Last month we looked at the steps necessary to protect yourself financially in the event of a breakup or divorce. This month we will take a look at it from the other side: how you should be protecting yourself financially as you make new levels of commitment to your relationship to be legally and fiscally covered.
Talk it out
Nobody likes talking about money. It’s a societal taboo that we all try to avoid, but being upfront and honest about your personal finances is important before making any financial commitments to your partner.
Money topics that you should cover and ask your partner about include what assets you own, what you owe, if you have outstanding taxes, and what your financial goals (long term and short term) are. Both parties being upfront about this at the very start avoids surprises and arguments down the track.
They say that seeing is believing and this rings true with finances. Be open and honest with your partner and have them return the favour with you by not being secretive about bank statements, bills and wages.
You don’t have to give them full access to your financial accounts or make reporting back with financial documents a formality, but do openly discuss these things with your partner and don’t shield the documents from their view. It will make them think that you have something to hide if you are overly secretive.
Ask a professional
Before you make any large step like opening a joint credit card or co-signing a lease you should know the full legal and financial ramifications in any scenario. What would happen if you were left in a large amount of debt because your partner has abused the credit card? Or what would you face should you part ways and you are unable to pay the rent? Seek the advice for a professional so that you know exactly what is going on and you aren’t in the dark about your finances.
Always protect yourself
After following the above steps you could consider yourself protected and ready to take the leap into financial commitment with your other half. Remember that even if you and your partner have joint accounts and share incomes that it is healthy to have some money and savings that are just for you. Having an individual account gives you freedom within a relationship to keep your individuality.
Are you struggling with debts following a separation or looking to get debts in order before you and your partner make a financial commitment to each other? Life After Debt can help. Call us on 1300 237 669 or get in touch online.