Of all the things to discuss before marriage, finances are the least exciting. Statistically, money is the top reason couples argue and financial arguments are among the top predictors of divorce.
- A 2013 poll by the National Foundation for Credit Counseling found 68% of engaged couples have negative attitudes aboutdiscussing money. To 45%, it’s “necessary but awkward,” and 7% say it’s “likely to lead to a fight.” Five percent predict it would call off the wedding.
- The result? Couples don’t talk finances. A Fidelity survey found that over one-third don’t know their partner’s salary, of which 72% think they communicate “very well” about finances.
- “Are you a spender or saver?” – If one saves and one spends, create a budget considering both styles. Studies show that men and women spend differently. Women tackle daily expenses (groceries, utilities, clothes); men make larger purchases (TVs, cars, computers). Amounts might be equal, but perceptions differ. About 36% of partners don’t discuss big purchases; that’s a recipe for disaster.
- “Are you in debt?” – Your spouse’s debt doesn’t become yours, but it affects your choices. Heavy credit card debt complicates home buying. Make reducing debt a priority. A TD Ameritrade survey found 38% of partners unaware of the other’s debts.
- “What are your financial goals?” “Where do you want to be in five or 20 years?” – Goal-oriented people progress toward savings and investing targets faster. Decide on the targets: buying a home, starting a family, being debt-free. List your goals, then share and plan together.
A joint bank account has pros and cons. SmartMoney found 64% of couples put all their money in joint accounts; 14% kept everything separate. Many newlyweds choose both: yours, mine, and ours. Calculate shared living expenses and then contribute your portion of those costs.
Ask For Help
If money conversations are tough, hire a professional. Your credit union can help. Act now to ensure money won’t prevent your wedded bliss.
Your Turn: Whether you’re long-married, newlyweds or planning a wedding, tell us how money matters have come into play. How did you deal with them? What worked best for you?