With a large percentage of divorces in Australia stemming from financial issues, it's really important to be comfortable discussing financial matters with your other half.
If you are part of a couple and looking to combine your finances in the future, such as a house, you might consider also combining any debt and pay it off together to try and speed the process up.
A big mistake that many couples make is that they rush into these financial commitments without actually having their relationship in a place that they can maturely deal with such large commitments either financially, emotionally or both. It is for this reason that before leaping into any major financial decisions with someone else it is worth having a open and honest discussion about your expectations of each other and how best to manage your money.
While you may be totally in love right now and think you will just work it out as you go along, love has a pretty strong effect of making you brush over the details. What isn't a big deal now could be a huge problem if expectations aren't laid out in the beginning.
It's not going to work if one person has no issues in racking up more credit card debt in shopping sprees or blowing their money on a night out with the boys while the other is commitment to the home ownership dream.Wanting something is not the same as taking the right action to make it happen.
Many underestimate the power of a good finance conversation with their partner or are afraid to approach it.
If you are at this point in your relationship, here are some good starting points to get the conversation rolling and make sure you are on a level playing field and have a better understanding of the attitude and level of commitment each person has towards money and future financial goals.
1. Do we want to be debt free? What is acceptable debt?
2. How much do we need to save together to reach a house deposit?
3. What are we willing to give up to get there?
5. Who is going to pay for what, e.g. groceries, rent, mortgage etc?
6. What is the plan if one of us is out of work, whether it be involuntary, child related or otherwise?
7. If we have children will we both work? How can we manage financially if we don't want to return to work?
8. How will we deal with financial emergencies such as fixing the car, replacing plumbing etc?
9. Who is going to manage the money and pay the bills?
10. Will we have any accounts in our own name rather than joint?
11. What financial goals do we have? One house or two? Enough to support a family, wedding or holiday?
12. Should we consult each other before spending over a certain amount of money?
13. What kind of lifestyle do we expect to maintain?
Can we create a budget together that we are both satisfied with and committed to?
14. Can we choose to discuss money rather than fight about it and place blame?
15. What things are we going to put in place to make sure we are tracking properly, e.g. budget reviews, regular finance chats etc?
16. Are we happy to make extra repayments on loans in order to reduce it further?
17. Should we consult a financial planner to ensure we are adequately covered in the event of death, trauma or job loss?
18. If we broke up, what are the guidelines under which we think would be a fair way to divide up combined finances and assets?
19. What financial splurges are non negotiable?
20. What are we prepared to do and not do if meeting our financial commitment proves difficult, e.g. take on overtime, downgrade to one car, change jobs?
21. Will we combine our debt in order to pay it off together, with the common goal of building financial wealth together long term?
22. What is your money relationship like with your partner?