marriage and money:
Five ways to survive beyond the honeymoon
Alongside the romantic aspect of marriage, there’s a business side to consider when starting out as a couple. That means getting a grip on your spending, your saving and your plans for the future. In fact, how you decide to manage your money matters can have a significant impact on your chances of living happily ever after.
It’s not surprising to hear that money matters are among the most common causes of conflict in a marriage. Marriage can change your financial picture significantly in terms of how money is managed, determining individual responsibilities and how to resolve differences when each person’s intentions are miles apart.
“You have to bring a business mindset to your marriage, and as a business, you have to figure out a way to collaborate to make sure you’re not working against each other,” says Chantel Chapman, financial fitness coach at financial technology company Mogo. The best time to work out the logistics of your “business partnership”, she says, is during the early stages of a marriage, while the waters are calm and the parties are willing to negotiate terms.
The first step, Chapman says, is taking stock of your personal money situation. A self-assessment of your earnings, your debts and potential setbacks (or windfalls), provides a strong grounding. “Do a credit check on yourself and look into your report in detail to get an idea of where you stand. Identify any issues you’re having and make a plan to pay them back so you’re not bringing them into the relationship.”
Once you have assessed your situation, have an open discussion with your partner in order to get a clear picture of each other’s goals, she adds. “You need to make sure you’re on the same page, even if your goals aren’t the same about everything. The last thing a person should do is blindside their partner later on with financial goals that are out of the blue and never discussed.”
Most couples starting out will be saddled with debts of some sort, whether it’s a student loan, credit cards or a personal loan — or all of the above. Without a payback plan, debt can be extremely stressful, especially when two people are involved.
Credit cards can be the biggest culprit, Chapman says. A smart approach is to pay your revolving debt with a personal loan that comes with manageable terms. “Once you have that regular payment plan in place, use a debit or prepaid Visa rather than piling up the credit card debts again.”
In any marriage, surprises will happen — and they’re not always welcome ones. It’s all too easy for couples to get in over their heads when an unexpected expense comes their way. And if they ’re not prepared, there will be conflicts on how to handle it.
The best way to keep potential conflict at a minimum, Chapman says, is to have an emergency fund on hand and a plan in place on how to resolve issues if something does go wrong. The best time to make this plan is while everyone is in a positive frame of mind and not in panic mode, she says. “Think of it as preparation for untoward events. The worst plan is reacting after something’s already happened.”
One of the most contentious debates is around who keeps what where money is concerned. Does it make more sense to pool everything into a joint account? Or is it smarter to keep separate accounts? Decisions will be based on a number of factors such as differences in income, employment prospects, family planning and continuing education costs.
Chapman advises keeping both. “Have a joint account for a shared asset or debt such as a car, rent or household expenses. But keep in mind that if your partner decides not to put money in a joint account for a bill, you’re responsible too. So stay on top of it.”
At the same time, having a separate account for your personal needs is a good way to learn how to manage money on your own. “Being an adult means being in charge and aware of your own finances. Managing your own money keeps your adulting skills sharp.”