One week from now my middle child is getting married! We have been busy planning guest lists, flowers, rehearsal dinners, bridal showers…the list goes on. The wedding industry is unrelenting. My daughter is committed to keeping things simple, yet there is no end to the websites, Pinterest posts and articles about how to plan for your special day. Yet few mention the importance of financial planning. Have you and your fiancé talked about budgeting? Is one of you a spender and the other a saver? Are you aware of each other’s debts?
Discussing financial issues may have been taboo in your family of origin but if you are getting married or deciding to cohabitate with your significant other, communicating about your expectations, values and plans is critical.
Here are some questions to consider during these important discussions:
- How do each of you make decisions? For example, do you trust your gut and follow your instincts or do you make decisions after careful thought and considering all the possibilities?
- When you need to talk about difficult things with your partner, how do you tend to behave? Do you avoid conflict, accommodate, fight to be right?
- How comfortable are each of you talking about personal finances and income?
- Would you describe yourself as someone who worries about not having enough money or believes there will always be enough?
- Do you prefer to focus on saving for the future or spending to enjoy the “here and now”?
- How much would you like to know about our partner’s financial situation, both now and in the future?
- For joint financial decisions, what similar and different attitudes or beliefs do you have about spending?
- What are some financial decisions you will need to make together in the future?
Entering into a marriage or cohabitation agreement allows you as a couple to clearly lay out how you intend to deal with your finances during your relationship and if your relationship ends, either due to separation or death. It also ensures that you are not caught by rules or laws that don’t match up with your unique needs and desires as a couple.
If you are moving in with someone, know that you are not considered “spouses” until you have lived together in a marriage-like relationship for at least two years, however, if you do stay together that long, the law counts your relationship as having started two years prior when you moved in together when it comes to legal obligations. If you don’t live together before marriage, it is the date of your wedding that signals the start of your relationship and responsibilities towards one another.
Having said this, you don’t have to sign such an agreement before the big day (i.e. the wedding day or the date of cohabitation) if you are too rushed, take the time during your first year living together to discuss these things and create an agreement that works well for both of you. Here at Connect we’d love to help you through the process.