Author Topic: Pre-Marriage Money Talk  (Read 7237 times)

RidetheRain

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Pre-Marriage Money Talk
« on: August 28, 2017, 04:41:33 PM »
Hello. I'm in a bit of a quandary at the moment over how to approach talking to my fiance about money. There are a lot of discussions on here about how to talk to a spouse, but I'm not sure all of that carries over to the pre-spouse area. Right now, our fiscal lives are as separate as they can be. He recently lost his job so things are a little unusual for now until he gets back on his feet. But once he is we'll probably go back to the standard half and half deal for everything. I know he has some student debt and I have my own as well.

Can I get some advice on what is important to discuss?

Is combining finances a bad idea until we are debt free? I got that advice from a surprising number of people.

He's super open to discussing and laying cards on the table, as they say, but we don't want to get off on the wrong foot.

pbkmaine

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Re: Pre-Marriage Money Talk
« Reply #1 on: August 28, 2017, 04:57:46 PM »

MBot

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Re: Pre-Marriage Money Talk
« Reply #2 on: August 28, 2017, 07:24:36 PM »
Have you signed up for a premarital course like Prepare and Enrich? Those generally have a session on money -- but they work within a bigger format of doing assessments,  understanding each other's values, and talking first about things like family of origin and your strengtths and  weaknesses as a couple. Then talking about money.

I have a page or two from the workbook I can send you -  but I'd check it out online. They have lots of options.

Laura33

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Re: Pre-Marriage Money Talk
« Reply #3 on: August 28, 2017, 08:03:03 PM »
I'd argue the "how" is at least as important as the "what."  Ask questions - and really listen and try to understand why he does things that way.  Explain your own what and why, and listen to his responses.  Talk together about what makes sense for both of you.  Absolutely talk about logistics -- do you want to combine finances; if so, to what degree; if not what is a fair split?  But also talk bigger-picture -- what is worth taking on debt for; is debt an emergency or normal part of life; is credit card debt ever worth it and if so when; how big of a house do you want/need; how does that weigh against other wants/needs?  And then dream a little about your future -- kids?  If so, stay at home, daycare, family, nanny?  How important is FIRE vs current needs/wants? What is your vision of FIRE - work forever for less pay, volunteer for charity, sit on a beach, turn your side hustle into a full-time business, etc.?

The point of these discussions is partially to get specific answers and make some decisions, of course, but the much-more-important goal is to reveal the unspoken assumptions that each of you have -- the areas where you just assume that your way is the way everyone does it, because that's what you know.  Those are the areas that create friction, usually because you don't even know there is an issue until you are already pissed off.  E.g., the day my DH told me he had broken his sunglasses (ok) and came home with $120 Oakleys instead of the $10 drug store version that I assumed he was picking up.  Or the day we argued about the vacation plans, because he had the silly idea that budgeting in a category meant it was ok to spend whatever you budgeted (I always budgeted for less than available income, and then tried to come in *under* budget in every category).  It wasn't about the glasses or the vacation -- it was because I grew up poor and assumed that you never spent more than the absolute minimum on anything, while he grew up UMC and assumed that money always appeared when needed, so he should get/do what he wanted.  We of course knew of each other's backgrounds before we got engaged, but we had no clue how much it affected those kinds of day-to-day decisions.

FWIW, there is no objectively right or wrong answer on combining finances.  I know I've said this before, but when we married, my SIL told me that our decision to keep $200/mo each separate as "play money" meant that we were not fully committed to the marriage; meanwhile, my mom thought we were nuts for combining anything.  And yet my mom and stepdad were together 38 years with completely separate finances; my SIL is at around 23 years with their 100% share; and we are at 21 with our in-between approach.  The only "right" answer is the one that works for the two of you.*

*Our $200/mo. "allowance," for ex, was a direct response to the sunglasses incident, so he could buy stupid shit and I couldn't nag him, and I could save mine and so come in under budget.  My SIL's approach (mutual agreement on every purchase) would have destroyed our marriage within 5 years - I'd nag and he would shut down, and we would have quickly become sources of conflict for each other instead of sources of strength and support.  As with everything else, YMMV.

Finances_With_Purpose

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Re: Pre-Marriage Money Talk
« Reply #4 on: August 28, 2017, 10:42:55 PM »
Once again, Laura33 chimes in with excellent wisdom.  I'll agree and also add a vote in favor of premarital counseling - for a whole host of things, not least of which is finances. 

Beyond that, have lots of discussions.  If you're that close, take a look at actual numbers/a budget from each of you.  It's one thing to talk about it ("I don't spend too much on that.") and it's another to learn that he/she is really attached to a $1,500/month shopping budget.  Seriously. 

