Money! It’s not romantic and sitting down and writing a budget is something that most of us simply don’t want to do. Especially in the first flush of a relationship.
Whether you have been dating for years, talking about moving in together, or just getting to know each other, it’s important to have a conversation about your debts, your savings and where you want to be financially.
After all, both sides are giving up their independent life. And, in many cases, there are homes, cars and savings to consider.
Shakespeare wrote: “The course of true love never did run smooth”. And that was over 400 years ago!
To help you navigate this, Easy Street has assembled some tips on how to make the most of your partnership – and ways to look out for yourself right from the start.
If you decide that you are ready to open a joint account together, it’s important to understand that you are giving your partner access to your money; however you will also have access to theirs. Joint accounts work well for couples who spend money in a similar way. Both people should agree how and when they will deposit and withdraw money, to meet the same goals.
If you live together, it’s ideal to have both your names on your bills such as – power, house insurance and water, making you equally responsible. Any assets that you have together, such as a – house or car should be in both your names. This is so both people have an ownership of the asset and are both responsible for the debt.
Credit cards and loans
Think twice before putting your name on a loan that will only benefit your partner, such as a car loan or a credit card. Keep in mind that a joint loan does not mean you’re responsible for half the debt. If your partner defaults on the loan repayments, you may be liable for the whole amount, including fees, interest and charges.
Past financial history
If you plan on purchasing a house with your partner and taking on a mortgage, your partner’s past financial decisions will play a big part in getting your home loan improved. It’s important that you understand not only your own debts and liabilities, but also your partners and what they are bringing into the relationship. Don’t worry, it’s not all doom and gloom! Use the time you have to understand your situation, make some common goals and improve your financial situation before you apply for finance.
Plan for the future together
One of the biggest benefits of being in a relationship is that you have a team mate. If you are both working and have no dependents, this is the perfect time to really make a dent in any debt or work on a savings plan together so that you can achieve your goals. Once you understand your financial situation as a team, the next step is to ensure that you stay on track. To do this we recommend having a monthly conversation to touch base about where your money is going.
If you are looking to open a joint account with your partner, why not take a look at an account like the Easy Savings Account*, it’s a flexible account, meaning your can save as little or as much as you like, you’ll earn interest on your money and won’t be penalised for making withdrawals. You can find out more here.
*Our product Conditions of Use are available at www.easystreet.com.au. You should read and consider these Terms and Conditions when deciding to use any product. This information is general advice only and does not take into account your objectives, financial situation or needs (your “personal circumstances”). Before deciding whether to buy any product you should consider your personal circumstances. Easy Street is a division of Community First Credit Union Limited ABN 80 087 649 938, AFSL/Australian credit licence 231204.