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  • Writer's pictureMatthew Carberry

Finding your financial soul mate

You’ve met your match – but are you a good financial fit? Here’s how to find out.

When it comes to a couple’s spending and investing styles, sometimes opposites attract. While we’re often drawn to a romantic partner whose personality type complements ours, differing values around money can be a cause for major conflict. In fact, research shows that disagreements about money are a major cause of divorce(1). Despite this, only around one in three Australians discuss their financial situation before making a commitment with their partner(2). And it’s not just established couples that argue over opposing financial styles – conflicting money habits can raise alarm bells in couples who’ve just started dating as well.

Understanding your financial values

Before you assess your partner’s financial values, it’s important to take a look at your own. You can start by asking yourself some key questions, such as: • How did your parents treat money? • What are your short and long-term financial goals? • What are your financial worries?

It may not seem romantic to think of a partner in terms of how they align with your financial values. However, this will be a major factor in the long-term success of your relationship – so don’t let butterflies in your stomach blind you to red flags such as irresponsible spending, declined credit cards, or asking to borrow money.

Paying yourself first

When you’re in a committed relationship, it’s normal to share at least some finances, like a joint bank account or mortgage. But it’s a good idea to maintain some financial independence as well. That way, if the relationship ends or your partner experiences financial problems, you have your own financial resources to fall back on. The golden rule to building up your savings is to “pay yourself first,” rather than saving whatever is left over after spending. But by putting aside a set amount from each pay, you’ll be surprised how quickly your savings grow – with a direct debit this can be automatically deposited into a separate account.

Dating someone with debt

Debt is not necessarily a deal-breaker in a relationship. First, it’s worth finding out how your partner got into this situation – there is a world of difference between taking out student loans and gambling. If their spending got them into debt, you want to know that they’ve changed this behaviour and are now living within their means. You can encourage them to make better financial decisions without putting your own financial security at risk – for example, don’t sign a loan to help them pay off a credit card.

But be realistic: if your partner is not taking active measures to eliminate debt, you need to think about what this means for future joint financial decisions, such as buying a home together.

Starting the money conversation

Whether you’ve been with your partner for six months or six years, communication around money is key. It helps for both parties to prepare a list of specific questions and concerns they have for the other – and to end the discussion with actionable tasks for each partner. When discussing debts and spending, try not to be judgmental – and be willing to admit faults on your side. You also don’t want to create an argument, so you might put a “time out” rule in place if the discussion becomes too heated. And remember, personal finances should be an ongoing conversation, not a once-off.

Your financial situation and goals will continue to evolve, so it’s best to set aside a regular time to talk about money.

Managing conflicting goals

Once you’re sharing a life with another person, you may discover that you have different ideas about the future. Compromise may be required to achieve your individual goals and set new ones together. Remember, it helps to be on the same page if you have clear goals with a specific timeline. You can manage conflicting goals by prioritising your spending – you and your partner might draw up a list of expenses and work out which you would be willing to change or sacrifice. By comparing the lists, you can create a joint budget that puts you both on track to reaching your targets.

Get the right advice Sometimes relationships can use a little help to stay on track. For support and guidance with your combined financial future, speak to a Verve Group financial adviser.

Learn more about our Financial Planning services or book your free initial consultation with a Verve Group Adviser by calling (08) 8120 4877 or book your appointment online.

1 Relationships Australia, Impact of financial problems on relationships, August 2015.

2 Relationships Australia, Finances and Relationships, January 2019.

This document contains general advice. It does not take account of your objectives, financial situation or needs. You should consider talking to a Financial Adviser before making a financial decision. This document has been prepared by Count Financial Limited ABN 19 001 974 625, AFSL 227232, (Count) a wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. ‘Count’ and Count Wealth Accountants® are trading names of Count. Count Financial Advisers are authorised representatives of Count. Information in this document is based on current regulatory requirements and laws, as at 15 April 2019, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Count, its related entities, agents and employees for any loss arising from reliance on this document.

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