When Is It Time to Talk Finances With Your Partner?

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I was recently out on a date when something strange happened: The guy I was having dinner with very openly started talking about his finances. Mind you, this was our first date.

Maybe he felt comfortable because I talk about money for a living. Or maybe I have a face that says “I won’t judge you.” But this was very much a first for me. In my experience, people tend to avoid this subject like the plague when dating.

The data suggests I’m not alone. According to a recent study by SoFi, 39 percent of millennials would rather disclose a preexisting sexually transmitted disease to a potential partner than tell them how much debt they have. 

Unfortunately, avoiding the money talk when dating leads to a vicious cycle of sorts. “Out of sight, out of mind” becomes the norm, and we might even avoid it until after the wedding. Then, one day, we wake up and we realize we’re in one heck of a financial mess.

There are plenty of horror stories about relationship money disasters, from secret bank accounts to disastrous stock market losses to massive secret debts. In one extreme case, I had a friend whose identity was stolen by her ex-girlfriend, who proceeded to rack up $30,000 of credit card debt in her name.

And even if they don’t end in financial ruin, fights over money are right up there with infidelity in the list of common causes of divorce.

Just as a partner can’t trust you if you’ve cheated on them with someone else, they also can’t trust you when financial infidelity has occurred.

That’s why it’s in our best interest to start having financial conversations with our partners early on. Here are the money conversations you need have at each stage of your relationship.

The Honey Moon Phase

Ah, the honeymoon phase. This is when everything is lovely, our endorphins have us on a high, and we still think the other person can do no wrong.

It’s no wonder, then, that having a talk about finances at this point may seem like the least sexy and least romantic thing you could possibly do. Why kill the vibe, right? And, truth be told, it may be awkward to talk about money this early on (unless you’re my date from the other night). But before you get any deeper into this relationship, it’s important to know what you’re working with.

One way to start bringing up the financial conversation is to talk about what each of you value and what goals you have.

Values and goals usually have some sort of monetary value attached to them, so it can be an easy way to segue into the more uncomfortable topic of money. For example, wanting to travel the world or start a business will require some sort of financial conversation. Just about anything anyone wants to do will involve money somehow.

Elle Martinez of Couple Money suggests easing into it with questions like “What do you want to do by the end of the year?” or “Where would you like to live in five years?”

“Once you two figure out what where you want to go, it's much easier to review the numbers and come up with a plan to get there,” she says.

“With that goal, you can open up with some of the numbers.”

She also notes how you can do a test run in supporting each other with these goals. As the relationship progresses, she suggests working together on mutually beneficial goals.

Another thing you can do early on is talk about upbringing. After all, you’re getting to know each other right?

“One way to broach the topic is to ask how money was handled in their family,” says Valerie Rind, author of Gold Diggers and Deadbeat Dads: True Stories of Friends, Family, and Financial Ruin. “Was it taboo, or were their parents more transparent about the family finances? Was credit card and other debt an accepted part of their lifestyle? Was saving money a priority? Their responses might give you an initial peek into how they handle their own money.”

It’s at this stage in dating when you should see whether or not a relationship is the right fit. Unfortunately, it’s also the stage we tend to bulldoze through in order to focus on the fun parts.

The “This Is Getting Serious” Phase

Once you get passed the honeymoon phase, things may start getting more serious.

“This isn’t the time to be coy,” warns Rind. “Discuss things like your salary and other income, assets, and debt.”

Rind also warns that the negative side of the balance sheet — that is, debts — isn’t the only place in which a couple may be incompatible. The reality is your partner can be wealthy and used to a certain lifestyle while you’re accustomed to stretching a dollar.

The important thing is that this conversation happens before the all-important next step: Moving in.

Moving in Together

Most people move in together to save money, but according to Rind, that may not be the best reason to do it. She believes you should move in together because you’re committed.

“What happens when you break up?” she points out. “You could be stuck in a dreadful situation where one partner might not be able to live on their own. Plus, untangling yourselves and your possessions can be as difficult and contentious as a during a divorce,” she warns.

So at this stage, couples may want to have a talk about their relationship to make sure they are moving in for the right reasons.

Engagement

Hopefully by now you’re fairly comfortable talking about money, and most of the important points have been covered. At this point, you’re simply adding to an ongoing conversation.

However, you need to make sure the following money topics have been discussed and accounted for:

  • Income (wages, dividends, passive income) and deductions
  • Businesses you own
  • Money loaned to other people, whether family or otherwise
  • Any current debts
  • Savings, investments, and ongoing contributions
  • Charitable contributions (a good indicator of what your priorities are)
  • Children (whether you want them, and how they’ll fit into a financial plan)
  • Bad stuff: addictions, arrest, and jail time
  • Retirement plans.
  • Budgeting habits
  • Wills, trusts, powers of attorney, and advance directives (Rind states how it’s critical to keep all these up to date during your lifetime.)
  • Tax returns

If you’re overwhelmed reading this list, take heart: Rind says you don’t have to actually agree on everything, or even most things. The important part is you each get where the other is coming from.

Final Thoughts

Once you’re married, the financial conversations don’t stop. You’ll be making financial decisions together all the time, including some that happen later in life — like retirement timing and estate planning. But if you follow these guidelines and keep open lines of communication throughout your relationship, these decisions will be easier — and you’ll also avoid any unwanted surprises down the road.