After helping couples a long time, it helps to get specific in some ways.  Everyone always thinks he/she is not a big spender, everyone always thinks he/she is normal, and everyone always thinks he/she can adjust easily...and yet, the USA holds about $13 TRILLION in household debt.

You'll meet folks who say they're killing it...but have 70% of income devoted to debt payments and 30% is being spent.  And then you'll meet other folks who think they're not saving enough, but have $600k in the bank and are saving 50% of their income.  Specifics can help.

Look at it like a learning curve: you're having lots of conversations to learn about this person, and you're going to continue learning about this person.  That'll help you figure out how to make things work well with the two of you.  The more you can learn now (esp about assumptions, as Laura said), the better off you'll be. 

2Cent

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Re: Pre-Marriage Money Talk
« Reply #5 on: August 29, 2017, 02:00:49 AM »
I'd argue the "how" is at least as important as the "what."  Ask questions - and really listen and try to understand why he does things that way.  Explain your own what and why, and listen to his responses.  Talk together about what makes sense for both of you.  Absolutely talk about logistics -- do you want to combine finances; if so, to what degree; if not what is a fair split?  But also talk bigger-picture -- what is worth taking on debt for; is debt an emergency or normal part of life; is credit card debt ever worth it and if so when; how big of a house do you want/need; how does that weigh against other wants/needs?  And then dream a little about your future -- kids?  If so, stay at home, daycare, family, nanny?  How important is FIRE vs current needs/wants? What is your vision of FIRE - work forever for less pay, volunteer for charity, sit on a beach, turn your side hustle into a full-time business, etc.?

The point of these discussions is partially to get specific answers and make some decisions, of course, but the much-more-important goal is to reveal the unspoken assumptions that each of you have -- the areas where you just assume that your way is the way everyone does it, because that's what you know.  Those are the areas that create friction, usually because you don't even know there is an issue until you are already pissed off.  E.g., the day my DH told me he had broken his sunglasses (ok) and came home with $120 Oakleys instead of the $10 drug store version that I assumed he was picking up.  Or the day we argued about the vacation plans, because he had the silly idea that budgeting in a category meant it was ok to spend whatever you budgeted (I always budgeted for less than available income, and then tried to come in *under* budget in every category).  It wasn't about the glasses or the vacation -- it was because I grew up poor and assumed that you never spent more than the absolute minimum on anything, while he grew up UMC and assumed that money always appeared when needed, so he should get/do what he wanted.  We of course knew of each other's backgrounds before we got engaged, but we had no clue how much it affected those kinds of day-to-day decisions.

FWIW, there is no objectively right or wrong answer on combining finances.  I know I've said this before, but when we married, my SIL told me that our decision to keep $200/mo each separate as "play money" meant that we were not fully committed to the marriage; meanwhile, my mom thought we were nuts for combining anything.  And yet my mom and stepdad were together 38 years with completely separate finances; my SIL is at around 23 years with their 100% share; and we are at 21 with our in-between approach.  The only "right" answer is the one that works for the two of you.*

*Our $200/mo. "allowance," for ex, was a direct response to the sunglasses incident, so he could buy stupid shit and I couldn't nag him, and I could save mine and so come in under budget.  My SIL's approach (mutual agreement on every purchase) would have destroyed our marriage within 5 years - I'd nag and he would shut down, and we would have quickly become sources of conflict for each other instead of sources of strength and support.  As with everything else, YMMV.
Good ideas. But it is important to stay flexible to change when circumstances change. A separate deal is great when both are earning the same. But in case of job loss, or when finances are more tight it may be good to switch to agree on every larger purchase.

MsSindy

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Re: Pre-Marriage Money Talk
« Reply #6 on: August 29, 2017, 09:04:11 AM »
I think conversations that are fairly broad are important to have and will naturally flow into the more detailed, tactical answers you're looking for.  For example, how do you both feel about your debt and potential earnings?  If he loses his job, do you say, "too bad for you", or do you look at your finances as, "we're in this together" and we'll pay them off together, we'll save together, we'll spend together, etc.  What if one makes A LOT more money than the other?  Do you guys have the same goals about FIRE, kids, SAHP or not?   These broader questions will inform HOW you will manage things.  But remember, once you are married, legally your debts and assets are each other's, so you should always be operating in the mindset of what is best for you as a couple.

DH and I didn't have any debts or assets to bring into the marriage, so we didn't even think twice about combining finances, because we are "in this together".  We do the $XX per year 'free spending', so that we have some freedom in our purchases with no nagging or eyerolls from the other - it works really well.  Our only rule is that the purchase (even if within budget) can't impact the other person - meaning they can't get a dog even though their 'free spending' would cover the cost.


RidetheRain

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Re: Pre-Marriage Money Talk
« Reply #7 on: August 29, 2017, 09:47:24 AM »
Thanks for the input everyone!

