Have you just moved in with your better half or recently purchased a property together? It's time to talk money! It's well known that money is a taboo topic that can lead to conflict within a couple. Should you manage your money together or separately? How do you plan for the separation of property if you break up? These are just some of the questions you need to discuss with your loved one. Here are seven tips for starting off your life together on the right financial footing, because good accounting makes for good friendships and love stories too!
Talking about money is a priority when you share your life with someone you love. You should not hesitate to disclose your salary to your partner so you can establish a specific budget. When a relationship becomes serious and a couple starts to pay bills or buy property together, discussing financial matters is both inevitable and necessary.
Asking the right questions is the starting point for your discussion. Do you have projects in common for the future? Do you have personal objectives that concern only you? Make a list of your shared financial goals, including retirement projects and the ways to carry them out, but keep it real and be honest with each other.
List your combined incomes as well as your shared expenses. It's the best way to figure out where your money is going and establish effective ways to save as a couple.
There are as many ways to manage money together as there are couples. Each one has its benefits and drawbacks:
While each method has its benefits and drawbacks, the share everything approach simplifies the payment of shared bills and makes it easier to manage the family account. In addition, it lets you know how much money you have on hand to cover any contingencies.
If you haven't married and don't expect to, you should know that in Quebec, common-law couples don't enjoy the same legal protections as married couples. For example, common-law spouses are not entitled to alimony payments nor any inheritance in the event of their partner's death. A will or a cohabitation contract is therefore essential to protect yourself in the event of a dispute, death, or separation. Remember that it is much easier to discuss the division of property when your relationship is running smoothly.
Even if you decide to have a joint account for your expenses as a couple, such as bills for your children or house, it may be a good idea to keep a personal account as well. This way, you won't have to justify expenses that concern you alone and which your partner may not necessarily agree to if it was his or her own money. Also, should one of you die, any joint accounts will be frozen for a certain period. A personal account can be a lifesaver in the meantime.
While the topic is an unpleasant one, you should be able to discuss the financial measures you'll need to take if you separate or if one of you dies. Who keeps the house and how you'll share the property are some of the issues to be considered. This is also the time to confirm whether your insurance covers the other partner in the event of death or disability.
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