Why money matters in your marriage
Disagreements about money can lead to divorce. So, it’s a good idea for you and your partner to talk about finances before you say your vows.
Money touches so many aspects of your life together including the size of your family, where you’ll live, and your lifestyle before and after retirement.
To help you have the “money talk” with your partner, we’re providing lots of financial questions to ask before you wed.
Questions about family and growing up
Was money discussed at home growing up?
Financial awareness as a young person can influence how you manage money as an adult.
How were your parents with money?
Our parents can often provide both good and bad lessons about managing money. Were they savers or spenders and how does that affect your relationship with money? Did they stick to a budget and are both partners comfortable doing that?
Are you willing to spend money on aging parents or if they require help/get sick?
It’s difficult to determine how much this might cost, so you may simply need to reach an agreement on this question.
Would you take money from relatives if they offered?
Some people aren’t comfortable getting financial help from family, so you it’s a good idea to discuss this. You may also wish to discuss whether you expect to receive an inheritance.
Would you help your siblings financially?
If the answer is yes, how much would you provide and would you expect them to pay you back? You may want to set guidelines when you might consider lending money and what the terms would be.
Will we both work once we start having a family?
This is important to discuss as it can impact how many children you have, where you’ll live and how you’ll retire.
Questions about your goals and desires
How many kids do you want to have?
While you may have talked about how many kids you want, it’s important to understand the financial costs of having children.
Will you save for your kids’ education?
If you plan on paying for your children’s education, you discuss when and how you plan to do that.
What is your ideal standard of living?
Talk about what’s essential vs. non-essential to your lifestyle. What compromises are you willing to make to achieve important financial goals? What bills/subscriptions/memberships can’t you live without?
At what age do you want to retire?
While it may seem like the distant future, at some point you’ll want to stop working. Do you expect to retire at age 55 or 65? Talk about your goals and how you expect to get there.
Do you want to own a home?
Depending on where you live and how much you earn, owning your home may or may not be achievable. Some people aren’t comfortable committing to such a long-term obligation as a mortgage or taking on that much debt. Talk about this and whether you’re both OK renting instead.
Questions about debts and worries
How much debt do you have?
This may be the most important question you can ask your partner as you head into your life together. If one partner brings a lot of debt into the marriage it could mean they have difficult time managing their money. This could also handcuff your finances later on as your income is used to pay down that debt.
Have you ever declared bankruptcy?
Every partner deserves to know this. A bankruptcy on one partner’s record can impact the couple’s ability to get credit down the road. What was the reason for the bankruptcy?
What would you do if you had to declare bankruptcy?
If your financial situation became this serious, you should talk about what you’d do, or what you you’d do to prevent it from happening.
Do you owe money to friends or family?
If you do, how much do you owe, and when do you expect to pay them back?
Do you have credit cards?
If the answer is yes, how many cards do you have and what are the balances on them. How to you use your credit cards and do you pay off the balances at the end of each month?
What do you think about good debt and bad debt?
Partners should discuss when to use credit and when not to avoid misunderstandings later on.
How do you pay for your wedding?
This one of first tests for your relationship. How much can you afford to spend on your wedding, and how will it affect your financial future after you’re married?
Questions about paying your bills and managing your finances
Who will pay the bills?
It’s important to understand which partner is in charge of day-to-day finances so they aren’t missed. You may decide that one partner should do it, or that you’ll take turns.
Are either of you getting any help paying the bills currently?
If yes, how much are they paying, and will this continue after you’re married?
Do you want to combine finances or keep them separate and why?
Because couples are generally marrying later in life, and have kept their own accounts for a while, they may find it difficult to merge their finances with someone else. However, it can be convenient to share at least 1 account to pay shared expenses. If this is your choice, determine how much each partner contributes to this shared account.
Other couples choose to completely merge their finances so there are no secrets.
Who will do your taxes?
Taxes must be paid ever year. Will 1 or both partners do their own taxes, or will you leave the task to a professional. There are some instances when doing your taxes together makes good financial sense.
Questions about investing and saving
Will you invest separately or have a joint investment account?
Just like having your own savings and chequing accounts, some partners are reluctant to invest with someone else. However, there may be situations (such as a spousal registered retirement savings plan) where it makes more sense to invest with your spouse. With some investments, you may also pay additional fees if you invest separately.
Who will fund your investment accounts?
Will you both of you contribute to your investments or just the partner who makes the most money? This may depend upon the group investment opportunities each of you has with your employer.
Should you invest alone or with an advisor?
Some couples may be comfortable with one partner making all the investment decisions. However, if the partners have different feelings about investment risk, or if neither wants to make investment decisions, it makes sense to work with an advisor. This advisor can also provide important information about other aspects of your financial wellbeing such as life insurance, critical illness insurance, disability insurance, health and dental insurance, saving for retirement (registered retirement savings plans), saving for other goals (tax-free savings account), or saving for a child’s education (registered education savings plan).
As you encounter the twists and turns life throws at you, an advisor can also help you adjust your goals and finances accordingly.
Questions about entertainment and miscellaneous spending
How much cash should be set aside for vacations each year?
You may have a different idea of what a vacation is and what it should cost (i.e., camping vs a cruise) and what a vacation should cost.
Will we both have “fun money” set aside for shopping, etc.?
If the answer is yes, how much money should you both set aside each month for playful spending?
Can you live within a budget?
The ability to create a budget and live within it can tell you a lot about how someone’s ability to manage their money.