I think I'm going to look up some different counselling services than the required church-sponsored one we are going to now. There are some gender-based assumptions that really just don't work for me and my soon to be DH.

I'm compiling all your suggested questions and we're going to go through them one at a time. We originally got a little book full of questions for couples so that we could get on the same page. It worked for living arrangements and children and vacation time and work-life balance. It was strangely silent on the subject of money.

It's a good point that even if we have separate finances, legally we are still equally responsible for debts.

rdaneel0

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Re: Pre-Marriage Money Talk
« Reply #8 on: August 29, 2017, 07:55:26 PM »
I don't think you need pre-marital counseling. In fact, I think it's better if you set up a system for discussing finances on your own rather than with a mediator, because that's what it will be like for most of your marriage.

DH and I had separate finances until we were engaged (I think it's a bad idea to combine before that happens), at which point we combined finances, but we had many talks about money before that, and were very much on the same page.

I recommend setting up a once-a-month money talk. So, step-one would be saying, "hey, we're going to have to deal with money stuff, how do you feel about setting up a monthly money talk?"

During our talks about money (which typically last about 15-30 minutes), we are in business mode. Yes, we are husband and wife and madly in love, but during our money talks we're business partners. There is no emotion involved, just goal-oriented planning.

Things to talk about during your very first money meeting, which will probably be longer than subsequent conversations:

1. What is your current situation? In this conversation you need to lay it all on the table. What debt do you both have? What savings or assets do you have? How much do you save/spend relative to your incomes?

2. What lifestyle do you both want? How much spending is ok with you, what are both of your savings goals? How do you both feel about credit card debt or other debt? At what age do you both want to retire? Where do you want to live? How much traveling do you want to do?

3. How much work needs to happen to get on the same page? Do you both already have detailed itemized budgets?

4. Set a budget together, as well as a savings budget.

After all this, it's just check-ins.

wordnerd

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Re: Pre-Marriage Money Talk
« Reply #9 on: August 29, 2017, 07:57:29 PM »
Highly recommend the book 10 Conversations to Have before You Get Married. One of the ten conversations is about finances, and the other nine will likely be helpful to you as well. DH and I went through the book before we got engaged and found it really helpful.

historienne

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Re: Pre-Marriage Money Talk
« Reply #10 on: August 30, 2017, 07:23:15 AM »
I don't think you need pre-marital counseling. In fact, I think it's better if you set up a system for discussing finances on your own rather than with a mediator, because that's what it will be like for most of your marriage.



In my experience, premarital counseling (and post-marital counseling, for that matter) isn't really about having a mediator to help you handle these conversations.  It's more about teaching you how to handle them yourselves - working on the skills that you need to work through conflict in your relationship.  So you may not need pre-marital counseling, but I do think it can be useful for the longterm.  My husband and I definitely find that to be true - we still use some of the techniques that we learned in those sessions.

Rufus.T.Firefly

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Re: Pre-Marriage Money Talk
« Reply #11 on: August 30, 2017, 07:39:37 AM »
My spouse brought debt (around 50K) and I brought zero. Nevertheless, we combined finances immediately and knocked that sucker out! No bitterness, no resentment. You can't change the past, you can only change the future.

Don't be fooled. Marriage by definition is combination.

The monthly financial review is by far the most powerful tool for a couple. All the answers to the discussion questions that people have raised will change over the years. Don't think of this as a one-time conversation, but rather an ongoing, permanent conversation about finances. Set yourselves up for success by committing to regular communication.

hops

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Re: Pre-Marriage Money Talk
« Reply #12 on: August 30, 2017, 08:08:16 AM »
I don't think you need pre-marital counseling. In fact, I think it's better if you set up a system for discussing finances on your own rather than with a mediator, because that's what it will be like for most of your marriage.

In my experience, premarital counseling (and post-marital counseling, for that matter) isn't really about having a mediator to help you handle these conversations.  It's more about teaching you how to handle them yourselves - working on the skills that you need to work through conflict in your relationship.

My fiancee and I recently completed Prepare/Enrich as part of premarital counseling, and that mirrors our experience: the focus was on us discussing things on our own. Our friends and coworkers who were unfamiliar with the process also had visions of us having to hash out all the details of our arguments and sex life and whatnot with a counselor, which wasn't the case. It was non-invasive and our big emotional discussions were held at home between the two of us. In our case, we weren't given any topics to discuss that we hadn't already discussed throughout our relationship, but it was useful to sharpen our communication skills.

Besides the topics Laura mentioned, one of the most important financial conversations you should have with your partner is in what situations you're willing to financially help your families, and to what extent you're willing to help them. In our case, we check in with each other somewhat frequently about that because opinions can shift as your circumstances, or those of your needy relatives, change.

