Fall in love. CHECK. Coordinate a morning bathroom routine. CHECK. Align your financial lives. Ruh roh!
Whether you’re recently engaged or you just walked down the aisle, you’ve got some work cut out for you coordinating your lives in your new union. Your finances may be the biggest and most important piece of that puzzle.
Not sure where to begin? Here are 7 steps you and your partner need to make as you adjust to life living under the same roof in your new financial house.
Lay It All Out. The first step to opening lines of financial communication in your house is to disclose your personal financial obligations with each other. You’ve probably seen each other naked but this is a whole new level of exposure. Not only do you need to discuss how much you earn, save, owe and spend, but you also need to talk about each of your money habits, management systems, financial goals and personal values.
Not sure how to get started and break the (money) ice? Pick up a free copy of Fiscal Foreplay: A Money Game For Couples to get the conversation started! (http://www.fiscal-foreplay.theholisticwallet.com)
Merge your money. Only you can determine whether or not you should keep separate bank accounts or consolidate and share them, but you definitely need to structure them in a way that you both have oversight over the accounts. Discuss what will work out best for you to manage your money together as you may be coming into this with different systems and habits. Having mutual oversight over each other’s accounts will maintain transparency and hold you both accountable as you work towards your shared financial goals together.
Create goals. You are both sharing the title of CFO of your household so make sure you share a voice with this. Work together to create a list of goals – anywhere from paying off a credit card to your ideal retirement – and prioritize the ones most important to you. Keep this list accessible to maintain motivation in your financial journey together.
Draft a budget. The key word here is “draft” because a perfect budget does not exist. A budget doesn’t have to be some kind of boring money diet. You are simply setting structure to your spending with your long-term goals in mind. Make sure to make space for separate spending allowances that can be spent on anything you want to avoid any bitterness if one person makes a purchase of which the other disapproves.
Systems. How will you make purchases? Will you each have your own credit cards to rack up points or will you be using cash to curb your spending? Will you split the bills and who will be responsible for which? Will you set up automatic payments or write out checks manually? Will you track receipts manually in a spreadsheet or share a web-based budget tracker? Answering questions like these will ensure you carry out your shared financial plan effortlessly.
Schedule regular money dates. It might take some time for this habit to stick, but your future selves (and wallets!) will thank you later. Scheduling time to talk about your finances, statuses of goals and new concerns will not only prevent money tension, but these check-ins are a great opportunity to revise your plan when something changes or just isn’t working. Set a recurring monthly date and mark your calendars to commit to it. Choose a time and place that’s comfortable and stress-free. And maybe – just maybe! – pick a shared reward for getting through it. (Personally, I would choose something with chocolate, but you do you!)
If you and your partner aren’t aligned about where you want to go in life (and how you’ll pay for it!), you’ll end up in different places. Start the money conversations early and come up with a solid plan to deal with budgeting, spending and financial goals to ensure you can handle anything your financial lives throw at you. And maybe – just maybe! – money management can actually be a rewarding way to bond with each other.
Need some help talking money with your honey? Check out The Holistic Wallet’s Money Merge Package and let’s set a financial foundation you two can stand up and shout from!