When love won’t pay those bills

Finances can play a big part in relationships. Vicky Shaw finds out how to set good strategies in place and avoid those make-or-break money fall-outs.

So, love has blossomed and you think you’ve found the perfect partner – but are you financially compatible? Understanding each other on money issues can go a long way.

“Whether you’re married, living together or just getting to know one another, it’s crucial both parties understand each other’s finances and know how they view money management,” says Emma-Lou Montgomery, of investment firm Fidelity International.

“Being open to discussing the longterm financial plans you may have, and vice versa, can save having a lot of issues further down the line.”

Here, Emma-Lou shares eight tips for making sure your finances flourish in your relationship...

1. Don’t be afraid if one of you is a saver and the other is a spender

In a balanced relationship, having one keen saver and one more comfortable spending (within reason) can be beneficial - if it’s clear who’s responsible for what financially in the relationship. The saver can encourage a healthy attitude towards financial saving goals - be it a first home, an adventure holiday, or just cash for a rainy day.

2. Don’t leave your partner in the dark

All too often, couples leave one of the parties completely in the dark over bigger commitments, like savings or retirement plans, leading to misunderstandings and tension. The money and your financial security belong to both of you, so make sure you both have a basic understanding of the state of your finances.

3. Be honest

Many people hide debts from their partner - often out of embarrassment. But honesty really is the best policy. If you’ve come to the point when securing a joint loan or mortgage makes sense, it’s crucial any unpaid debt or blips on credit scores come to light.

4. Communicate when one of you earns more than the other

Some couples have separate bank accounts, others keep a joint account for household expenses, some agree to split bills equally, some do it in proportion to their income, while others divide up the outgoings, with one person paying the mortgage/rent and another responsible for utility bills, for example.

5. Don’t let ‘outside’ interests/ expenses become a source of conflict

It may be that you have children from a previous relationship who need your financial support, or a hobby that requires a substantial financial outlay each month. If you aren’t open about the costs with your partner, these ‘outside’ expenses can become a source of conflict.

6. Discuss the future now

For example, if you both want to travel the world later in life, factor that into your finances now to make sure that when you do travel, you can travel in style.

7. Don’t be afraid to take control

While it’s always good to plan together, make sure you also take responsibility for your own finances whether it’s by opening a new savings account or contributing more into a pension.

8. Protect yourself and your partner

Nowadays, many people choose to live together for longer before getting married or without tying the knot at all. However, this can be an issue in terms of your finances. You could consider setting up an agreement to ensure that both parties are protected and assets are divided as you would wish.