Get Financially Naked: How to Talk Money with Your Honey
When you make the decision to spend your life with someone, you often share your dreams and aspirations with one another. You talk about children and where you might travel one day. You discuss your thoughts on politics and the ideas that you have for a home you want to build. What you may neglect to talk about are the financial details that make that all come together seamlessly. Often, couples don't start talking about money until they hit a road bump, which is less than ideal.
With this in mind, we had a chat with financial expert Manisha Thakor to get her thoughts and tips on the topic of talking money with your honey, because we think the health of your relationship depends on it.
“If you tackle that discussion head-on,” she says, “at the beginning of your relationship, it can actually bring you closer together.”
So, why is having they money discussion important for those who are just starting out as a couple – either married or simply with combined finances and home responsibilities? Manisha says, “Simply put, money can drive a wedge between a couple if left undiscussed.” She made such a fantastic point that many couples discuss how they are compatible in the emotional and spiritual sense, they discuss their interests and whether they would like to have children, but they forget to discuss their financial goals and priorities. They forget to get to know how the other person views money, spends money, and saves money. Having that discussion about how they see their financial future is important. “If you tackle that discussion head-on,” she says, “at the beginning of your relationship, it can actually bring you closer together.”
WHAT ARE SOME OF THE SPECIFIC FINANCIAL ISSUES COUPLES SHOULD TALK ABOUT?
There are 5 things every couple should start off discussing to get off on the right foot financially as a couple:
The Logistics: Do you want separate or joint accounts? Who's paying the bills and how will you talk about that? What's your net worth together? What do you own, is it growing over time (hopefully it will!)? These are important discussions and each answer is unique to each couple.
As someone who's been married for over ten years, trust me when I tell you that these conversations are key to your marital peace and sanity.
Budget: What is coming in and going out? Choose a simple , free program – Mint.com is one example and an industry leader. Others are hellowallet.com or movein.com – you use their debit card and set a budget for your spending on certain items and it will give you a real time update that you're about to get to that limit.
Savings and Investments: What does your retirement plan look like? This includes your IRA, 529 college for kids, etc.
Debt: How much is there and how are you handling it? Include credit cards, car loans, student loans – and a game plan for paying it off.
Insurance Needs and Coverage (as a couple and as a family): Will you secure life insurance? Will you have the same or will one spouse have more than the other due to being the primary income earner?
WHAT ARE THE BASIC TYPES OF INSURANCE COVERAGE THAT NEWLYWEDS SHOULD HAVE?
You should be thinking and talking about all of the above. When it comes to auto insurance, while most plans require the household to be under one plan, there are some that allow separate depending on your circumstances. Home insurance is vital for unforeseen circumstances and disasters. Life insurance is extremely affordable, especially at a young age, and will leave your family and loved ones with assistance should you pass unexpectedly. There are different plans – term or life – depending on what you decide as a couple works best for you.
In regards to your health insurance, go through the ins and outs of both plans if you and your spouse have coverage options through an employer. Determine how they both work, look at the co-pays and how they meet your individual health needs. Based on that information, decide if you should both be on one plan or stick with your respective individual plans.
Manisha recommends InsureUonline.org for a fun Insurance Survivors Guide for Newlyweds and an I Do Adventures Game which helps get your financial and insurance conversations flowing.
As someone who's been married for over ten years, trust me when I tell you that these conversations are key to your marital peace and sanity. You both feel more secure, happy, and content when you have a handle on all aspects of your finances. Take the time to get to know one another in this regard, you will be happier in the long run. Communication is truly key for financial happiness as a couple.
Have you had these discussions with your significant other? Which topics do you still need to discuss?
To hear the whole interview on the topic of Talking Money with Your Honey check out:
Manisha Thakor is the Founder and CEO of MoneyZen Wealth Management, a boutique advisory firm providing integrated financial planning and investment management for clients with portfolios ranging from $1 million to $25+ million.
After years working in the traditionally male-dominated world of financial services, Manisha wanted to create a firm where high net worth women and families can receive clear, concise, compassionate financial advice to support their life goals. The cornerstone of her work is something she calls “MoneyZen®,” a joy-based approach to personal finance honoring the core values of simplicity, freedom, and abundance.
Manisha is also the co-author of two personal finance books for women: ON MY OWN TWO FEET and GET FINANCIALLY NAKED, serves as Financial Fellow at Wellesley College, and her MoneyZen writings appear in The Huffington Post. A frequent commentator on issues of financial literacy, Manisha’s work has been featured in many media outlets including CNN, CNBC, PBS, The Wall Street Journal, Real Simple, and MORE.
She sits on the National Board of the Girl Scouts of the USA and on the Advisory Boards of Feminist.com and The Oped Project.
Prior to setting up her own firm, Manisha spent 15 years working as an analyst, portfolio manager and client relations executive at SG Warburg, Atalanta/ Sosnoff Capital, Fayez Sarofim & Co., and Sands Capital Management.
Manisha earned her MBA from Harvard Business School, her BA from Wellesley College and is a CFA charterholder. She lives in Santa Fe, NM with her husband. Her website is MoneyZen.com.