication, it will carry through into your marriage. Here are the five most important financial topics to discuss with your partner before you get married. These topics can help you determine if you are financially compatible and the areas you will need to find a way to compromise.
Open the Finances Discussion
First, you should discuss any debts that you may each have. If you have student loan debt, you should not consolidate it together. There are many benefits that allow you to keep this separate. If you have credit card debt, you should quickly work on paying it off. Once you are married, you should only have one credit card account, and it should be a joint account. You should work on paying off all personal loans together. If you both own a home, consider the pros and cons of selling one home or renting one out and putting the other home in both of your names.
Second, you should discuss any assets that you own, which could be your retirement savings, homes that you own, cars, general savings, and investments. It is important that you begin to view these assets as mutual. Your retirement savings in 401(k) plans or individual retirement accounts (IRAs) are connected solely to you. You may choose to cash income investments or assets to pay down your debt.
Learn About Your Spending Habits
Third, you need to know about each other’s spending and savings habits. It is generally best if these are fairly similar, although you can adjust in different areas to help each other out. You need to be able to communicate effectively on these topics, and if you understand the reasons why you each like to spend or save, it can make communicating much more effective.
Fourth, you need to air out any dirty financial laundry. This is the time to confess if you have declared bankruptcy or have stopped paying on credit cards. You should make sure that you make a complete and full disclosure with your partner about any debt issues. This is especially true when you are thinking about debt. If your partner later learns that you have hidden something from them, it can cause serious trust issues in the marriage.
Share Your Feelings
Fifth, you need to discuss how you each feel about money. This is different than spending and savings habits. You may want to discuss the following questions: How did your parents handle their money? Would you do anything differently? Did you have to work for anything you wanted or did your parents simply provide you with it? Do you see money as a tool or as a burden? Do you like to save or give, or spend the most? Should you give money to others?
Remember to nurture your relationship by spending time together. You can go on cheap dates to keep the romance alive. It is also important to continue talking about your finances through budget meetings and goal-setting. The more open you are about your situation, the easier it will be to keep communicating effectively throughout your marriage.