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Money and Matters of the Heart

SEX! OK, now we’ve got your attention. Outside of this saucy subject, it’s the topic of money that sparks most disagreements amongst couples. Financial matters can be a real cause of friction in relationships. However, money itself often isn’t the problem. Instead, it's the way in which folks negotiate it (or not) that's the issue. Are you moving in with that special someone? Opening a joint account? Investing together? It pays to go into matters of love and money with your eyes open. If you disagree on how to handle finances, you’ll have to figure out ways to overcome this. For instance, if one partner earns less than the other, they might feel like they don't have a right to make decisions about where the money goes. First thing’s first: don't hide income or debt – bring it all to the table. And don't blame - that’s very important. The key with money and relationships is communication. You don't have to agree on everything and you don’t necessarily have to possess similar financial habits, you just need to talk about it. Here are four important issues to discuss:
  • Relationship goals:  Marriage? Buying a home? Having a baby?
  • Current financial situation:Income and expenses? Assets and debts? Credit rating?
  • Spending and saving: Approaches? Common ground?
  • Financial control: Will one person look after household expenses? Or will you share the responsibility?
Try to make conversations on cash less about flowcharts and spread-sheets, and more about goals and values. A heart-to-heart about what's important in life can pave the way to financial success. Get on the same page and plan for a shared future. Work out your short-, mid- and long-term goals together. Define them, prioritise them and work out how to achieve them. It's OK to have individual objectives, but you should have family goals, too. Work together on establishing a household budget and commit to a long-term savings approach. As much as you might hate the dreaded “b” word, everyone needs to work out what they earn and spend, so you can find out what's left over to save or splurge. Discuss major purchases before buying, but at the same time allow each person to have independence by setting aside money to be spent at their discretion. Put in place a household safety net, like three to six months of income in an alternative account. Consider life and disability insurance to protect your superannuation. In the case of an emergency, you want to avoid dipping into it before retirement. Through open communication and shared responsibility, couples young and old can come out more financially savvy and connected than ever. By having a shared approach to financial matters, you'll both feel more secure and satisfied. If you're prepared to set boundaries and compromise, even a saver and spender can live together happily ever after. Start talking, planning and saving for your future today!