Sharing responsibility for money matters with your partner can strengthen your relationship and your finances.
Relationship and financial success have a lot in common; both rely on your understanding and attention.
When you move from the single life to being part of a double act, your personal and financial horizons expand. The better you are at working as a team, the smoother and more successful your life together will be.
As any relationship expert will tell you, it’s important to talk openly about money from the start. That way you’ll have a clearer understanding of each other’s personal and financial goals and a better chance of marrying them into a joint financial plan – if that’s something you both want to do.
Good communication and a willingness to negotiate are important, but the way you divide financial tasks and responsibilities is a personal matter.
Some people enjoy being the home’s finance director while others are happy to leave financial decision-making to a partner. But that can leave one partner at a disadvantage if the marriage or relationship ends, or one of you dies or becomes incapacitated.
That’s why a couple should consider adopting balanced roles in managing finances. This may be more beneficial in the long run than if responsibility is left to one person.
If you’re keen to achieve greater financial balance at home, either getting your partner more involved or being more hands on yourself, here are three steps to get the conversation started.
1. Identify and align your financial goals
It’s a good idea to identify and discuss your financial goals to see if you’re on the same page or need to compromise, says ANZ financial planner Stefanie Bellino.
You may be thinking about saving for a home deposit, your children’s education, or taking more holidays; while your partner may prefer to put your savings in a share portfolio or an investment property. When your goals are aligned – or at least clearly communicated – you can prioritise and choose the best financial strategies to meet those goals.
“When both partners have a shared goal and understand why they are sacrificing something today for tomorrow, financial freedom is more easily achieved, whatever that may be.” says Bellino.
2. Share decision-making
In many relationships one person takes more responsibility for finances, according to Bellino. This may be because one partner has more time, more interest or financial experience.
However, by sharing decision-making, you can help ensure both of you are aware of your financial strategies, risks and outcomes.
“People who didn’t have much exposure to financial management growing up can find it difficult to get connected to their finances or may be embarrassed to ask questions,” Bellino says.
It’s in your interest to understand major financial decisions, as it could affect your future. Your level of involvement is a personal decision: there is no right or wrong, but if you’re looking to build money confidence, resources like Grow Insights can play a role in increasing your level of knowledge.
If you’re unsure how your joint finances are arranged, consider talking to a financial adviser as a couple. They can explain the finer details so both of you are fully across the decisions being made.
3. Consider insurance that protects both of you
You work hard as a couple to build a secure financial future, so it’s important to protect that in the event of unemployment, illness or death. For example, if you became sick and were unable to pay your mortgage, income-protection insurance could help cover this cost and make a difficult situation easier for your family.
Bellino says often only the higher income earner in a couple is insured, which can cause financial difficulties down the track. Say your partner has income protection insurance and you don’t, and you become sick. Their insurance will not cover them to take time off work to care for you.
You both contribute to the running of the household, whether that be financially or through taking care of children, so your household finances will be affected if either of you is out of action. That’s why it’s worth looking into insurance cover for both of you.
If you want to achieve financial success as a couple and especially as a family, then identifying financial goals, sharing decisions and considering insurance for both partners are three great first steps.