If you have entered into a committed relationship or are considering taking the next step and get married, it is important to sit down with your partner to discuss your finances. After all, one of the leading causes of divorce in Australia is financial problems.
In this article, you will be introduced to three important financial conversations you should have with your partner to ensure a bright financial future for the both of you.
It's important to discuss your finances if you're in a committed relationship.
1. Debt situation
How much debt are you both bringing into the relationship? That is a very important question for you both to answer. While you don’t automatically become liable for each other’s debt when you get married, the reality is that the combined level of debt you have may hold you back from making financial investments or from taking entrepreneurial risk.
Hence, it is important to be clear about how much debt you have and what debt repayment plan you will put into place to become debt-free as soon as possible.
2. Spending habits
It also important to discuss each other’s spending habits. Once you have identified on what you two like to spend your money on it is easy to find areas where you can cut back so that you can put money aside to pay off any outstanding debt or to put money into financial investments.
Discussing your spending habits will also help you keep each others spending in check if one or both of you have the tendency to engage in too much retail therapy or are prone to reckless spending patterns.
Do your long-term financial goals include lavish holidays or any must-have items?
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3. Long-term financial goals
Finally, you also want to discuss your long-term financial goals. Do you want to live in a big house near the beach? Do you want to have a substantial amount of spending money so that you go on lavish holidays? Are there any must-have items you want to save up for? It is important to answer all of these questions to identify what your financial goals are so that you can align them and work towards them together.
Ensuring that you are on the same page when it comes to your finances will not only help you reach your financial goals but it will also most likely bring you closer together as a couple.