Thanks for the input everyone!

I think I'm going to look up some different counselling services than the required church-sponsored one we are going to now. There are some gender-based assumptions that really just don't work for me and my soon to be DH.

Edited to add: Our counseling was church-sponsored (by a very liberal church) and the way some of the questions were phrased in the questionnaire and workbook didn't apply to us because we're both women. It was easy to ignore -- although we laughed at one about whether we believe in traditional gender roles -- because the questions are universal. Seeking other services if one is too narrow in its approach is a really good idea!
« Last Edit: August 30, 2017, 08:23:32 AM by hops »

rubybeth

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Re: Pre-Marriage Money Talk
« Reply #13 on: August 30, 2017, 08:58:09 AM »
I will also second (third, fourth) the concept of premarital preparations of some kind--church-sponsored, with a counselor or therapist, etc. These sessions aren't really about specifics, but more about discussing expectations. My number one recommendation for engaged people is premarital counseling of some kind. I think there are even online/Skype options for folks these days. Ours was really an opportunity to see differences and then discuss them privately. Prepare/Enrich is backed up with clinical research.

Before we got married, DH and I did sit down and work out a budget. Of course, over the years, things have changed dramatically. We no longer have debt, incomes have increased, we've had periods of unemployment or under-employment, and we work it out. We have very few arguments about money, which is a huge source of stress/strain/arguments for lots of couples. We have been together about 12 years, married for 9. We initially had separate accounts but started sharing everything after about a year or so of marriage--you can always adjust if you're willing to be open and discuss things. Starting this before marriage is good practice. :)

rdaneel0

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Re: Pre-Marriage Money Talk
« Reply #14 on: August 30, 2017, 09:05:56 AM »
I didn't realize pre-marital counseling was so common! If it works for you, of course go for it. I wonder if this is more common now than in the past? I never heard anyone talk about it except really religious catholic couples, so I may just be out of date.

MBot

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Re: Pre-Marriage Money Talk
« Reply #15 on: August 30, 2017, 09:47:06 AM »
I didn't realize pre-marital counseling was so common! If it works for you, of course go for it. I wonder if this is more common now than in the past? I never heard anyone talk about it except really religious catholic couples, so I may just be out of date.

Around here we generally call it "marriage preparation" or "marriage prep" because "counseling" is a more specific thing.

 I specifically recommend Prepare/Enrich because

(A) it's really easy to find a provider - around for years and through all sorts of types of providers

(B) they don't push traditional gender roles (though as another poster mentioned it will still be husband/wife terminology)

(C) from a provider standpoint there are actually totally separate questionnaires for religious people and those who do not consider themselves religious  -- so you still get asked about priorities in that area, but not in a way that conflicts with where you are at or pushes you to something you don't want.

(D) each of you get separate, identical online questionnaires that identify your strengths and growth areas as a couple, but also things like how optimistic and pessimistic you are, how you problem solve, family of origin questions.  I LOVE how you are able to see that data and how it informs the conversation and report.

RidetheRain

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Re: Pre-Marriage Money Talk
« Reply #16 on: August 30, 2017, 10:03:51 AM »
I didn't realize pre-marital counseling was so common! If it works for you, of course go for it. I wonder if this is more common now than in the past? I never heard anyone talk about it except really religious catholic couples, so I may just be out of date.

TBH I didn't know it was either! I definitely fall into the "really religious catholic couple" area so it didn't occur to me that it happened elsewhere. Counselling with the priest is generally mandatory or else we never would have considered it.

Capsu78

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Re: Pre-Marriage Money Talk
« Reply #17 on: August 30, 2017, 11:54:22 AM »
No help for the OP here but I once attended a mandatory session of "Evenings for the Engaged" as a Solo as my wife was finance had an abrupt business trip come up. 
Married 33 years on Friday, so I guess her lack of attendance didn't matter!
Much like MsSindy, our "financial empire" was pretty small on our wedding day, so we combined finances at once and always viewed our financial scoreboard as "One Team".  I earned more than she did, then she earned more than I did, then that switched again and finally she ran away in income disparity.  We don't have many financial "rules", but I probably wouldn't spend more than $200 without a quick huddleup. She has talked me out of some purchases, as have I with her... but if something is important to either of us we usually "get to yes" one way or another.
The only odd quirk is that she details our investment accounts on a different spreadsheet than I do resulting in redundancy, but oddly offing a check and balance if we come up with different numbers.

sobezen

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Re: Pre-Marriage Money Talk
« Reply #18 on: August 30, 2017, 01:16:26 PM »
How would you describe your existing finance related experiences with your partner?  And in the past what have you both articulated about your money values?  Determining the answers to these two initial questions will give you additional insights on how you both treat finances. 

