Things are starting to get serious, your significant other is incredible and – maybe even – the one. But wait! Have you stopped to have the real conversations that can lead to problems later in life? You know, the conversations that cause both of you to get that uneasy feeling. When you leave surface level conversation and the wave of anxiousness begins to flood your veins, that’s when you know you are getting to the good stuff.
Divorce rates are high, and one of the leading contributors to divorce is a money problem. If you are thinking about getting engaged or married, you should consider asking your significant other these five questions:
1) How much do you have in savings?
According to a 2015 Google Consumer Survey, 62% of American’s have less than $1,000 in their savings account. Where do you stand in your savings plan, and where does your significant other land?
“It’s almost impossible to be hooked up to somebody who has the same balance of spender and saver as you, or expansiveness versus conservativeness or financial circumstances,” says Gregory A. Kuhlman, a New York City psychologist.
Beginning the conversation regarding your savings can provide huge insights into your partner’s financial health. Are you the spender or saver? Are you both financial mavens with thousands stored away? Your savings cushion gives insight into your current financial outlook and can set the tone for the rest of the conversation.
2) Do you have a plan for getting out of debt?
Statistically speaking, both of you are probably in debt. It is important to discuss what kind of debt: student loans, credit card, or consumer debt. Each of these debts carries with it a story. And it is important to know each other’s stories and discuss the good, the bad and the ugly.
The burden of student loans is felt by many. In fact, the average Class of 2016 graduate has $37,172 in student loan debt. Maybe you both had to pay for college and graduate school. Perhaps one of you got lucky and your parents paid for your education. Whatever the answer, discussing the financial realities of your lives leads to a better understanding of daily actions.
Credit card debt is a pain and getting out of debt is difficult. Let’s face it, we all have our weaknesses – a spa day, a new suit, or happy hour with friends – and sometimes it’s hard to say no. Learning each other’s outlook on consumerism is the quickest way to gain clarity into how future problems will be handled. Will you both rely on credit cards in a time of need? This is something to think about.
3) Have you started saving for retirement?
If this engagement and marriage is to last, you are going to be with each other for the rest of your lives. Planning for what you expect in life early in your relationship can help build bonds and form expectations of what you both envision for your life together.
Saving for retirement is one of those things, which if done early enough and correctly, can be a non-issue later down the road. Having this conversation and picturing yourself as an old couple together will only strengthen your resolve to get to your retirement savings number.
4) What is your ideal income – do you have a number?
In the movie “Wall Street: Money Never Sleeps” the main character, Jacob Moore, asks the banking titan Bretton James, “What is your number?” Cool, calm and with a wry smile, James answers, “More.”
If you haven’t thought about what your ideal income would be, now is a great time to start. We set goals in all areas of our life, why not in our finances? If you have an ideal income to attain, chasing after your goal can give you the necessary motivation to fuel your path to success.
Now, if your significant other adopts the Bretton James approach and “more” is always the answer, pump the breaks because life is never going to be enough. The question forces you two, as a couple, to start thinking about where you are in life and where you want to go.
5) Can you be poor with me?
Fortunes are gained and lost every day. What matters is that you are happy with one other – in good times, and in bad. Money is simply a means of providing texture to your life story.
Making sure that each of you is comfortable having little is a testament to the strength of the relationship. Perhaps it would be best to try living on as little as you possibly can in order to see how you both fair. It would at least prove to be a good story.
“Set aside a certain number of days, during which you shall be content with the scantiest and cheapest fare, with course and rough dress, saying to yourself all the while; Is this the condition that I feared?” – Seneca
Open and honest conversations about personal finances can help resolve major issues that could cause problems later down the road. Removing the financial facade and peering into an extremely private aspect of one’s life, can save you time and stress. Have the conversations now and save yourself time, energy, and money.