Managing finances together as a couple can be challenging.
It's critical to your present and your future to have the "money talk." Approaching this conversation with honesty and transparency can help you get started on the right foot. Here's what you can do to start things off on the right foot... and as a team!
“Too many people spend money they earned… to buy things
they don’t want… to impress people that they don’t like.” — Will Rogers
The best budgeting applications for couples are ones that sync between several devices so that you may each view them from a different phone or computer. Try out Mint and Goodbudget as viable alternatives. To find the app that works best for you and your partner, you might need to try out a few different ones.
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Community property states require that spouses share debt obligations equally, regardless of who signed for the loan or obligation. However, this rule only applies to debts incurred during the marriage. For premarital debts, the spouse who signed for them is still solely responsible. By 2022, there will only be nine states that recognize community property: Arizona, California, Idaho, Louisiana, Nevada, Texas, Washington, New Mexico, and Wisconsin.
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Both of your credit ratings will be looked at if you and your spouse apply jointly for a credit card or loan. Your application may not be accepted if you or either of you have poor credit. If the application is accepted, the interest rate and costs could be greater than if the higher credit-scoring spouse had applied independently. Even if just one spouse uses a joint account or an authorized user account, only that account's history is reported on both spouses' credit reports.
Credit card and loan payments on joint accounts must be made by both partners. Additionally, if the account defaults, the creditor or lender will make an effort to collect the arrears from both spouses. Only the primary account holder of authorized user accounts is legally liable for paying the credit card debt, but the account history will have an impact on everyone named on the account.
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It is up to each individual how to divide their finances. You may opt to divide money equally or based on how much each spouse makes. You can either have separate accounts with a joint account you can use for shared spending, or you can just have the joint account with contributions from each person. If your spouse won't share financially, one of you might reimburse the other for their respective share of expenses while the other could make payments from their own account.
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Put everything on the table, including all of your invoices and documentation. Determine how much you will ultimately owe each month, how much income you will have overall, and how much will be left over after all is said and done. Don't forget to account for any prospective honeymoon or wedding costs. Also useful are spending restrictions. Set a limit on the amount of money each of you can spend without consulting the other before making those vows.
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1. Set a date and time for a discussion aka a money date.
2. Be inclusive when speaking to your partner.
3. Listen carefully to your partner and avoid placing blame.
4. Start with shared values.
5. Look ahead (the next 1-3 months) with your shared goals.
6. Always celebrate your accomplished goals together.