Learning how to talk about money with your partner is probably easier than you think. It can be as simple as learning what conversations to have, and how to have them. Here are some tips to help you get the ball rolling. 

How can you start a conversation about your finances?

Actually, the answer is pretty straightforward: be open. They say honesty is the best policy, right? Well we can tell you, it’s true with money, too. Set expectations for your partner about how you like to tackle your finances. Explain where your interests and priorities lie, and then invite them to do the same. We know it might sound like old school advice, but communication really is the cornerstone of building a future together – especially a financial one.

Here are a few questions you can ask each other to help spark that openness (and don’t be afraid of #1!):

  1. Do you have any debt? If so how much?
  2. What's your approach to saving and paying down any debt?
  3. What big ticket items do you plan to buy: a home, a car, a trip?
  4. Where do you see yourself in the next five years? Do you want to go back to school, change careers or start a business?

Use these questions to get an understanding for each other’s finances, then use that understanding to help guide future decisions for your money.

Should you merge your finances or stay financially independent?

There's no one answer for the “right” way to handle finances in a relationship. Every couple is different, and every couple handles their finances differently.

When partners have drastically different salaries, a good approach can be to maintain your own bank account – and even your own credit card – which helps both of you maintain some financial independence. That injects a sense of freedom into your financial relationship, and you can then put your money together for shared expenses like rent, food or a car. You can even open an additional joint account that you both pay into and then use to cover those expenses.

Whether it's joint accounts or splitting bills, you and your partner get to decide what feels right for you.

What can you do to tackle different incomes in a relationship?

If one partner earns a higher salary, it can lead to friction around both expenses and savings. In some cases, it makes sense to avoid splitting expenses down the middle as it can make one partner feel perpetually underwater. When you pool money together for shared expenses, consider weighting the contributions of the higher earner more heavily. That might actually feel more fair in the relationship, and it won’t make anyone feel like they’re behind, unable to contribute or able to keep up.

Keep in mind, however, that it’s a good idea to share assets and savings equally. As assets grow in value, seeing one partner garner a higher share could feel unfair, and maybe even undermine the relationship you’re both building. 

However you choose to handle your expenses and savings, it's important to check in. Like we've mentioned – they say communication is key to a happy relationship! Things change, money flows in and out, and you should have frequent touch bases with your partner about your finances to make sure you're both on the same page (and heading towards your financial goals).

How can you handle debt within the relationship?

We’ve said it already, and relationship experts will probably keep saying it: be open and honest. Be open about the debts you have, then – and this is important – make a budget that includes paying down that debt.

It’s really a no brainer. A budget does great things for your finances, including showing you what you’re spending your money on, what you have to pay for, what you need, and what’s left for what you want. It can help you get your financial priorities straight, and make sure you’re paying down your debt each month. If you want to amp up your budget game, you can try a financial roadmap from Prospr.

You can also look into consolidating your debts, so you have fewer payments, and fewer debts growing interest. To pursue this, it’s a good idea to talk to your bank or your creditors to see what they offer to help customers reduce debt. Another great idea is to get professional help from an advisor. Advisors can not only help you reduce debt and save more money, but they can help review your current financial situation and make a plan to help meet your short- and long-term goals.

What steps can you take to work towards a major purchase or goal?

See above. Okay, there’s more to it, but a budget is likely the best first step you can take. Make a budget you can stick to and put in a contribution towards your goal.

Of course, some goals can take time to reach, sometimes even years. It can be a good idea to schedule an annual financial meeting with your partner. An easy time to do this can be in the spring when you’re looking at your finances for tax time. Having everything in front of you can make it easy to track how much you’re earning, how much you’re contributing to savings and RRSPs and how you’re tracking towards your financial goals. (After you sign up for Prospr, you can link all of your bank and investment accounts so you can easily view your finances in one place.) An additional bonus: setting an annual meeting can relieve the pressure of feeling like you have to micro-manage your finances 24/7. 

But what happens when couples have different spending habits or financial priorities?

To manage different habits and priorities, it’s helpful to find common ground. Sit down and work out a financial goal that’s appealing to both of you, whether that’s buying a house, saving for a dream vacation, retiring or starting up a registered education savings plan for your children. Focus on the positives of those goals, like living debt-free, buying a house with features you both really want or building the future for your family. Use that excitement to align on the financial decision you need to take to make that goal a reality.

You can also work with an advisor. An advisor can help assess your goals as a couple and individuals, as well as showing you ways you could make them work together. Curious what’s involved in talking to advisor? We’ve got that covered here.

Are there common financial mistakes that couples should be aware of?

Couples can make the same mistakes as any individual, and benefit from the same things that help all of us manage our finances more effectively. However, there's one common mistake couples specifically make when managing their money – thinking there are “rules” that need to be followed.

Try to keep things flexible and remember that everyone has their own approach to money. Make sure both of you are involved when it comes to planning your finances, find an approach that works best for everyone, not just whoever has the loudest voice. Tailor your system to the realities of your life, your unique financial goals and to the ways in which you both prefer to engage with your money.

And remember, what your friends do might not work for you and your partner. It's up to the two of you to find the right flow when it comes to managing your money.

Do you need a pre-nuptial agreement? A post-nup?

A pre-nup or post-nup, also called a “marriage contract” can help save a lot of grief if your relationship ends. While it might not sound romantic, it can help both of you if the marriage ends, and it is romantic to take care of one another.

You can have a marriage contract written up before or after you get married, and you can likely adjust your contract if your financial circumstances change while you’re married (say, if someone gets a significant inheritance). It’s a great way to make sure you both feel comfortable with how your assets will be divided should your relationship end, as well as to take care of others affected by that relationship, such as any children that come from a previous marriage.

Having a financial discussion with your partner may sound like the least romantic topic to cover, but remember it’s a labour of love. Show your partner this article as a starting point and then you’ll both be singing from the same hymn sheet.

And don’t forget, Prospr advisors work with many couples and partners. If you want guidance figuring out what steps to take, and what approach could work for you, they’re here to help.

NOTE: This article is for your general information only. Sun Life Assurance Company of Canada (Sun Life) doesn’t give legal, accounting or taxation advice to advisors or clients. Before you act on any of the information here, make sure you get advice from a qualified professional. That will include a thorough review of your specific legal, accounting and tax situation.