Money is one of those taboo subjects which a lot of couples don’t like discussing. However, knowing whether or not you and your future spouse are compatible when it comes to finances is super important! Before you enter the next phase in your life together, you need to make sure you’re on the same page and have the same long-term goals in terms of money. We’ve asked a professional finance consultant who specializes in family and couple financial dynamics to weigh-in on what’s important for couples to discuss before and after marriage. Paul Nourigat is the author of nine financial success books and most recently published No Time To Wander: The Financial Compass for Young Americans.

Early in a couple’s courtship, physical appearance, values, communications and common interests are at the forefront of most people’s considerations. Financial compatibility often takes a backseat, yet is a critical cornerstone in the foundation of a strong marriage.   

Do you share your hopes and dreams?

Usually, the answer is a huge “YES!,” yet converting those hopes and dreams to reality requires coordination and discipline. Couples benefit by agreeing on their priorities, which then provides a framework to guide day-to-day decisions around earning, spending, and saving. This reduces the stress which can otherwise arise when a couple diverges on financial actions, given personal choices, life’s distractions and the complexities of money. Moving beyond dinner table dream talk, writing down and agreeing on the staging of your priorities provides clarity and purpose in a couple’s life plan.

Have you shared your financials?

Even with a common set of future goals (hopes and dreams), many people are surprised to learn of the financial challenges of their spouse after the knot is tied. While financial motivations may not be primary in the selection of a spouse, it’s a good idea to have a clear understanding of the financial posture of each partner, including their history of financial dealings and if any credit problems remain in their life. Candidly discussing this and having credit checks run for each spouse provides a clear path to what needs to occur going forward, including corrective behavior. Many good people have struggled financially over the past decade and can move past such challenges with an open discussion, agreements on needed changes and a supportive spouse. Doing so early in a relationship reduces the angst of unknown and compounding effects which can fragment a couple’s bond.

Keeping it simple

When you really boil things down to the essentials of personal finance, here is the summary list of what matters early in a marriage:

• Earnings – establish solid income streams, providing the capacity to build a future; supporting each other’s career ambition is essential in building financial stability.
• Spending – make disciplined decisions about “how much” should be spent on “what items;” spend less than is earned.
• Savings – create a rainy day fund, in a simple savings account to keep the funds parked in a different physical and mental compartment; the ability to fund a couple of months of living expenses in the event of a career disruption is the objective. When the rainy day fund is built, immediately begin investing money in retirement accounts. 
• Debt – avoid consumer debt, other than well-grounded decisions to finance a car or home purchase, or potentially to continue education.

The Power of Process

The delegation of duties, or “who does what” is a process which can empower a couple.  Based on skills, time available and interest level, couples can divide financial duties. A key success factor is that such delegation is agreed upon and that each spouse is accountable to the other for their responsibilities. The second important process is a periodic review; most couples do not place a financial review at the top of their list of preferred monthly activities, yet, throughout my financial consulting career, many of the thousands of successful couples I have advised take the time to sit down formally and review progress. Even a short 30 minute session each month will keep things on track, identifying concerns before they become problems, and ultimately motivating couples through the progress report we all appreciate. Now in our 31st year of marriage, my wife Lisa and I still sit down regularly to reconcile accounts, discuss cash-flow, and to evaluate longer term objectives, progress, and concerns. 

The Thrill of Progress

To see growth in your savings for a new home or for a child’s future college expenses creates a deep sense of satisfaction and a unique bond between two people working together on a common long term goal. It is this feeling which can carry a couple through more challenging times, such as when other consumer pleasures are bypassed in order to save for a long term goal. It’s important to celebrate your progress along the way; consider clipping out images which convey those future victories and put them in a central spot to remind you of the mission you are on.

Getting Help

There are certain financial topics which most smart people will never master, due to the infrequency of such topics arising. Yet, such things as the annual ritual of tax filing, or the acquisition of  a new home, or the determination of how much to save for college are very important planning topics. I encourage each couple to establish a relationship with a CPA or Registered Tax Preparer for tax filing and a strong financial planner who can illustrate the cause-and-effect of various financial decisions. These professionals can help you move forward with confidence, through their technical expertise, the facilitation of discussions and the avoidance of costly missteps.

Learn together!

If you feel uninformed about money, you’re not alone. Most people avoid the topic due to their embarrassment that they do not know more, yet all couples can build financial competency together. It’s important for couples to learn financial fundamentals, helping each other to fill gaps and avoid the challenges which can otherwise arise. As with most things, one partner often is more financially fluent than the other, yet couples benefit when both partners have a solid foundation in financial fundamentals. This can come from sharing knowledge and experiences, taking a class, studying online resources or of course reading a great personal finance book! 

Book cover image courtesy of James Beihl and author photo courtesy of Paul Gulick.