Managing money can be complicated for one person. When it comes to managing it for two, there’s plenty of room for misunderstanding. If you’re managing money as part of a couple, keep these tips in mind.
Hold regular money conversations.
Nearly 1 in 10 couples in committed relationships keep major financial secrets from each other, such as debt, large purchases or income. While there is no rule requiring you to share everything, both of you can benefit from being on the same financial page. By setting some time aside quarterly or monthly to talk about your financial goals as a couple, you can begin to craft a plan that works for both of you.
Share credit scores.
One thing you should be willing to share with one another when you get into a serious relationship or marriage is your credit score. If you’re ever going to apply for a loan such as a mortgage together, lenders will consider both scores, so you need to know what you are dealing with.
Decide if you want joint or separate accounts.
Every couple should come up with the financial system that works for them. Some may prefer having a joint account, while others may prefer to keep accounts separate. Some couples have a joint account for shared expenses and individual ones for their other funds. As long as the two of you agree that it works for both of you, there is no wrong choice.
Create ground rules.
If you have a joint account, it might not be practical for the two of you to talk about every potential purchase that one of you wants to make. However, you can set up a rule for when a discussion is mandatory, such as when one of you wants to spend more than a certain amount.
Be careful about commingling credit.
Sometimes it makes sense to apply for a loan together. Other times it doesn’t. While you may be able to afford a more expensive house, for example, with two incomes, the lender will also consider the credit risk each of you presents. If one of you has a low credit score, you may be offered a higher interest rate or not qualify for the loan at all. If you’re thinking about buying property together, a Homeownership Advisor can look at your unique situation and help you determine whether it makes more sense for you and your partner to apply for the mortgage together, have one of you apply using your credit and income only, or wait a bit so you can both improve your credit.Milan Griffin, Chief Operations Officer of HomeFree-USA, shares more financial tips for couples who are planning to buy a home together.
