Financial Planning For Couples Moving in Together
Moving in together with your partner is a big step, but it’s more involved than just picking up their clothes from where they left them on the floor.
It is important to talk about how you’ll manage your finances as a couple. According to Rita Cool, Certified Financial Planner from Alexander Forbes Financial Planning Consultants, “it is important for a couple to discuss and define their financial goals and objectives. Once this has been done a couple can find ways to work together to ensure that they reach their goals.”
Relationships can be tricky at the best of times, before adding finances into the equation. Cool advises couples to do the following:
Be open and honest with your partner about how you are currently managing your money, especially if you intend to have joint ownership of property and assets outside of marriage.
If you are not married, it is advisable to consult a lawyer to draft a cohabitation agreement to outline important information about the structure of the financial side of the relationship. The agreement will also make allowance for children and the untimely death or disability of a partner. Even though you may not want to think about it, you need to consider what will happen should the relationship not work out.
If you are getting married, you need to decide if you will have a white wedding or a traditional wedding and whether you’ll be buying a house or renting one. You have to take into account the cost of each and, where possible, try and avoid accumulating debt.
It is important for you to have your own personal financial goals, as well as couple goals. Maintaining financial independence helps, especially if the relationship ends or a marriage dissolves by death or divorce.
Maintain your financial independence outside the relationship. If you are married, try set a personal budget that is separate from the household budget, so that you can work towards achieving your personal financial goals.
NB: Always remember that any life changes such as marriage or divorce are important times to meet with your financial planner and review your financial planning.
Source: Alexander Forbes. Image: iStock.