Lets be real, even before you decide to get married you and your significant other sat down at some point and talked about your future. Many times these conversations include “I’ll have a big house, two kids” or “maybe a great salary and a pool”. Conversations like these are probably a good reason to why you should discuss your future finances, its all in the same package. Sometimes even things you may not even think are finance related, have deep financial ramifications.
Since these ramifications exist I want to share some questions that you might share with your significant other and at the same time start creating some good habits to talk about your current finances and learn to plan. A responsible adult shouldn’t have a YOLO mentality when it comes to money.
1 – How many children will you have? Who knows, you probably already made this decision, but make sure you confirm with each other what the plan will be. Don’t wait until the last moment to consider your priorities. Don’t let financial uncertainty decide how many children you’ll have and instead let the number of children you plan to have guide your financial future.
2 – Will you own a home? Consider what type of house you’d like to have, the neighborhood, the city. Every single detail entails a certain cost, and if you talk about how much you’ll spend on your home you will surely be ready when the day comes to move to a new house or get out of the apartment.
3 – Will any of you pursue higher education? Who knows, you might be 30, 40, maybe 50 years old and still thinking about finishing college or going to school for a degree. Spend some time talking about it, consider options and create a valid action plan. Both should consider each others goals and vision.
4 – If you plan to have kids (or already have them), will someone stay home with them when they’re young? Career considerations are a major variable when talking about finances. Be open-minded when talking about these situation. Not everyone wants to be a stay at home mom/dad, and maybe both of you want good careers and have to consider someone to watch the kids while you work.
5 – What do you think about “debt” in general? Some people think debt is a sin; no joke. Are you want of them? Do you know if your significant other is one of them? Talk about it, and remember to be open-minded. The fact that someone doesn’t want to get into a $5,000.00 loan and you do doesn’t mean they want to live a boring life. Similarly the fact that your significant other wants to get a $5000.00 loan doesn’t mean that person’s going to make you broke. Consider options and help one another with the budgets so that each lifestyle go hand to hand with what your family vision is.
6 – Will you pay for your children’s education? – College is expensive, some couples simply don’t have enough to pay for their kids college, others simply don’t pay for it to have their kids work for the knowledge. Regardless of your ideals (I for one think the parent’s should at least consider and help their kids with their studies) it’s very important to consider these things early in the relationship to avoid any hardships later-on.
7 – Cars. – The average new car runs by a starting cost of around $10,000.00. Two of those is a big expense. Do you want it new or used? A truck or a hybrid? I actually recommend you start an early car fund instead of waiting for these decisions. You can easily set aside the “would be” monthly payment a year or two before buying a car and get it used. The car that’s new this year is 2 years old in 2 years… go figure (this means it’ll be cheaper, and probably still in warranty and has low insurance costs PLUS you’ll probably have half the cost already saved up).
8 – How often will you go on vacations? Normally, vacation now days are simply to fill your Facebook with photos and memories. It’s great to enjoy life, it’s even greater to enjoy it with people you love. But how often are you planning on doing that? A cheap vacation a year can easily rack up to $3500.00 and that’s using my family discount at discounttravelbooking.com. Be sure you consider how vacation costs will change when the kids arrive (or leave to college). Do not forget your dive watches when going vacation.
9 – The When, Where, How of Retirement – You probably think I’m crazy for bringing this up, but bottom line is that people should start planning for their retirement as soon as they have a stable job. Do you know how your retirement will look like? Do you have a plan? Talk about what’s important for both of you.
Financial talk is sometimes stressing (or chaotic.) if not done in a precise moment, but don’t just avoid talking about it because it’s a strong topic. The fact that it’s hard to talk about should show you how important it is. Sit down, put something on Netflix and calmly talk, discuss and disagree in peace. If you can both listen where the other is coming from on every topic it’ll be easier to reach mutual agreements on your future finances.