Finance can be a confusing and intimidating subject, and that can increase when you throw romance into the mix. So it’s no small surprise that there are plenty of relationship money myths that have been bred in an attempt to make this sticky subject simpler and easier to understand.
However, when it comes to things as unique as your financial and romantic life, you shouldn’t rely on blanket statements and money myths. Here are some of them you should avoid, and what you should do instead to increase your financial success as a couple:
Money Myth 1: Talking about finance can ruin romance
Since we were little, we’ve been taught that it’s impolite to discuss money in social situations, and that’s truer than ever for romantic ones.
However, money issues are the leading cause of divorce, while openly talking about finance has been linked to happier marriages. So you should definitely realize that this is one of the money myths to avoid. Everything from retiring together to supporting children is easier to achieve with financial honesty and communication, and what’s more romantic than that?
Money Myth 2: You don’t need to plan for retirement if your spouse is
Another big money myth you need to ignore is that you can avoid retirement planning if your spouse is doing it.
As I’ve said before, women face a slew of unique retirement issues – for instance we tend to live longer and we earn less on average. So throw these money myths about retirement out the window – you can’t assume your spouse’s retirement fund will be enough.
Money Myth 3: Your accounts automatically combine after marriage
Although marriage is indeed a union, the notion that your finances automatically combine is another one of the harmful money myths. You’ll still each have your own savings accounts, and you won’t automatically know what your partner is spending/saving after entering into a relationship.
Being left in the dark financially as a partner can lead to some major problems, such as financial infidelity and secret debt. Although you don’t have to combine all your wealth into a joint account after getting together, couples need to be transparent and aware of each other’s accounts as soon as possible.
There’s no one-size-fits all solution, but many couples find it helpful to create a joint account for big-picture spending (like rent), and to also use individual accounts for day-to-day spending. The key here is that you’re both aware of your accounts and how decisions with them align with your long-term financial goals as a couple.
Money Myth 4: Your credit scores combine after marriage
Another one of the harmful money myths often rears its ugly head when couples apply for financing together, such as a mortgage. Just like your individual accounts, your credit scores don’t automatically combine in marriage. When it comes to major financing, lenders usually take into account both your scores, so its vital that your both aware of each other’s scores, and that you take steps to correct them before they’re necessary.
Do you know of any other money myths that couples should avoid? Share them with on Twitter!
To learn more about investing, check out my firm LexION Capital’s website.