Money and relationships go hand in hand.  But while love may conquer all, issues surrounding money, debt and finances in general could cause serious problems in a relationship.

How are you handling money in your relationship? Studies have shown that finances are one of the leading causes of conflict in a relationship. Consequently, it has led to divorce.

So, to help you navigate through this significant aspect of your relationship, I’ve provided some recommendations on how to handle money in your relationship.  After all, you want to be able to successfully manage your money as a couple, just as you’re working to create a successful relationship.

Talk About Your Finances

Having a candid talk about money, debt and finances is crucial in a serious and long-term relationship. 

This is especially important if you and your partner are considering moving in together. It is equally important for newlyweds.

There are many factors that need to be addressed to ensure both of you are on the same financial page.

Prepare a list of the financial matters you would like to discuss so it can be a productive conversation.  You should know your partner’s income, debt, and spending habits. 

Talk frankly about the household expenses, who will pay for what, and each of your ideas on saving for unexpected expenses such as emergencies.   

While an initial money talk is important, it is equally important to have ongoing conversations about your finances. That way both of you are constantly aware of what is happening.

Circumstances change, your goals may change, and therefore you may need to take a different approach to handling your financial matters. 

Even though you may argue or disagree on some matters, it’s essential to remember that you’re having the discussion to avoid major financial disaster in the future.

Have Separate And Joint Accounts

You more than likely had a savings and/or checking account prior to entering into your relationship. 

Maintain at least one separate account.  You want to ensure that perhaps that $10,000 you worked so hard to save remains there to use as needed.

In addition, open a joint bank account for handling household expenses. 

By now you’ve had the discussion about how much each of you will be responsible for paying towards rent/mortgage, utility bills, etc. 

That way each person contributes accordingly to the joint account.  Use this account to save for vacations or to achieve your mutual financial goals. 

According to a TD Bank Survey, forty-two percent of couples with joint bank accounts also have individual bank accounts for various reasons.

Likewise, your partner may have accumulated credit card debt, student loans, owe child support or alimony payments. 

Your joint account may be subject to garnishment to cover these debts.  That would certainly cause tremendous tension between both of you.

Maintain Separate Debt

Avoid obtaining joint credit cards.  This will prevent creditors from garnishing your accounts if your partner fails to make payments for an extended period of time.

In other words, if the relationship ends, you are protected from your partner’s debt. Similarly, maintaining separate debt allows you to keep your own credit identity.

After all, it took you several years to build up that excellent credit score of 780, only to have it destroyed by your partner’s debt? That is sure to cause resentment towards your significant other.

Establish A Budget

Set aside some time when you are both relaxed and not stressed to create a budget for your household. 

Make a list of all your fixed and variable expenses.  Fixed expenses are rent/mortgage, car payments, utilities, cell phone bills, and student loans.

These are consistently due each month. Variable expenses include gas for your car, clothing, groceries and household goods such as cleaning supplies.  These costs vary per month.  

Have an honest talk about how to handle the matter of one person making substantially more than the other.  

In addition, there are apps like Mint that can help you track your expenses, see all your bills in one place, and essentially manage your finances from a single dashboard.  

As a couple you should determine exactly what works for you and your individual situation.  Most importantly, each of you should play a role in handling your finances.

Recognize Your Differences

You might be a “spender” and your partner the “saver” when it comes to finances. You enjoy buying lunch daily or eating out regularly, taking lavish vacations or purchasing expensive items. 

Your partner, on the other hand has mastered the art of saving by packing a daily lunch, being willing to only spend on vacation deals, and making frugal purchases.

The most important thing is to acknowledge these differences and work together to find a balance. 

To clarify, a spender could help a saver see the benefits of investing in once of a lifetime experiences.  By the same token, a saver may assist a spender in saving for long-term goals.

Communication and definitely your approach are two key factors in handling money in your relationship. Having an open and honest conversation about your finances will ultimately set the stage for a solid financial future together.