Money conversations shouldn’t just start when you are married
Thinking about moving in with your significant other? This is a big life event that should prompt some money conversations. How you will each contribute? What expenses will be paid jointly? What expenses will be paid separately? What are his/
You hear a lot about how the most common arguments in marriages are centered around money. What tends to be covered less is the need to discuss these things while you are not married and living together, whether you plan on getting married or not. Being open about money and your values surrounding it can open doors for a healthier, more honest relationship. Now that I have you on the subject, let’s discuss the ways in which you can make moving in together a more comfortable process financially:
- You can split living expenses equally. These expenses could include rent (or mortgage payments), utilities, Wi-Fi, cable, garbage maintenance, grocery shopping, etc. The expenses you need to live. These are things you both use and can be responsible for your share. This route is the simplest and is easy to follow if you are dual income earners.
- It is likely that each of you will not earn the same amount of money. As an alternative to splitting equally you could split expenses equally proportionate to income. You can do this by examining monthly take-home pay and figure out which percentage of contribution would be fair. This is assuming that you both agreed in advance of signing a lease or buying a home that you could each afford to contribute.
- For many couples, each person is responsible for different bills. Maybe one pays the rent and the other covers utilities and groceries. This is beneficial if you are trying to boost your credit score and would each like to be responsible for paying bills on time.
- This next strategy is totally optional, but it may be beneficial for you to open a joint checking account used specifically for paying those shared expenses each month and setting aside that money agreed upon from each paycheck. If the money is set aside, it will give you less of an urge to spend that money on something other than what you were supposed to be contributing on your end.
- Create a household budget. Although you may have a budget for yourself, consider making a separate one with your partner. This can be a budget for household expenses like groceries, cable, Wi-Fi, etc. If you own a house together, you can budget for savings in a house maintenance emergency fund for those unexpected, large purchases. Say when the hot water heater breaks or there’s a leak. You may have already accounted for your living expenses in your own budget, but it will be nice to work together on something and agree on it.
- Have an agreement of what will happen if you go your separate ways. Before moving in together it is important to agree what happens to money left in a joint account or expenses that come after someone leaves. If you are going to have a shared pet, furniture, etc. make sure you acknowledge who will get what when it isn’t as emotionally painful. While moving in together is hopefully a step towards happily ever we are all aware that some things aren’t always meant to be.
Unmarried couples that live together still need a plan. If you follow any one of these tips you will be building a solid foundation for your relationship to thrive on. If you’re already married, you may need a refresh on how you can manage your finances as a couple.