St. Valentines’ Day is traditionally a day for bestowing cards and gifts upon loved ones and remains a popular date for marriage proposals. But amid all the romance, a key ingredient to a happy relationship could be an open discussion on the not-so-romantic topic of money. According to a recent survey from Relate, concerns about money remain one of the top issues within relationships and families.
The earlier and more often you discuss financial matters together, the more comfortable these conversations will be. Seeking professional guidance can also help you tackle more complex financial questions or long term financial needs.
For better, for worse
Be sure to understand your partner’s financial history and know what debts he or she already has. Credit histories are important as these could be used in determining whether you qualify for any large loan, such as a mortgage.
Merging two financial lives is not always straightforward, even if you have already been living together. Discussing each other’s financial obligations and clearly identifying all income and outgoings should be your starting point.
For richer, for poorer
In addition to managing the cost of your lifestyle, discussing your aspirations and dreams for the future can provide financial goals and a realistic budget that you can both stick to. This should include things such as holidays, paying for further education for children, buying or moving home and retirement planning.
In sickness and in health
Life is uncertain and it is important to review and where necessary update your life cover, critical illness and health insurance to ensure you and your family are sufficiently covered if the need arises in the future.
To love and to cherish
If you are planning to have children, budgeting for the time off work and possible loss of incomes or additional childcare costs is important. If you already have dependent children, it will be worth discussing financial plans for them.
Till death do us part?
Nobody knows when the inevitable will happen and it is important to plan for the eventuality. This should include having an up to date Will in place as this will ensure that your estate will be handled as per your wishes after your death.
Other considerations should be will my surviving partner have enough income to live on? How long will our money last? How can I pass on my wealth to my children or grandchildren tax efficiently?
Happy ever after
Financial needs, like relationships, evolve over time and your goals and aspirations are likely to change along the way. Continual discussion and assessing your financial situation, together, is essential in ensuring that you stay on course and are able to enjoy the future you hope for.
This article previously featured in Executive Magazine
Steven Milne is a Financial Planner based at our Elgin office.