Additionally, make time to fully discuss all of your life goals too; share your hopes, dreams and fears.  Do you want a career, advance degree, start a family (when, how many), be a SAHM, buy a home, buy investment property, early retirement?   Ultimately you both need to start thinking about what type of life you want to create individually and together.  So on that note, perhaps starting with the end in mind, might help you visualize clearer.

A good book that helped give me more ideas is "Your Money Or Your Life".  Consider reading it together and doing the homework will create built-in conversation starters.

Also not sure where exactly the OP is financially, but consider also reading this thread as well. https://forum.mrmoneymustache.com/personals/would-you-combineshare-your-money-with-a-new-partner/msg1677022/#msg1677022
« Last Edit: August 30, 2017, 01:22:36 PM by sobezen »

boarder42

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Re: Pre-Marriage Money Talk
« Reply #19 on: August 30, 2017, 01:43:44 PM »
remember whatever you do decide now will always change my wife and i's financial setup has changed slowly over time.  and will eventually change dramatically when we FIRE.  we keep separate finances for the most part and we do shared expenses on credit cards marked for certain costs.  and she writes me a check each month for the shared expenses as i pay off the cards and our mortgage.  our shared costs have evolved and much more goes on joint cards than what we originally did.  it started out with a joint gas card before we were married but we were living together b/c i was tired of the its your turn to drive no its yours.  - solution get a joint gas card and take the more fuel efficient car always.  Same thing happened later with groceries.  it was an i've bought more not i bought last time etc. thing and solution create a joint grocery card.  but outside of those and items we agree are joint purchases and our savings we spend our other money our own way. 

RidetheRain

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Re: Pre-Marriage Money Talk
« Reply #20 on: August 30, 2017, 02:23:36 PM »
remember whatever you do decide now will always change my wife and i's financial setup has changed slowly over time.  and will eventually change dramatically when we FIRE.  we keep separate finances for the most part and we do shared expenses on credit cards marked for certain costs.  and she writes me a check each month for the shared expenses as i pay off the cards and our mortgage.  our shared costs have evolved and much more goes on joint cards than what we originally did.  it started out with a joint gas card before we were married but we were living together b/c i was tired of the its your turn to drive no its yours.  - solution get a joint gas card and take the more fuel efficient car always.  Same thing happened later with groceries.  it was an i've bought more not i bought last time etc. thing and solution create a joint grocery card.  but outside of those and items we agree are joint purchases and our savings we spend our other money our own way.

That seems like a really good idea. I never considered a joint credit card for shared expenses. We are pretty lopsided so far as income goes and a joint card might be what we need to mentally start the process of putting our money together where it matters.

Imustacheyouaquestion

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Re: Pre-Marriage Money Talk
« Reply #21 on: August 30, 2017, 02:36:46 PM »
I'd discuss goals, lifestyle expectations, and the stuff you hear (from movies, friends, family, etc) that married couples argue about.

- How much do you think is reasonable to spend on XYZ per year?
- If one of us got a job opportunity, but it required relocating to a faraway place, how would we handle the decision?
- How many times per year would we visit family? What kind of presents would be buy for family members and ourselves?
- If we have children, would we pay them an allowance? Require them to do chores or get a job? Support them financially in college or not?
- When do we plan to retire?
- Do we expect some kind of lifestyle inflation over time, or will we continue living at our current standard of living (housing, cars, food, entertainment, etc)?
- If a family member is sick or didn't save enough for retirement, do we plan to support them or take them in?
- How would we manage if one or both of us lost our jobs or became permanently disabled?

Etc. The nitty-gritty of actual details like "who shares what bank account" are probably a lot less important than agreeing on your values and how that dictates you would spend money if you were married.

galliver

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Re: Pre-Marriage Money Talk
« Reply #22 on: August 30, 2017, 03:29:28 PM »
Separate finances don't have to be secret finances. You can always run decisions by your partner like "I'm contemplating buying this thing, do you think that's silly or good?" My bf and I (together 6yrs/cohabiting for 3) split things 50/50 but we do so with partially combined finances. Since we've moved in we spend a lot of our money together: rent, utilities, car gas/insurance (we share his car), groceries, outings/travel. We also jointly purchase(d) apartment stuff but I could see how someone might want a stricter idea of ownership so I don't necessarily recommend it; just works(/ed) for us. These come out of a joint bank account that only ever holds one month's expenses, or on the AmEx where I added him as a user (the one with 6% rewards on groceries); I can set a limit on his spending or cancel his privileges at any time, unlike a joint card, so I don't feel uncomfortable with it.

