How to Talk About Money When Moving in Together

In a relationship, few topics are as delicate as money. And having a different spending or saving personality than your partner can contribute to strife at any stage in your relationship. Getting on the same financial page with your sweetheart early on can help you avoid turbulence and tension later. Start out on the right financial footing by having a timely and honest talk about money. And what better time for a money conversation, or a series of them, than early in a relationship, before you pack a single box to move in together?
 
Mistakes to Avoid Involving Money and Your Honey
Before beginning the conversation, prime yourself with these quick tips.

• Don’t get emotional. Stay calm, listen and try to understand your partner’s views.
• Don’t bottle things up. Instead, talk them through. Nothing gets resolved through silence, and bad feelings can fester.
• Don’t rush or force delicate money talks. Make sure your partner is receptive before you tackle money topics.
• Don’t merge finances before you’re both ready. Too much “we” and not enough room for “you” and “me” could be problematic, especially if things don’t work out. Take it one step at a time.
• Don’t overreach financially as a couple. Couples can stretch their money too far, so be watchful, especially when it comes to big purchases. For instance, a bigger house means higher maintenance costs and less money for other priorities.

Discuss Finances Sooner, Not Later
Before you move in together, make sure you are on the same page. In a worst-case scenario, if red flags are raised, it’s much easier to stop a major mistake before you share an address. 

Set a time for your talk so you both can prepare—even if just mentally—and have a thoughtful, productive conversation. Here are a few key areas to discuss:

• Your numbers. If you’re going to share your bill paying, you should know a few basic things about your partner’s financial status. How much does each of you earn? This might affect how you split expenses. Do either of you have significant student loan balances or other debt? How are your credit scores? If you’re co-signing a lease, your credit status will be on the line in the event of unpaid bills. 
• Spender or saver? Generally speaking, how does each of you rate on the spectrum of saving versus spending? It’s not unusual for one person to be more of a saver and the other a heavier spender. Be aware of these tendencies before moving in together.
•  How will you share costs? Cost sharing could be a simple 50-50 split. If one of you earns significantly more than the other, one common option is to base your share of expenses on your share of the household income. To use a simple example, your partner might make $80,000 a year while you earn $40,000. If so, a two-thirds and one-third split of expenses would sound logical. You decide. There are no hard and fast rules. Talk it through and see what makes sense to both of you.
• How much will you merge? Will you open a joint account? If so, will all of your income go into the account, or just a portion? If a portion, what will that portion be? And what will the joint account be used for? Whatever your decision, remember that you can revisit it at any time.

Make It Official
If you want to take things a step further, you can both commit in writing to the key aspects. That commitment may help live up to your part. And if you split up, it can also make things much easier. You can even get it notarized. You’ll appreciate that notary seal in the event of a messy breakup.

Setting the Table for a Better Conversation
Like any conversation, the best money talks involve you both listening, remaining considerate and being empathetic to the other person’s point of view. If anyone starts to get tense, you can always take a break.

Some couples create an ongoing “money date,” where they talk through anything involving their finances as a couple. A regular conversation will allow for an easy airing of anything relevant, so it isn’t swept under the carpet. If that sounds too formal, you could casually incorporate money talks into your everyday lives. In the end, it’s a matter of finding the approach that best suits you as a couple.

Allan Kunigis is a financial freelance writer based in Shelburne, VT. He has written about personal finance for more than two decades.

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