Cash advice

Talking about money could be the key to a happy relationship, according to new research from ING. Seventy two per cent of couples who share finances say they have a very close relationship, compared to just 45 per cent who manage money separately. But it’

1 ECONOMIC VOWS If you’re living together, but not married, you could be opening yourself up to serious financial risks. The most important thing to sort out is who owns the house. If you’re paying towards the mortgage but your name isn’t on the deeds, you might not have any rights if you split up. Speak to a lawyer to sort out a declaration of trust, which will formulise who owns what percentage of the property, and what happens if the relationship ends. Financial benefits to tying the knot include inheritance and income tax allowances.

2 CREDIT RATING

If you’re considering joint finances, it’s important to understand your partner’s credit rating first, as they influence how much money banks will lend you and what rates you’ll get. If you already share finances, make sure that some of the bills are in your name. Otherwise, you could find that you have a poorer credit rating, which could lead to problems if you split, or if your partner dies.

3 AT A LOSS

It’s important to plan for what might happen if either of you is out of work. At the very least, you should make sure you have three months’ worth of income saved to tide you over in case of redundancy. If you’ve got children, it might be worth thinking about income protection insurance. This can make sure you’re able to cover all your bills if you find yourself out of work.

4 SAVING DEBT?

Everyone should review their finances at least once a month, but this is also something you should do as a couple. Sit down and go through everything, including mortgage payments, debts, credit cards and savings. Try to identify common saving goals – eg for a romantic holiday abroad – that you can both contribute to on a regular basis. Not only will you have something to look forward to, but it will also bring you closer together.

5 NEXT OF KIN

This is a conversation that many couples avoid, and it’s easy to see why but, at the very least, you should make sure that you both have a will. It’s important for everyone, but doubly so if you’re unmarried, as your partner won’t automatically be next of kin – and won’t necessarily inherit any property or assets. It’s also worth thinking about life insurance to make sure your family is well looked after if the worst should happen.