Whether you are seeing someone, are in a serious committed relationship,are married, or remarried, money is one topic that will keep coming up either in conversation or certainly in your minds.
Do you ever chat about money? At acertain
point in a relationship it is clear that things
are getting serious, and that your decisions
are starting to really affect each other; this is the time to spend some time talking about money matters and your financial goals.
Money conversations don’t have to be awkward. There is so much to talk about.
Of course, it will be very odd to ask about
money on a first date or even the second
or third, but there are important questions
to ask and signs to look out for once a relationship seems to be going somewhere.
Money matters are a fundamental part of a
relationship and having some alignment in
this area will help you build a future together.
Here are some issues to consider:
TALK ABOUT YOUR FUTURE ASPIRATIONS
This appears to be harmless, yet it is a
revealing question. Knowing your partners
aspirations and dreams for the future can
be an indication of how much they expect to earn in future or at least it gives you some indication of where they see themselves. Where they expect to live, the kind of education they plan for their children, are all fairly strong indicators of aspirations. Remember though that aspirations remain no more than dreams, if the dreamer has no clear goals and a detailed plan to achieve them. Be careful about potential; it isn’t always realized!
TALK ABOUT YOUR MONEY PERSONALITIES
Your money personality has a lot to do with
your family history. Different personality
types handle money differently. Some are
savers and some are spenders, with many
variations and combinations in between.
When two people get married, it can be a
shock and surprise to discover how your
spouse views and handles money, especially if it is quite different from the way you do. One automatically tends to assume that ‘my way is the right way’ and this can create misunderstanding and conflict. Being aware of, and talking through, your differences can calm frayed nerves. Is your partner an extravagant spendthrift? Being a miser can be just as bad, so watch out for both extremes. Do you spend all that you have? Does she save at all? There are telltale signs that show you how your partner deals with money. Does she insist on travelling only business class even when she is in debt? Does he live in an awful slum, but is paying a hefty lease payment for a car that makes him look like “a big boy,” but that he cannot
afford? Are you the type of person who makes a budget and sticks to it? Some red flags might range from being completely at odds about how much the wedding should cost, to him insisting that she must give up her career immediately and stay at home to look after his children. Are you risk averse and have carefully built your emergency fund, with financial security being a major priority for you, whilst he would risk everything to participate in a ponzi scheme like MMM or other scam that pays 30% a month! He will put all the family savings in a crypto currency
scheme. It is always a good idea to ask for help and find a good financial adviser or counselor who can look at your situation and give objective advice.
FOCUS ON THE MARRIAGE,
NOT THE WEDDING
Many couples find themselves going into
serious debt due to the expenses of their
wedding, honeymoon, and setting up a new home. Although everyone wants a fairy-tale wedding-day-to-remember, carefully weigh upyour options. You can have a lovely wedding without going broke or getting into debt. Societal expectations appear to want to keep chivalry alive. With the man being expected to pay regardless of how much he has. Should the man always settle the bill or should his date pay her way? Should she offer to pay at least sometimes? Who pays, who insists on paying, who offers to pay and who goes to
the rest room once the bill appears, says a lot about their attitude to money!
AVOID KEEPING MONEY SECRETS
Nothing breaks trust in a serious relationship or a marriage as quickly as finding out that your partner lied to you, or deliberately hid some important information from you. One of the best money and marriage tips is to avoid
keeping money secrets. Naturally, this is tough, and many couples have difficulty with this. Keeping something money-related a secret from your loved one can be a huge problem. Money secrets might include secret debt that your partner knows nothing about. It could also be about having some secret money stashed away or property that your spouse knows nothing about. When these secrets are uncovered it leads to very deep-seated hurt and resentment that breaks up many
relationships. However one must be realistic; every situation is unique. There are situations where one spouse may need to secure family assets where there is financial abuse, or where a families financial security is in utter jeopardy from vices including alcohol or drug abuse, gambling which is ruining the family’s prospects.
TALK ABOUT YOUR FINANCIAL OBLIGATIONS
This is an area that can cause much friction. Are either or both of you in debt? It is useful to know how much is owed; what is the status on personal loans, car loans, or mortgage loans. Usually, a person is responsible only for his or her own debts, so if you did not sign the contract or loan agreements for your spouse’s
debt, you usually should not be liable for that debt. In reality however, things can be very different and debt collectors have been known to arrive at the family home to cart away personal effects including the car and furniture or even seal up the house! Even if they don’t, debt directly affects quality and standards of living so cannot be ignored. What are your responsibilities towards the extended family including aging parents and
siblings? Will they move in to live with you? Is there regular child support and alimony to be paid from previous relationships if any.
TALK ABOUT YOUR FINANCIAL ROLES
Decide how you are going to share financial responsibilities, such as paying monthly bills and monitoring spending habits. Will you operate joint accounts, separate accounts or a combination of the two? Will you create abudget together or is it going to be “everymanfor himself?” Observe both your reactions when the money conversations come up. How are you going to split household costs? Fifty
fifty, or pro-rated and based on income? As a woman will it bother you if you are the primary earner? There is no right or wrong way; look at your own relationship and decides what works. If one method fails to work, simple – just change to another.
Avoid using money to manipulate, punish
or control your spouse in any way. This is
called financial abuse. It is more common
if one spouse is the breadwinner whilst the
other is unemployed or stays home to mind
the children. Women are often the victim.
Financial abuse is rarely discussed as it is
often hidden away behind the confines of what appears to be a “normal’ relationship. Women are often the victims and must account for every penny spent and must beg for money to purchase even the most basic necessities in life.
Money matters are a leading cause of friction, separation and divorce. If you are planning to get married, discuss money matters early. Try and get a full understanding of each other’s money personality and financial situation. This
will help you navigate your financial lives and help you avoid future disagreements about money. Outward appearances can be very deceptive; find out all you can before you tie the knot. There will still be surprises, but at least you can try to limit them.
Nimi Akinkugbe has extensive experience
in private wealth management. She seeks to empower people regarding their finances and offers frank, practical insights to create a greater awareness and understanding of personal finance.
For more personal finance tips, contact