The Premarital Money Talk

2011 February 15
by Kyle Bumpus
from → Personal Finance

No, it’s not romantic, and yes, it has to be done! Studies show that the number one thing couples argue over is money, and this source of conflict often ends in divorce: irreconcilable differences over the checkbook.

Is it possible to avoid this? Yes! But you have to talk about money before it matters, while the butterflies and roses are still alive and well. No one wants to do it. No one wants to feel like a miser and sit his partner down to ask about her money plan. Do it anyway!

Priorities

You should probably both go into separate rooms and write down, in order, your financial priorities. Then come together, and exchange lists.

If your future spouse comes back with this list:

Food
Fun
Rent
Utilities
Paying off college loans

And your list looks something like this:

Tithe
Savings
Investing
Mortgage
Basic living expenses

Then you and your future partner have to have a serious talk. But resist the urge to criticize or laugh. Your list, even if you think it superior, should not become “the list.” Your two lists need to be merged into one. There needs to be some compromise.

Who’s the Boss?

Channel your Tony Danza! Who will be in charge of the finances? This is NOT to say that the other person will be left in the dark with no say, but it is to say that usually, one person takes the lead. Usually, one person is in charge of balancing the checkbook, of making sure the bills are paid on time, so that nothing gets forgotten, and the dry-cleaning doesn’t get paid twice. Who will be the person? Which one of you has time? Which one of you is better with numbers? Which one of you is more reliable?

Debt & Credit

Debt can be a dirty word, but if your potential partner has a lot of debt, don’t you want to know about it now? Before you bring it up, ask your partner not to react emotionally. Say something to the effect of, “I’m not being critical. I just want to know where we stand so we can plan together.” Then, when you find out how much debt you will have as a couple, create a plan together. Explore your future spouse’s attitudes and beliefs about debt and paying off debt.

If you haven’t already, discuss credit. How does each of you feel about credit? Do you subscribe to the maxim If we can finance it, we can afford it or do you live by the creed If we can’t pay for it now, we can’t buy it. You need to be aware of where each of you stands on this topic, as it will definitely come into play in your future together.

Predict the Future

Ask your partner where he or she would like to be in the future. Do you want to own a home? Do you want to own a home mortgage free? Are you content to rent? When do you plan to retire? How many children do you want? Do you want to be wealthy, or just comfortable? Do you see yourself in your current career long-term?

Savings and Investment

Some people do not prioritize saving and investing. Are you marrying one of these people? Some people never spend a dime on anything fun because they want to invest it. Are you marrying one of these people? Be sure to discuss this with your future partner.

Ask him or her, “Do you plan on investing?” “How much?” “When?” “When will we start saving for our children’s college?” “When will we start saving for retirement?”

And answer these questions yourself. It may be that only one of you will invest, while the other one chooses not to, but it is better to know that now, before unspoken expectations announce themselves unfulfilled.

Where Your Beliefs Come From

While you might not feel like visiting your therapist right now, you should still discuss your upbringing with your spouse. How did your parents handle money and finances? How did they feel about money? Did they have any financial troubles that you would like to avoid? Did they do anything well that you would like to emulate? Discuss this early with your partner, so that later you don’t end up screaming, “But my father always did it this way!”

This post was written by Robin Merrill, who writes for New England Lifestyle. Check out their white chest of drawers!

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2 Responses
  1. 2011 February 15

    Yup this topic is really hard to deal with. If you’re a saver and she’s a spender, merging your accounts together is asking for conflict. I’m almost tempted to say that you should just have separate accounts. Of course with full transparency.

  2. 2011 February 15

    Yeah, I can see both sides of this issue. On the one hand, separate accounts might help limit short-term friction. On the other hands, it doesn’t really address the core of the issue of one spouse consistently over-spending. I find it hard to believe that wouldn’t eventually cause problems. Like most issues in relationships, I think the ideal solution comes down to, surprise surprise, compromise. The spender has to be willing to give up some of their former spending while the saver has to be willing to save a little less money (after a reasonable minimum is reached, of course).

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