For the rest of our finances, we'll often ask each other's advice/input, share goals/milestones, cheer each other on. He'd share his progress on his student loans, and the car; I share how much I managed to save each month from my stipend (I'm piling up cash for when I finish my PhD in a couple months). So, we don't have direct access, but we know where the other is. And we'll run big purchases by each other, even though we aren't obligated to, because we trust each other's opinion. No one has "veto power" but we always have some influence: where will we put it? how often will we actually use it? what will we do with the other thing that performs the same task?  Or sometimes it's like YES, please buy the sweater!!! (He spends much more easily on electronics than clothes, haha.)

In the process of sharing and talking about all these things, more fundamental issues came out. I told him about MMM when I first discovered it but he wasn't very interested; but as he's paid off his student loans and saved up more, he's gotten interested in investing and consulted some of the forums about that. I think it's also hit home how our everyday choices impact his ability to save/pay off/invest; he's more likely than before to offer to cook now instead of suggesting takeout, and I think we're both buying less stuff for ourselves than we used to. We've also talked about how we actually have a really nice lifestyle, don't feel deprived and sometimes feel rather extravagant, even though it fits in a grad student budget (well, half of it does, with some room to save), so we'd be comfortable sustaining this to accomplish significant financial goals. We like to joke about mainstream financial silliness together (I was recently joshing him that we've had the car 3 years now so time to get a new one! and he was joining me in being appalled that people thought this way.) I guess the crux of what I'm trying to say is you don't have to get this information through a Serious Conversation About Money or a questionnaire or something (not that you shouldn't bring up some of the questions others have mentioned, as they're very good things to discuss). Money is so much a part of everything we do and all the choices we make that just mentioning and discussing those choices can bring up a lot of thoughts on the subject very organically.

Oh, and that between "shared" and "separate" finances there's a lot of spectrum in how you actually do it. You can do a gradual transition if you don't want to go straight from "no idea" to "one bucket".

sobezen

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Re: Pre-Marriage Money Talk
« Reply #23 on: August 30, 2017, 03:59:34 PM »
Completely agree with galliver.  Separate finances does not equate secret finances or a lack of shared life goals.  Separate finances also does not mean you do not trust your partner too.  You can always share your thought process with your partner and make major decisions together as needed.  I just want to stress when it comes to finances it does not require an all or nothing approach as commonly portrayed by the media.

jo552006

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Re: Pre-Marriage Money Talk
« Reply #24 on: September 01, 2017, 12:07:00 AM »
This stood out to me (sorry for home-made quote, first post not showing when replying)

"He's super open to discussing and laying cards on the table, as they say, but we don't want to get off on the wrong foot. "

What does this mean?  It's an odd way to phrase this.  Why would discussing finances ever end up in getting off on the wrong foot?  Is there an underlying worry/problem, or just a phrasing choice?

With regards to separate/combined finances, anything works if it works for YOU.  Literally forget what other people tell you, and if you end up with a situation people normally think poorly on (combining before debt free for instance,) don't share it.  As a side note, whether you're soliciting, or they're offering financial advice, it can cause issues.  It's only for the two of you to decide as you're adults.  Been there, done that, almost broke up.

I will say this, if you WANT to combine finances but are worried about debt, perhaps think about keeping finances literally separate, but virtually shared.  Example: you save 2k a month, he saves $500/month.  Put the money in separate accounts like normal (so if something happened separability would be easy) then cut checks and put 2.5k/month on his student loan debts.  This way, you're protecting yourself, but still having the affects of joint finances.

Personally we just combined everything as we knew we wanted to once married, and we planned to stay married, hence any interest paid for either of our loans affects us both equally long term.

T-Rex

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Re: Pre-Marriage Money Talk
« Reply #25 on: September 01, 2017, 01:00:45 AM »
Have you signed up for a premarital course like Prepare and Enrich? Those generally have a session on money -- but they work within a bigger format of doing assessments,  understanding each other's values, and talking first about things like family of origin and your strengtths and  weaknesses as a couple. Then talking about money.

I have a page or two from the workbook I can send you -  but I'd check it out online. They have lots of options.


Hi, what is the origin of Prepare and Enrich? Is it a secular program? And how was it?

shelivesthedream

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Re: Pre-Marriage Money Talk
« Reply #26 on: September 01, 2017, 02:23:37 AM »
I reckon a good way to have the talk alone is to compile a load of questions (such as those in this thread!), prepare a little quiz sheet and then fill them out separately and swap answers. It means one person won't take over the discussion and you both get to see each other's honest answers without being influenced by the other. The questions could be:
- financial priorities
- if X happened, what should we do?
- how much should we budget for Y?
- how should we shop for Z?

rubybeth

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Re: Pre-Marriage Money Talk
« Reply #27 on: September 01, 2017, 07:16:29 AM »
Have you signed up for a premarital course like Prepare and Enrich? Those generally have a session on money -- but they work within a bigger format of doing assessments,  understanding each other's values, and talking first about things like family of origin and your strengtths and  weaknesses as a couple. Then talking about money.

