Having a heart-to-heart about your spending preferences with your significant other before you move in together can be key to starting a life together on the right foot.
“Money can be a major source of problems, even in unmarried couples,” says Jennifer Dunkle, a certified financial therapist based in Fort Collins, Colorado. It’s also one of the topics we tend to avoid. “It’s really the last taboo,” Dunkle says.
However, a person’s approach to money can tell you a lot about them, what they value, and what their goals are. It will also give you a better idea of what life with this person might look like. For that reason, it’s a topic you definitely want to broach before this big step.
Worried about awkwardness? Dunkle recommends using a worksheet or questionnaire as a tool to break the ice before cohabiting. This list is a great place to start.
1. Who Pays For What?
First, find out what’s the most you can pay in rent, utilities, insurance, and other shared necessary costs. What about your partner? Keep in mind that it may not make sense to contribute the exact same amount.
“It’s not fair to ask your partner to pay more than they can afford, and it’s not fair to ask you to move somewhere you don’t want to live,” says Megan McCoy, a professor of financial therapy at Kansas State University. A good solution can be to split things proportionally rather than 50/50—if one person makes 30% more than the other, they can contribute 30% more to the expenses. That can keep resentment from simmering, and keep both partners financially healthy.
“Make sure the arrangement is such that, if in the event of a breakup, you can both make it on your own for one to two months,” McCoy recommends.
Once you’ve settled on your total financial commitment, outline the details. Who will be in charge of rent, utilities, groceries, furniture for the living space, and other expenses (down to toilet paper)? Make sure you both agree on how reimbursement will work, and how you’ll divvy up shared items if you part ways.
2. What Are Your Spending Habits?
Before you move in, understand what kind of financial lifestyle your partner is used to. Money talk can be a tricky topic, says McCoy: “Finances are difficult because you’re pretending to talk about money, but what you’re really talking about is power and safety and fear and the future.”
For some people, money feels like security, and having a few thousand dollars squirreled away for emergencies provides serious comfort. For others, spending feels equivalent to experiencing freedom and living life to the fullest. To keep financial conversations comfortable and productive, know what emotions your partner might have tied up in the subject first.
Once you have a sense of the other person’s financial goals and their relationship to money, make time to talk about your financial goals as a couple. Are you both saving up to move into a nicer place? To go on vacation together? To buy better living room furniture? If so, how much do you need to save each month? What compromises might you both need to make? Use that information to make a long-term budget together.
3. How Will We Keep Track of Joint Expenses?
Decide on whether you’ll use an app like Splitwise, or an analog spreadsheet to keep track of who’s paid for what each month.
It’s true that a joint account can make it easier to monitor joint savings, and you’re less likely to incur overdraft fees if two incomes are pouring into the same account. However, it’s a pretty committing move: In some states, if your partner has debt, all the money in a joint account can be garnished by creditors. In that case, you take on all the debts of the person you open a joint account with. Cosigning for someone you’re dating can be just as risky.
“Honestly, if you’re not 100% committed to this person, I’d recommend avoiding cosigning or joining accounts,” says McCoy.
4. How’s Your Credit Score?
Asking about debt and credit can feel nosy, but if you and your partner are coming together on financial goals, you need to know about any obstacles that might arise on your journey there. That includes outstanding credit card debts, student loans, a low credit score, or a lack of savings.
The good news: Studies show that opening up about your money concerns and sharing in financial decision-making can actually increase relationship satisfaction. This is especially if you word it right, says McCoy: “Frame the conversation with the mindset that all financial problems are fixable,” she says. “Figure out what your financial future is going to look like together, and work as a team to get to those goals.”
5. How Transparent Should We Be About Our Spending?
About 75% of adults say their relationships have been impacted by financial infidelity. Financial infidelity can mean everything from hiding whole purchases to just rounding down, McCoy says.
Talk to your partner about your expectations for transparency before shacking up. What percentage of your respective spending should be no-questions-asked freebie money, and what percentage should be saved for joint goals or expenses? Would hiding spending habits or debt be a big deal?
“In general, the more transparency, the better,” says Dunkle. If you suspect your partner is embarrassed to share, Dunkle suggests opening the conversation by being upfront about your own habits. “Try to be inviting rather than demanding,” she says.
6. How Can We Work as a Team?
Make a plan to keep both partners invested in the financial planning process. Maybe that means making a date to open the laptop and a bottle of wine one night each month to go over the numbers, or maybe it means splitting financial chores 50/50.
If your partner goes nuts over spreadsheets, it can feel easy to hand over the reins. There are plenty of married couples who let just one person handle all the bill-paying. However, keeping both people engaged means you’ll be more likely to stay on track with your savings goals. Besides, if you’re unmarried, your likelihood of splitting up is statistically higher. “If you break up, you’re going to be grieving the relationship—you don’t need to be learning how to do a budget while you’re dealing with all that,” says McCoy.
Disclaimer: The opinions expressed by the interview subjects are not necessarily those of Earnest.