Talk to Your Fiancé About Money Before You Get to the Altar

This is a guest post by Ryan Harrison. Ryan is a New York native and single dad working on his MBA.

To send a guest post proposal, contact me at [kadebg AT abv DOT bg] .

Many years ago, when a newly married Chris Rock appeared on “The Oprah Winfrey Show,” she asked him: “What’s the most romantic thing you’ve ever done for your wife?” His answer: “I paid off her credit cards.” Not every guy has Rock’s generosity (or money) to pay down his girlfriend’s or fiancée’s’ debts, but we all know someone who’s done it. The reason we do it is simple: We don’t want to marry debt. Changes in behavior and attitude toward money must go hand in hand with paying off bills.

newlyweds jar Before you take the plunge, have more than one frank discussion about where you are financially, where you have been in the past and where you want to go together as a couple. Sixty-five percent of couples in a Manilla.com survey reported that they fight about money. Don’t be one of those couples.

When Should Couples Discuss Money?

Sex and money are two of the most intimate topics a couple can discuss. Two very simple tests will tell you when you are ready:

1. If you aren’t comfortable talking about sex, you’re not ready to have it.

2. If you aren’t comfortable talking about money, you’re not ready merge households.

The right time to discuss marriage is some time between “I love you” and “I do.” Financial expert and author Dave Ramsey says the money talk should happen when a relationship gets serious and before it becomes permanent.

How Much Should We Reveal?

A marriage is as much a business agreement as it is a commitment for love and happily ever after. Get comfortable now talking about spending and savings. Here’s what you should share:

–Loans: Credit card debt, mortgages, car loans and student loans. If you are repaying anyone for anything, that gets disclosed.
–Income streams: In addition to disclosing your salaries, tell each other about any additional sources of income you may have. If you collect structured payments from an annuity, they don’t necessarily become community property when you marry (check with your attorney or financial adviser). However, hiding income from your partner brings up trust issues. Consider using a company like J.G. Wentworth that can buy your future payments for a lump sum—you could use the money toward your first home.
–Credit scars: If you’ve filed bankruptcy, defaulted on a loan, experienced foreclose or some other credit scar, that gets disclosed.

Financial Red Flags

Keep your eyes open for red flags that could indicate your fiancé is hiding financial skeletons.
–S/he gets a lot of phone calls from “Unavailable” and ignores them.
–S/he hasn’t checked her mailbox in weeks.
–S/he never offers to pay for anything.
–You’ve caught him/her in lies about money.
–S/he doesn’t want to talk about money.

Remember, debt and bad credit your fiancé accumulates before you marry will not affect your credit. When you get married, her bad credit will not mar yours; however, it will make buying a house together a little more complicated. If she adds you to an account or if the two of you open accounts together, your actions will affect each other.

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6 thoughts on “Talk to Your Fiancé About Money Before You Get to the Altar”

  1. In addition to this article, I’m thinking that if a couple (married or not) does not share all the bad credits or loans, it will not share the incomes as well.

    Do you think it is best for two people who live together to have separate finances or it would be better to merge them?

  2. Hi Petya,

    I think that each couple is different. I know couples that have completely merged finances, and I know other couples that like to keep things separate EVEN THOUGH they are living together.

    To me personally, keeping finances separate is okay if the couple just got together, but after a while it speaks of a commitment issue. It’s hard for me to imagine why two people who are devoted to each other would keep their finances separate :) But I guess that’s a personal choice, and if the people in the couple are happy with it, then it’s fine.

  3. Well there is a third option – a partial merge.
    Each one in the couple pays his/her share in the common finances and spends the reamining of the salary the way he/she likes.
    This is the best way when the people are financially unequal or when one of the participants has debts or loans (nobody said the shares must be equal).

  4. Yes, that’s an option too, but it can only be temporary. After, say, a year of living together, you have to make a choice – you either go all in or you go all out :)

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