According to the Australian Bureau of Statistics (ABS), in 2019 there were 113,815 marriages. Sadly in the same year there were 2,162 divorces, with financial issues cited as one of the major reasons for marriage breakdown.

For couples deciding to move in together, the idea of buying a home and building a future can be very exciting, and prompt a lot of discussion.

Conversations around shared finances and where one another stands on money – in particular, financial goals and obligations – don’t seem to generate the same enthusiasm in a marriage.

Nevertheless, these are the discussions that need to take place as they can impact everything from where you live, to children, schools and lifestyle.

For example, what if you tended to use credit to buy the things you wanted, while your partner was debt-averse and preferred to save up? How would conversations around buying household items go?

Additionally, existing debt has the potential to cause considerable problems in relationships; nobody likes financial surprises.

When Chris a restauranteur, and Noel a marketing manager, decided to buy a home together, they were so compatible that they agreed on location, style and even budget without the need for any serious discussion.

Imagine their surprise when their joint application for a mortgage was declined.

Turns out, that several years ago Chris had taken a business loan to buy the restaurant. The business had undergone some teething problems and as a result Chris’s credit score had been impacted.

Noel’s income alone was not sufficient to cover the mortgage so the couple was unable to buy their dream home.

The resulting disappointment and arguments could have been avoided had they discussed their debts and financial arrangements.

Discussion points to consider

Similarly, consider other financial discussions around:

  • Credit card debt;
  • Car and investment loans;
  • Child support and other prior-relationship obligations.
  • According to the government’s MoneySmart website, when your relationship is getting serious, it’s a good idea to start having those chats. You know, the ones about:
  • Bank accounts: Joint, separate or a combination,
  • Children and schools, private, public, university etc.;
  • Life and Health Insurance;
  • Investment risk tolerance;
  • Lifestyle: House, holidays, entertainment;
  • Retirement planning: Will you spend now and save later or vice-versa;
  • Borrowing to invest: Property, share portfolios etc.

Establishing agreed financial goals around these subjects early can set expectation and facilitate strategic financial planning in the marriage.

But what if you have different goals?

Couples unable to agree, or misunderstanding one another’s goals, may encounter difficulties down the track when decisions need to be made. Communication is key in relationships but if talking about money is difficult, start by setting a budget based on income and expenses – and honesty.

How to seek professional support

If these discussions feel too uncomfortable, the Australian government offers an assistance service. Contact the National Debt Helpline on 1800 007 007 to speak with a financial counsellor. Additional services are available for small business owners, farmers or people in regional areas.

Alternatively, kick off those discussions by introducing your partner to get in touch with me. You don’t have to have the same goals, but by creating a plan that suits everyone’s needs, you’re off to a good start.

This article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information.