Before you walk down the aisle, to take the promise of a lifetime, you may have discussed various aspects of ‘compatibility’ with your partner. But it’s likely, one issue would be silently left. It is the dirty topic ‘money’ that’s considered rude to discuss and yet is a subject matter that would be among the key edifices for your married life. If there is one thing that most people consider too embarrassing or even evil to discuss, it is money. Sadly, it is money matters that threaten to be the undoing for many a married life.
So, setting aside your shyness and knowing that it is in the interest of your partner and yourself to discuss this, do explore the following conversations with your fiancé or likely partner:
1. Spending and saving
Not all couples come from the same socio-economic background. Even if they do, they can still have varied spending and saving habits. It is, therefore, better to spell out each other’s income and what kind of a lifestyle would such an income afford the two of you. This is best done by drawing a tentative budget of how much money, as a family, you can spend and how much needs to be compulsorily saved. The spendthrift or the scrooge in you needs time to learn to let go a bit too. This is best discussed upfront as this can lead to much unpleasantness post the wedding.
If there is dual income, then there is all the more reason to discuss this, to understand who will contribute how much towards running the house and how much can each save. Having a common bank account into which money can be pooled for common expenses reduces any unpleasantness as to who contributed how much and for what purposes.
2. Assets and liabilities
Your asset holding and your liabilities are a necessary part of the money discussion. Property, investments and also loans taken before the wedding need to be disclosed to the other partner. When budgeting for monthly cash flows, your partner has a right to know how much of it would go towards EMI, be it taken for your education or home loan. Also, in case of property, if you hold the property jointly with your parent or sibling, such details are also best disclosed to avoid discord at a later stage.
3. Setting financial goals
It is very important for the couple to set broad financial goals and set a time frame for achieving them. While this may sound premature, such planning is vital as it helps the couple plan their spending and savings pattern better. For instance, if buying a car is a short to medium term objective, then the couple will not only know that they should have enough cash flow to pay for it upfront or through EMI, but also accordingly spend more wisely in the short term.
More imperative decisions such as whether to have children and when to plan would also be important as your bundle of joy is an addition to the family’s joy as well as to the family’s expenses. Any fundamental difference on this count is best thrashed out before the wedding and is best planned a few years post marriage. This decision and other larger decisions such as buying a house together are ideally best done after a couple of years of marriage, when your married life shows stability.
4. Financing dependents
More often than not, the subject of dependents in each partner’s family and the need to financially support them can lead to irreconcilable differences between couples. It is best to be open, honest and state clearly the facts and let the other partner know why it is so and how much of monthly or periodic cash outflows will occur as a result. Supporting one’s parents or siblings is a personal choice, no doubt. However, once a partner enters your life he or she starts participating in your financial life as well; hence it is best to discuss this upfront.
5. Be financially aware
In most marriages, it is one person who would typically end up taking charge of the family’s finances. However, there are a few reasons why it is imperative for both the partners to involve themselves in decisions or at least be aware of what is being done and when. One, when both partners are involved, chances are that, any crucial aspect that may have been overlooked may come to light and help make optimal decisions. Two, in the event of unforeseen events, one of the partners need not be left in the dark about the state of their money. For these reasons, awareness about money and a commitment to keep the spouse in the know needs to be made before tying the knot.
Your financial life too shall be a vow “to have and to hold, from this day forward, for better and for richer, so that money never do us part.”
(By Vidya Bala, Head-Mutual Fund Research, FundsIndia.com)