This is post #20 from the 30 Day Personal Finance Challenge: Boost Your Financial Health with a Daily Tip!
I know couples who believe in “What’s mine is yours” and merge their finances. All their income ends in a single account. Their debit/credit cards are connected to the same account.
I know couples who are precise and mathematical and split two ways. They track everything in Excel or use the Toshl Finance app jointly.
Other couples wouldn’t touch the financial topic with a stick. They keep their income to themselves and find it detrimental/uncomfortable/unromantic to do the money talk.
People, no matter what your situation is, it’s absolutely crucial to be on the same page!
Whatever you do, make sure it’s a team sport. I can’t stress this enough!
By couples, I mean you and your partner. A partner is your significant one, regardless of your marital situation. If you are single, consider the person you share finances with or do business with. It can be your closest circle of friends, your siblings or your business partner. Especially important is to have the money talk with your children.
You feel uncomfortable and don’t know where to start?
- How do you feel about money?
- What are your long-term financial goals?
- What is your retirement plan? (As I am writing this, it feels ridiculous, but it is a valid question.)
- What kind of lifestyle do we want to have?
- What do you want from life?
- Do we want the same things in life?
- Can we combine forces to achieve it together?
- What do you value in life? What is it ok for you to splurge on?
- What would you save on?
- How much money do you need monthly?
- How much house can we really afford?
- How do we want to manage our household budget?
- How much pocket money shall we give the kids?
- Shall we skip Valentine’s day this year? (Proceed at your own risk)
The money talks are important especially when things are getting more serious between you two. When you decide to move in together is the perfect time to open the topic. Talk before you take big decisions such as a career change, moving to a new city, having a child, quitting a job and starting a business/freelance career, taking a sabbatical leave.
How open you will be is up to you, but the more honest you are, the better.
- By sharing with your partner your beliefs and goals, they will know and understand you better.
- By talking about money, you will be more clear about what you want and where you stand.
- If you happen to have similar goals, you can combine forces saving for a new kitchen, buying a dream home, or spending a year backpacking in South America.
- You will understand your partner better and you will not judge them too harsh for their poor financial decisions.
- You can learn a thing or two from each other.
- You can keep each other accountable for sticking to goals.
- You can motivate each other in times when it all doesn’t make sense and you feel like giving up.
- By figuring out how you’ll handle the household bills when moving together you will know what to expect. You will move this subject out of the way and enjoy sooner the fun parts of living together.
How do you do your finances at home? Share your method in the comments section below.