Money and Relationships: Having the Talk

Posted on July 20, 2021

Talk about money and relationships can be difficult for couples looking to level up their relationships. There is the immediate feeling that you're reaching a point of no return. Combining your money makes it harder to walk away. 

However, every relationship will reach the point where the money talk is not only important but also essential to the survival of the relationship. Don't believe it? Take one look at Canada's high divorce rate and how often financial issues are cited as a major contributing factor.

It can certainly be difficult to re-organize individual money management into a joint account, but it’s necessary at a certain point. That's because financial stress can drive a wedge and cause partners to lose respect for and trust in one another.

In the following article, we're going to give you some practical advice for how you can avoid this issue. It's all about how and when you approach it. Let's begin!

How to Talk Money with your Partner

A couple talking about money can find the conversation tenser then they're expecting. Without proper preparation and the right attitude, many of your views on money and relationships are likely to catch each other off guard. For approaching the subject, it's important to prepare ahead of time.

First off, the money talk is not first-date material! It doesn't have to be second or third date either. That said, you do need to start thinking about it as soon as you can see a future with the other person.

At whatever point you feel committed to this person, you should start envisioning future details. One of the most important is finances. If you feel like it's time, give them a heads-up. 

First, ask them if they wouldn't mind talking with you about it and if they have time coming up to do so. From there, make a list of any questions or concerns. At the start of the talk, you might ask them if there are any questions or concerns they have for you over finances.

The "you first" approach can make the passive partner more comfortable with where the conversation is heading. Just make sure you come to the conversation with no sense of judgment. 

Decide Who Pays for What

If there was a fair money conversion chart for couples, it would not operate on a 50/50 balance unless the two parties made the same exact salaries. That's usually not the case. One partner is typically the "breadwinner" while the other is a contributor. Deciding how much one party pays requires an understanding of what each is currently contributing.

Start by adding up the shared bills and expenses. Bills are essentials like rent/mortgage, running water, and electricity. Expenses can be essential but can also be downsized or dropped at any time (i.e., Internet/cable, car payments, car gas, groceries, etc.). 

Also, consider the payroll deductions you each have. If one party is to carry more than the other, they're making a significant contribution to the budget that doesn't quite show up in take-home pay. Factor that in as you decide how much of what is left goes towards the family budget.

Be Honest About Money

Talking about finances only gets tougher if you dance around the truth. Look now at the liabilities you're both bringing into the relationship.

This would include things like bills, expenses, loans, or credit card debts. Your partner deserves to know the good, the bad, and the ugly about your situation. 

Financial betrayal is a very real thing. If one partner lies about financials or is shadowy about them, it can hurt as badly as an affair. It's also a pretty good indicator that your relationship isn't ready to level up. 

One last thing: this doesn't just apply to "the bad stuff." It also applies to income. Hiding money (as four in 10 Canadians are guilty of doing) gives your significant other good reason not to trust you. 

Make Money Goals Together

Once you've found the right time for when to discuss money and you're busy creating a financial plan, start transitioning money talk into how the joint financial situation will work. Note that this conversation can be had following the initial conversation. There might even be months between the two.

Many couples will set up their finances with three accounts: one for each partner and a joint account that the initial pay cheques pour into for purposes like paying bills and expenses. Other couples might feel more comfortable going with one account, period, while still others prefer to keep two separate accounts the other never sees or manages in any way.

The joint financial option you choose is important because it can either create tension or relieve it. Discuss the type of system your parents might have modelled for you growing up, if applicable. Also, commit to an honest picture of what you envision from one another.

We recommend vetting your options thoroughly, not just for your joint account but for all of them. Things you should watch for include the following: 

  • Accounts that pay interest
  • Mobile-friendly access with both chequing and deposits
  • No monthly fees
  • No minimum balance
  • Limitless free transactions

Make the decision together. That will help you both feel like you're at the same level of buy-in. It will also get you in the right mindset that you're in this together.

Money and Relationships Do Not Have to Create Conflict

Money and relationships can be fertile ground for conflict, but they don't have to be. Committing to the money talk, preparing for it in advance with your own list of questions and concerns, and a lack of judgment will go far in helping you to open up to one another. 

From there, you should arrange a fair budget that accounts for all the contributions you're making in relation to what your earnings are in the relationship. Insurdinary has been helping Canadian couples find the best joint accounts for their needs for several years, and we're ready to help you as well.

Contact us today at Insurdinary to compare rates and learn more!

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