Handling Money in a Relationship
- Written by Candice Elliott
Relationships are hard enough as it is without talking about finances. So we’re gonna lay it down about how to handle money in a relationship.
You have a better chance of staying married than winning the lottery so that’s good news! But how can we increase the chances that you’ll stay married when money issues arise?
To prenup or not prenup? Oooh, sticky. If there is a chance that the man or woman of your dreams is marrying you for your vast wealth or celebrity, a prenup might be the life choice for you. But if you’re just a regular guy or gal, a prenup is probably not that important.
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A good solution to avoid money arguments is a joint checking account where each partner contributes a percentage of their income for household expenses. Each partner can also have a private account that they can spend on whatever they like.
Open, on-going communication is better than the occasional fight. This is especially important before moving in together or getting married. Imagine finding out on your honeymoon that your beloved has brought $80,000 in credit card debt to the marriage.
Money issues are an uncomfortable conversation to have and they should not begin with you asking but by you telling. By putting your cards on the table first, the other party will feel more comfortable and less ashamed about disclosing their own financial situation. Once a week or once a month, go over expenses together and see where one of you might be a bit over the top and need to cut back.
Discuss large purchases before making them. If your spouse comes home with a new outfit that’s probably not the end of the world. If one of you comes home with a new car, that’s probably going back. Or driving you to the divorce lawyer’s office.
In some situations a domestic partnership can be more beneficial than marriage. Many employers offer health benefits to domestic partners and you can avoid the “marriage tax,” because joint filers are sometimes taxed at higher rates.
Money is one of the biggest stressors in a relationship but it doesn’t have to be. Follow our advice and live happily ever after.
Mint: LMM’s preferred budgeting tool.