I have a page or two from the workbook I can send you -  but I'd check it out online. They have lots of options.


Hi, what is the origin of Prepare and Enrich? Is it a secular program? And how was it?

https://en.wikipedia.org/wiki/ENRICH
http://www.cehd.umn.edu/fsos/people/faculty/OlsonD.asp
https://www.prepare-enrich.com/pe/pdf/research/research_links.pdf

RidetheRain

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Re: Pre-Marriage Money Talk
« Reply #28 on: September 01, 2017, 09:42:15 AM »
"He's super open to discussing and laying cards on the table, as they say, but we don't want to get off on the wrong foot. "

What does this mean?  It's an odd way to phrase this.  Why would discussing finances ever end up in getting off on the wrong foot?  Is there an underlying worry/problem, or just a phrasing choice?

Sorry for the confusing word choice! What I mean is that we wanted a baseline of ideas for how to handle our finances as a couple. Since we have zero experience in this area we didn't want to decide something that is universally known as stupid and not helpful. Or worse, completely missing an important part that we should discuss - for example, a lot of people on here suggested talking about what dollar amount would require a joint agreement for spending or something similar. Never in a million years would have occurred to me, but it's a valid discussion point.

He asked me to come up with some questions to talk about and he'd bring some of his own. I figured I'd leverage the wealth of information and experience that lives here!

RidetheRain

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Re: Pre-Marriage Money Talk
« Reply #29 on: September 01, 2017, 09:56:35 AM »
Slightly off topic: We were discussing his student loans the other day and talked about possibly getting them refinanced. He works as a contractor and so has variable pay. Banks hate him. After we tie the knot, is he likely to get better rates because of my steady income stream or will that not appear at all during the process?

little_brown_dog

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Re: Pre-Marriage Money Talk
« Reply #30 on: September 01, 2017, 11:22:16 AM »
Honestly, it all depends on you two as a couple your personalities, your reliability, your trustworthiness, whether or not you really genuinely see each other being together forever (and not just hoping it), etc. Not all couples and relationships are made equal. Combining finances pre marriage and with debt can absolutely work well for some couples it did for us. But we also had, and still have, a particularly strong and mature relationship. Neither of us are the types to blow money, cheat, lie, hide spending, or generally act in risky ways that hurt ourselves or our partners, so the risks of just going all in and trusting each-other fully were low. Both of us were pretty frugal as it was, non materialistic, and even though we were young and far more money nave than we are now, we were generally on the same page about the big stuff like avoiding or eliminating debt, saving substantial amounts, and avoiding lifestyle inflation or stupid purchases.  It paid off by working together we eliminated over 100k in student loans and over 20k in car loans in 5 years while also paying for a wedding, buying a house, and having a baby. I dont think that kind of pace would have been possible if we had staunchly insisted the other person remain solely responsible for their finances/debts/etc. However, if we had different spending and saving habits, or if we had a rockier relationship, combining finances would have been far riskier.

Michael in ABQ

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Re: Pre-Marriage Money Talk
« Reply #31 on: September 01, 2017, 12:57:26 PM »
Whenever I hear married people talk about their separate finances it always just seems weird to me. I've been the sole income for nearly our entire marriage (coming up on 10 years), and most of the year we were living together before we got married. My wife had a job during my last year of college that contributed some money but it was never a question for us that we would be fully combining all finances along with the rest of our lives. It's helped that neither of us have ever been big spenders and we knew from very early one that we would be together the rest of our lives and would be building a family together.

We didn't really get our financial act together until a few years ago. Prior to that I handled everything and was mostly able to make things work. But over time we continued to live beyond our means and slipped deeper into debt. The credit cards I ran every purchase through didn't always get paid off in full each month and after a while we were carrying balances of thousands of dollars and I was using 0% balance transfers to string things along.

When we finally sat down and got serious about our money, I created a big spreadsheet to track where every dollar was going and how much all of our debts were. When we actually created a monthly budget and talked about how much to spend on groceries and clothing and all of the other things it really did help our marriage. If you can talk through the money stuff it's connected to so many other important things like your goals and values.

nawhite

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Re: Pre-Marriage Money Talk
« Reply #32 on: September 01, 2017, 02:14:11 PM »
Slightly off topic: We were discussing his student loans the other day and talked about possibly getting them refinanced. He works as a contractor and so has variable pay. Banks hate him. After we tie the knot, is he likely to get better rates because of my steady income stream or will that not appear at all during the process?

It will only help if you are going to become a co-signer with him. I'd strongly recommend against that simply because 1) even that amount of student loans is really small for mustachians to make go away in a year or two and 2) if the worst happens and he dies or you get divorced in the next year or two, you're on the hook for those loans. In many states, debt from before the marriage isn't communal but if you re-finance as a co-signer, all of a sudden it's your responsibility.

