Talk Finances with Your Partner
- Oct 12, 2018
- 4 min read
Updated: Mar 18
A guide to financial discussions with your partner to plan, navigate, and execute financial decisions together.
Disclaimer: The information provided is not intended as tax or legal advice and may not be relied on for purposes of avoiding any federal tax penalties. We encourage you to seek specific advice from your personal tax or legal counsel.
Personal finance requires dedication and effort. Relationships require dedication and effort. Personal finance in relationships... well, you see where we're going. A successful financial situation in a relationship does not just fall into place. You must be deliberate about it and dedicated to it.
We will help you navigate discussing finances with your partner. Where to begin? It starts with making time for open conversations. (We recommend bringing snacks and a beverage, too!)
The basic guidelines of financial conversations with your spouse
With more than 20 years of experience witnessing hundreds and hundreds of financial conversations between spouses, we've seen it all. And no doubt, there's a trend with the "successful" situations and those that need some help. We've learned that the most productive conversations follow these guidelines:
Choose the right vibe
Start with an encouraging, positive environment in which both parties seek to better understand each other, not simply be understood by the other.
Take your time
Recognize you're starting a journey, not trying to solve everything in one sitting
Listen
Take turns listening and sharing.
What we often learn in these conversations is that we each have very deep relationships with money and planning, typically stemming from our youth. Open, regular conversations with our partners lay the foundation for a healthy financial relationship in which both parties are involved and privy to their full financial situation.
Have financial conversations early and often
The basic recommendation here is simple: have the conversations early and regularly, and keep them positive.
When your conversations start to drift into "heated" territory, as they certainly can, take a break and come back later. But, be sure to come back! Recognize that, while these conversations can be difficult, they can also be incredibly powerful—for your finances and your relationship.
If you're planning to get married, share bank accounts, and/or share bills, we recommend you begin having these conversations as early as possible. For example, if you're getting married, have your first conversation about finances when you get engaged. From there, regularly schedule your "finance dates" every 3-4 months, or at any life-changing events like a job change or a change in your family situation.
Your action plan
Follow these simple steps to kickstart your finance dates with your partner:
Set the mood
Find a common ground to start your discussions, where you have no distractions, nothing else needing your attention, and a place where you both feel comfortable being open. Personally, we often have these discussions combined with a night out and a good microbrew to keep things light.
Start slow
Start with high-level, broad finance topics to get your feet wet, like the following:
How do you feel overall about our personal finances?
What keeps you up and worrying at night?
What financial trigger points do you have?
How often do you think about our finances?
What financial habits did you establish in your youth?
What financial habits were you raised with? What did you see your parents do around money?
Get more specific
Once you're both comfortable, dive into the specifics. Keep in mind these topics and questions are not meant to be addressed in one sitting; your financial plan is something you should develop and adapt over time.
Specific topics to address include:
Are you both up to speed on where your money and assets are, how much you have, and how to access it?
Do you have a budget? Do you need a budget? Yes, you do. It can be informal and not exact, but you need to look at it regularly.
Debt
Student, personal, mortgage. Do you have a debt payoff plan for any personal and student debt? Are you both aware of how much is remaining on your mortgage, how much your payments are, and your approximate rate? Do you have refinancing on your radar?
Insurance (life and home/auto)
Do you have the right amount of life insurance? Do you regularly check your home and auto insurance to make sure you have no gaps in coverage and are paying appropriate premiums? Do you need umbrella coverage?
When do you want to retire? Are you planning for retirement? How much do you need to retire? What does retirement look like for you?
Savings & Investments
Are you investing as you should? Is your asset allocation appropriate? Do you have the proper cash reserve?
Do you need a CPA, or are you doing your own taxes? Do you have a tax preparer you trust? Are you doing tax planning during the year, evaluating potential capital losses in taxable investment accounts, looking at charitable contributions, and evaluating tax-deductible retirement savings?
Estate Planning
Do you have an up-to-date estate plan (wills, guardianship, and trusts)? Do you need a formal estate plan? Do you need to talk to your parents about their estate plans and the impact that may have on your situation?
Do you have college savings plans for your children? Are you regularly making contributions? Are you using the right savings plans based on your state of residence, the performance, and the tax impact of using your own state's plan? Are grandparents asking to contribute to education?
Now that you've covered the basics, stay up-to-date with your plan in our app and keep at your To Do List.
