Do you have an STD?
You can’t pop a condom on your bank balance, so how do you protect yourself financially in a relationship? Read on!
We’re talking sexually transmitted debt, and how it can seriously mess with your love-life. Here’s what to do
WWhether you’ve just met The One or have been living with your S.O. for 10 years, the unromantic truth is that in relationships, money really does matter. According to finder. com.au, 52 per cent of couples argue about coin, and a survey by Relationships Australia found financial stress was the number one reason for break-ups. But, hold fire on the sad face emoji. These protection strategies work, whatever stage you’re at.
THE SCENARIO YOU JUST STARTED DATING
While you’re still in the bliss phase, it’s smart to broach the awks topic of money. Just ask Relationships Australia counsellor Fiona Bennett, who says setting up an expectation that you’ll be open and honest about your dollar situation from the start can help you avoid – or communicate better about – difficult issues you may face later on. No need for interrogation tactics, though: try a less-confrontational route. “Start off by asking about [your partner’s] experience growing up; our attitudes towards money are very much formed by our parents,” says Bennett. “This can create a space for insights and understanding, without [sounding as though] you’re blaming the other person.” Plus, it’s a way less awkward date convo than how much HECS they still owe.
THE SCENARIO THEY’VE GOT CREDIT BAGGAGE
A chat with your mate reveals they’re carrying $4K in credit card debt. (Not so shocking: the average Aussie has $4268 owing on their plastic, according to a finder. com.au survey.) Why is this an issue for you? “If you got a mortgage or a loan, then it might be only in your name, or [your partner’s] parents may need to stand guarantor,” says Vanessa Stoykov, author of The Breakfast Club for 40-Somethings, a book about how financial choices can affect your life. And if you take out a loan only in your name, it means you’re responsible for paying it back if your partner goes AWOL. Swerve this by helping bae clear their rating. Get a free copy of your credit score at finder.com. au, suggests financial adviser Nicole Heales. Next, “work through each issue listed on [the] credit file. It will take time and discipline, and perhaps some professional help,” says Heales. “While you have a bad credit rating it may be possible to find lenders … to take you on as a customer, but they will charge you more.” Consumer credit reporting agency Equifax says it can take about seven years to repair your rating. Long-term graft for long-term gains.
YOU’RE LIVING TOGETHER
Living in domestic bliss but not married? It may not matter legally when it comes to your assets – or debts. Once you’ve been shacked up for two years, you’re de facto – which, according to family lawyer Frank Chila, means you fall under the Family Law Act and can have your financial disputes determined in the same way as married couples. (Two years is not a hard rule BTW, and you can reach de facto status faster if you share a child or your finances.) “We look at how your assets and liabilities need to be divided in accordance with the Act,” says Chila. That means any money or debt you both came into the relationship with will be divided between you, based on a list of circumstances such as future financial needs.
So, if you’re moving in and have assets you want to protect, it may be worth looking into a financial agreement
(like a prenup). “You’re not automatically going to keep a property, for example, if you came in with it and you separate 10 years later,” explains Chila. “So it’s always good to put a financial agreement in place that defines what happens with that property, and also with any you accumulate throughout your relationship.”
THE SCENARIO YOU’RE ABOUT TO MORTGAGE UP
Congrats! Smashed avo isn’t standing in your way and you’ve saved for your first apartment together. If reaching a 20 per cent deposit (which experts recommend) feels overwhelming, Heales advises taking your focus off the numbers. “You’re more likely to achieve a goal if it’s something you really want and you talk about that, rather than the money,” she says. “Then every decision you make [you can ask]: is it getting us closer to our goals or further away?” Taking on financial stress such as a mortgage can put a dampener on your love life, so get creative with date night. You may not be able to justify exxy dinners out when you’ve got a $100K savings goal, but beachside picnics with a supermarket cheese platter can be just as – if not more – romantic.
THE SCENARIO YOU’VE CALLED IT QUITSVILLE
Breaking up is hard to do, but it’s even tougher if you have financial disputes. “No one enters into a relationship thinking about it ending, but we’re seeing that young people now are a lot more happy to have those conversations, knowing that [separation] is just a part of life,” says Chila. And nutting out how you’re going to deal with your finances can save you both a lot of angst. “Seek legal advice, ask questions, know what’s going on in your finances and communicate. Because the best thing lawyers can do is formalise an agreement that’s already been reached,” says Chila. “The worst thing we can do is wade through an acrimonious litigation, because no one … wins.” Bennett agrees. “Whether [you’re] together or separate, it actually makes little difference, because you’re still going to need to talk,” she says. Whatever your situation – loving or leaving ’em – communication really is always the key.