Traditional wedding vows include the phrase “for richer or for poorer,” yet when it comes to money matters, many couples take
a vow of silence. Whether you’re married or in a new relationship, it’s always beneficial (and never too late) to have regular and open discussions about money to prevent your finances from festering into an issue later on. Below are four ways that you can start the conversation.
Make a Money Memo
The first step toward opening the dialogue between you and your partner and knowing where each of you stands financially is to simply write down a list of all bank accounts, investments, credit cards, debts and insurance policies that you both have. An easy way to start this conversation is to bring up the practical reasons for such a list, like having it in case of an emergency.
In my career, I’ve had to help countless widows whose spouses had taken care of all the household finances and left them not knowing what bills they had to pay or how their money was invested. A list could alleviate some of the financial stress brought on by the death, disability, illness or extended absence of a partner.
Book Monthly Money Meetings
A list is great, but finances fluctuate frequently. To stay on top of what is happening, set aside some time at the end of every month where you can discuss any changes. Use your monthly bill payments as a good excuse to get the ball rolling and ease your way into having a money conversation with your partner.
Monitor Your Money
A sticking point for many couples is how each partner spends and/or saves money. Luckily, most banks and financial institutions in Canada now have tools on their websites that will automatically categorize your spending into easy-to-read pie charts.
During your monthly meeting, take a moment to compare and contrast how each of you spent and saved last month. If you think your partner is spending too much in one area, this is a good opportunity to point it out visually and set a spending goal for the next month. You can then re-evaluate any progress at your next meeting.
Merge Your Money
As you move into a long-term relationship with your partner, a joint bank account may become the next logical step to managing your money better. While combining all of your accounts will undoubtedly simplify and streamline your money situation and keep you aware of each other’s finances, there are those who will always like having their own personal accounts to maintain a degree of financial independence. But it doesn’t have to be an all-or-nothing proposition.
For example, you could still have separate chequing accounts but also have a joint savings account that you both contribute to each month. You can use this joint savings account toward things that you’ll be doing together as a couple, such as saving for a down payment on a home or a vacation.