Most individuals loathe talking about money. Among family, friends, and coworkers it is a subject rarely discussed. Perhaps because it is awkward to talk about, and people worry about wage inadequacies or their financial shortcomings. Or possibly, it is because of the strong emotions and meanings associated with money such as power and security.
When it comes to dating, the only instance in which money is openly discussed is deciding who is going to pay for dinner. But not talking about finances with your partner, or even your date, can spell relationship failure. It's completely understandable that when you are looking for Mr. or Ms. Right, you are looking for compatibility in multiple areas, not just how well off they are.
But money topics usually account for a great deal of stress in a relationship. Especially, as it progresses. Each partner's finances will determine what goals you can obtain as a couple. And typically these are big goals, such as buying a house, paying off a student loan, or even being able to start a family. Because finances play such a big role in such impactful life decisions, you need to start with a good foundation.
Asking to see the other person's tax returns on the first date probably isn’t socially acceptable. However, waiting to discuss finances until you are walking down the aisle is not wise either. After an acceptable period of dating, financial compatibility is an area in which you should assess your partner. But beware, this does not mean that you only date people who earn above a certain amount, or ghost someone because they make less than you.
You are trying to determine your beau’s habits, feelings, and attitude towards money. Knowing how much debt they bring to the table is also important. As previously discussed in the money series, open communication is vital. You will need to have a conversation regarding money, and likely more than one.
Whether you have been dating for three months or three years, here are the “money talks” you should be having. Talking about money progresses through three simple topics: your current financial state, your financial goals, and finally, how to balance your obligations with your goals as a couple.
Lay your cards on the table.
The first conversation can bring back feelings of middle school gym class and having to change in the locker room. Totally awkward. You will have to bare all regarding your money situation. This can be much, much, harder than actually stripping down with your significant other (and a lot less fun).
By the end of the conversation, you should have a pretty good idea of the other person's debts, habits, and income. In general, their financial standing. The ratio of how much they earn to how much they owe will factor into what goals you can set, and their timelines; should you decide to get married.
Also, if marriage is in the future, you will want to know their spending and saving habits. This is where compatibility is a factor. Just as wanting or not wanting children can be a deal-breaker, so can financially risky spending habits. Therefore, it's better to have this conversation sooner rather than later. Tips:
- Keep it casual. Try to make this conversation more of a heartfelt one on one, or akin to an elementary share and tell. Pick a neutral time, not during an argument about why you are paying for dinner for the fifth time in a row, and take it slow.
- Be open. You will have to give some to get some in return. If you are asking your partner more questions than a college application, then expect those same questions to be asked of you.
- Share more than just numbers. You will want to discuss your expectations, dreams, and feelings surrounding money. Just exchanging ATM pins won’t give you a clear picture of how they handle their finances.
To infinity and beyond!
In case it isn’t clear, this convo is all about growing old together. You and your partner will want to talk about your financial future and any goals or plans you may have. It can be exciting to talk about what your future house will look like and how many future children you plan to have, but in reality, those things cost money.
If you want to buy that home complete with a white picket fence, you likely won’t be attending every concert in town, dining out five nights a week, or jet setting off on vacations. You will want to make sure that each party is on board with the saving and sacrifices necessary to reach financial goals. You don’t have to have a multi-step plan (yet) or be one-hundred percent in sync, but you do have to be willing to make compromises and keep the conversation going. Tips:
- Talk about what you value. Many times the price tag doesn’t tell the entire story. If your significant other buys a $300 pair of shoes while you are shopping at goodwill, there may be some financial discord. Take time to talk about what is important to you and what you are not willing to give up.
- Be honest. Can’t see yourself forgoing your daily latte? Admit it. Have a credit card you are hoping to pay off in a few months? Disclose it just in case. Unless it is winning the lottery, financial surprises usually aren’t good surprises.
- Be understanding. Just because you balk at spending a paycheck on a weekend getaway, doesn’t mean you should make your partner feel inferior for doing so. Everyone has different opinions and emotions surrounding money. Unless their spending habits are egregiously terrible (like gambling) or completely out of sync with yours, show some compassion and try to understand why they handle money the way they do.
A financial union.
You have talked about where you are and where you want to be, now you have to choose how you want to get there. This involves making a budget, possibly meeting with a financial planner, and deciding if you want to combine bank accounts.
This conversation largely depends on the stage of your relationship. If you're living together and sharing expenses, at the very least a budget is a good idea. If you are only dating, you can still plan for future financial endeavors and even start saving.
The choice of whether or not to share an account is a tricky one. You can read more about that decision in another article in our relationship series.
Though this conversation will probably be less uncomfortable than the first two, budgeting as a couple takes patience and consideration. Tips:
- Assign roles. So that you don’t miss a payment or default on a loan, decide who is responsible for which bills. Some couples benefit from only one person handling the payments while other couples prefer to split the duties.
- Play fair. Just because one person earns more doesn’t mean they get more spending money. Both partners should contribute to debt, savings, and shared expenditures. How much they pay should reflect how much income they receive (and what portion of the debt is solely theirs).
Once you have made it over these three discussion hurdles, don’t let the lines of communication break down. Staying on the same page and checking in with your finances will keep your pocketbooks in good shape and keep you on track to achieve your monetary goals.
And away we go
This is the beginning of a beautifull friendship. In the meantime, are you curious to know what emotions drive your spending? Take our quiz to find out