Merging your finances
When you merge your finances together it can be scarier than getting married. Financial stress in a relationship can often cause a breakup, so it’s really important that you deal with it, carefully and with consideration. Read our blog on how to money-proof your relationship here.
Here Marissa shares three tips that can help make this transition successful.
Tip #1 – Have open communication
Before you merge your finances, it’s important that you have open, and honest communication about things like your spending habits. Discuss if you or your partner are savers or spenders. Talk about your financial goals, including your individual goals and your joint goals. You also want to know what each other is willing to and not willing to compromise on.
It’s also important to discuss things like how you are going to manage your money in your accounts. It’s crucial that during this step, you’re:
~ getting on the same page,
~ understanding each other better, and
~committing to a partnership, rather than just one person taking control of the finances!
Tip #2 – Use a staged approach
I really encourage you to use staged approach to merge your finances. While you’re still learning about each other’s money habits, it might be good to set up a joint account for joint savings goals. For example, it might be a deposit on a house that you’re planning to buy together, or a joint holiday. But separate everyday accounts for individuals, and expenses, and individual savings are still okay.
Many couples like to keep separate savings, even as the relationship progresses, especially if there’s a spender, and a saver in the relationship and they want to save at different rates or if one person is on very different income and very different circumstances to another person. But ultimately, if your relationship is going to last the distance and you want to start a family together, at some point you might want to consider merging all your finances at that point. Hopefully by then, you’re comfortable with each other and how you manage your money and bringing that together could be quite seamless.
This transitional approach is great to help you build your confidence levels and your comfort levels. Then, by the time you get to serious financial decisions, like buying a house together, for example, you’ve already built that confidence in each other, and you’ve got your finances consolidated, there’s a high level of trust, and you’re really making sure that every dollar, that you have as a couple is working for you, and helping you to contribute to your financial future.
Tip #3 – Implement a money date night!
This could be a date night, or it could be a date breakfast, I don’t care as long as it’s a regular time that you’re catching up with your partner to talk about money. This allows you to manage your money together to make sure that you don’t get to a point of financial stress.
The most important ingredient is communication, regular and open, honest communication. So, these money dates are good opportunity to look at what’s going well, and what’s not, review your spending and where you can both save. Look at your budget, review your goals, and dreams and make sure that you’re spending is aligned with those goals and dreams, and helping you to achieve them, and it’s really important that you’re being united in your approach towards money to build a strong financial future for yourself and your family.
I hope you enjoyed these tips and good luck with your merging your finances. If you would like our help, the please reach out to us!