Mastering the "money talk" as a couple

When to talk about your finances

According to our recent survey, 98% of Canadians believe financial stability is key to a successful relationship. But, achieving this stability means building financial intimacy, so where and when do you start?

It’s never “too early” to talk finances with a potential partner. Fifty five percent of Canadians discuss finances before moving in together, and 35% before becoming “official” or exclusive. Having this discussion early can help you spot any financial red flags or deal breakers that could affect your long-term financial compatibility.

The "money talk" starts by being open and honest with your partner. Even if it's stressful, this is ultimately a positive conversation about your future together. Make sure you’re both prepared to approach the situation with a non-judgmental and supportive mindset.

What questions to ask

Preparing for your talk can be overwhelming. Between account balances, debt, investments, living costs, and credit reports, it can feel like a never-ending conversation. It's best to start with a few open-ended questions that can lead to a more in-depth discussion. Here are four questions we recommend starting with:

• What’s your spending personality?
  Our mindset around money is influenced by our parents, childhoods, education, and financial literacy. Understanding your spending personality and how it interacts with your partner's is important to managing your finances as a couple. If you have different spending personalities that’s okay. Regardless of financial compatibility, it’s important not to judge or shame one another’s habits. Instead, find ways you can compromise on your budget while still achieving your financial goals.
  
  Find out your spending personality and how it can impact your financial future

• What are your financial goals?
  Everyone has financial goals, but you and your partner's may differ. Whether it's paying off debt, saving for a house or retirement, or planning a vacation together, it's important to be on the same page. Talking about your goals and setting new ones together is an important part of any financial conversation.
  
  Learn how to set SMART financial goals. 

• How do you want to handle finances as a couple?
  Different couples handle money differently. Your individual spending habits, assets, and debt can influence how you handle money together. Some couples prefer a joint bank account to handle shared expenses, while others divide living expenses between their individual accounts. Some couples might split things 50/50, while others divide expenses based on income or other factors. The only “right way” to handle finances as a couple is what works best for you. Talk with your partner and figure out what method is best for your relationship, financial situations, and goals.

• Do you have any debt?
  Debt can be stressful on an individual or relationship. Even if it's difficult, it's important to review all your debt with your partner, from credit card debt to student loans and lines of credit.
  
  Personal debt can impact your ability to build a life together. High debt and difficulty paying it off can negatively impact your credit score. This could make it harder to get a mortgage and could mean a higher interest rate and payments.
  
  Getting this information out in the open means you can support each other in paying down debt and building a debt-free life together.

Keep talking about money

Financial discussions aren’t a “one and done” deal. Make financial check-ins a regular occurrence with one another and use this time to keep discussing financial goals, savings and investments, your budget and debt repayment. By regularly checking in, you and your partner will have a heads up if finances get out of hand.

Sometimes it takes an outside perspective to see how overwhelming your debt has become. If you or your partner are struggling with debt, it might be time to speak with a Licensed Insolvency Trustee. An LIT can review your finances and suggest the best debt relief options for your life and finances.

Start your journey to debt freedom by booking your free consultation today.