If you're looking to improve his chances with banks without becoming a co-signer, wait a year and offer show a W-2 or tax return instead of a paystub. Then the bank is less likely to know his income is variable.


For the original question about how to discuss these things, it's easy for either party to forget (unintentionally or otherwise) about accounts or purchases. Going along with "Separate finances don't mean secret finances" comments, have both of you get all of your accounts in Mint or Personal Capital and once a month at the start, both of you should verify every line item in mint and on your paystubs. It's easy to forget signing up for an HSA account or a 401k account or even "that one student loan that is with a different processor", so get them all in mint.

I'd also recommend you both get your credit reports and go over every account listed for each other. What is it, what needs to be done with it, is it still active?

galliver

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Re: Pre-Marriage Money Talk
« Reply #33 on: September 02, 2017, 01:29:04 AM »


Neither of us are the types to blow money, cheat, lie, hide spending, or generally act in risky ways that hurt ourselves or our partners [...]

With ALL due respect...you can only really say this about yourself. You hope it's true for your partner, you think it's true, in fact you're pretty darn sure...But so is everybody. And then a guy leaves his wife in the hospital with their newborn *third* child, drains the bank account, and vanishes, leaving older two with whoever was watching them during the birth. (Actual heartbreaking GoFundMe I once read, friend of an acquaintance. SAHM, left with literally nothing. In fairness I don't know what happened. Maybe he cooled off and came back. Maybe she built a legal case against him. No idea.) I doubt many people look at their partner and prospective spouse and think "yup, this one is a cheater/thief/abuser!" And yet, unfortunately,  people get cheated on, stolen from, and abused all the time. Even if nothing goes so horribly wrong, people are frequently surprised by breakups.

So the way I figure, everyone has a right to act sensibly, and that's not mistrust, that's avoiding thoroughly unnecessary risk. The other partner should celebrate being with someone who takes care of themselves! You can always help out, offering to pay a greater share of expenses, contribute directly toward their debts, or support them through unemployment...But this can all be executed as a gift between individuals, and does not require pooling all money.

This is not a content on anyone's partners, obviously...I don't know you or them! It's a comment on how deeply we are *all* flawed at evaluating ourselves and the people we love, and therefore that we should likely largely disregard our own assessments of our relationships when making financial decisions...

jo552006

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Re: Pre-Marriage Money Talk
« Reply #34 on: September 02, 2017, 08:19:40 AM »
I'll pile on with the recommendations not to refinance student loan debt, unless it REALLY helps with your yearly income.  Will refinancing actually save enough?  What if you could pay them ALL off inside of 1 or 2 years?

I say this because I've looked into some refinancing options years ago for friends, and they usually take advantage of people more than they seem to on the surface.  I'm sure there are other options, but it seems whenever I look at trying to save money with a new loan there's somebody on the other end looking to make a profit.  I also remember (at the time) the only options I'd really have directed friend towards would only reduce the already low government subsidized loans. (Stafford loans I think they were called?)  This paragraph is poorly worded, but in short when I tried to help a friend years ago I found the options shitty.

It seems that at the moment your SO is covering the student loans now.  With you guys knocking them out together it'll happen so fast you don't know what happenned.  Contrary to the "optimal" advice, I knocked out loans in order from smallest to largest.  Given the ~1 year timeframe, the interest I would have saved doing it from highest to lowest interest would have been small, and the satisfaction of seeing loan after loan go away was amazing.

Goldielocks

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Re: Pre-Marriage Money Talk
« Reply #35 on: September 03, 2017, 09:19:35 PM »
Finance topics to talk about:

Combine, separate, or partially combine money?
How often do you as a couple want to come together to talk about finances?  (Monthly or quarterly works for many)
What would you do if one person wants to FIRE and the other doesn't and wants to spend lots more money for "fun" instead?
How will he feel if she earns substantially more, and needs to work long hours to do so?
What will happen to finances when kids come along (if they do)?  Will you change from separate to joint at that time?
What if one of you gets a disability  / depression / loses a job for a long term?

How will you figure out where to go on annual vacations if you have different ides or funding.  e.g., one wants camping and to buy a nicer car, and the other wants a trip overseas.  Maybe one person wants to visit relatives at least every other year and pay for a family disney trip for all their nephews..?

Do either of you have a large spend hoped for in the next 4 years? Car? Masters Degree?  Time away from work?  New furniture for the house?  Buy a house?  Sponsor a relative to immigrate?

Any family members that may ask you for money in the future?  What would you say and why?


Those are the ones I can think of after 23 years of marriage...  good luck!  Keep talking.