We all know what topics are traditionally avoided on the first date, and chances are when you meet a new partner you’re going to wait some time before you get into anything too contentious. But there’s one topic that you shouldn’t shy away from, especially before you take a big step like moving in together, and that topic is money.
When you’re dating, you’ll probably develop a sense of how your partner approaches money. As your relationship gets more serious you might have a fuller sense of what they get paid, what they have saved, and what their financial goals look like. But these insights tend to be drawn from observation and assumption, and it might not be until you face your first financial test that you really discover how they really operate.
Ready to take the next step?
Chances are it won’t be until you live together that you need to think about combining some portion of your income. Moving in together carries legal responsibilities too. Once you’ve cohabited for two years, you’re likely to be legally considered to be a de facto couple—which has serious repercussions in the event that you separate.
Take the time to talk it through
With your new living situation carrying legal weight, there is all the more reason to set aside a few evenings to have the conversations you’ve either been putting off, or have never actually considered. The more of these thorny topics you can tackle calmy together, the better chance you have of weathering your first financial crisis together, whether that is a job loss, a robbery, or an unexpected large expense like a big vet bill or last minute plane tickets.
Here are the financial conversations to have before you sign a lease together, the things you’ll need to decide on, and even a great way to keep an eye on your shared accounts.
What’s your current situation?
With student loans, credit cards, hire purchase, and personal loans, chances are that one of you is bringing some kind of debt into the relationship. It’s important that you can talk about this and decide who’s going to be responsible for what. If you’re setting shared savings goals, discuss how this will impact on contributions, because it’s almost always better to pay off a debt that’s piling on the interest before prioritising savings.
What would we like to outsource?
You’re not students anymore and there’s no reason to have to divvy up the household chores with a chart. You both want to live in a comfortable space, but with busy lives, it can be hard to get to everything. Talk about what you’re comfortable outsourcing, be it gardening, takeaways once or twice a week, a delivered box of fruit and veg, or a fortnightly house clean, and then budget accordingly. Remember, this can be a small price to pay to keep the peace.
Which purchases should we discuss?
Even if you’re not ready to share your income completely, moving in together means a degree of commitment and shared decision making. It’s a good idea to set a purchase amount that will require discussion: this could be anywhere from $200 to $1000.
Even though your partner might not have ‘final sign-off’, it’s a simple way to involve your partner in your financial decisions. Decide together on a level that you think needs discussion, and stick to this.
What will we save for?
Whether it’s a house or a holiday, setting a shared savings goal is an important thing to do. Since you’re probably opening a shared account for your bills and rent, open an account for savings, and a third for an emergency fund. Using Moneytree will give you an easy, consolidated way to manage these accounts, even if you’re using different banks for each of them.
Do you want to get married?
Rather than the bride’s parents shelling out, couples are commonly shouldering some, or all, of the cost of a wedding. Add an engagement ring and a honeymoon, and marriage becomes a serious financial commitment. Once you move in together, you’ll need to decide on saving toward sooner rather than later. It’s important that you feel you can broach the subject, and it’s really helpful if you’re both on the same page with regard to what you want.
Putting a ribbon on it
So, as you can see, there’s a lot to consider when deciding on the course of your relationship. A growing relationship can be stressful, so we recommend offloading some of your money worries to Moneytree. Moneytree will help you make better decisions about your money, making sure you start off your new life on the right foot.
Want to set your relationship up for success? It’s easier with Moneytree.
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