Hard to talk about money with your spouse! As a result, all too often we make decisions as important as moving together, getting married, or taking a break from work without knowing the financial consequences. Here are five tips to keep in mind to avoid disappointment:
1 – Talk about money without waiting
If love has nothing financial, money plays an undeniable role in love. “Getting into a relationship with a broken basket or chronic indebtedness will affect the choice of home or house, the type of vacation, the frequency of excursions, in short, the quality of life,” we read in the book. . Moreover, the difference in credit score for the two partners is statistically inversely proportional to the duration of the romantic relationship. Find out your new spouse’s income, assets and liabilities from the start, to avoid unpleasant surprises later. Maybe even from the beginning dated!
2 – Distribute the costs fairly
How do you calculate each spouse’s contribution when there is a significant income difference? In the case where the first wins $ 50,000 and the second $ 100,000, many will decide to opt for a one-third-two-thirds split. However, disposable income, after tax, pension payments and any supplements must be taken into account. The question is even more complex once one has had a past life. The authors take the example of Isabelle, who alone takes care of her two children with an annual salary of $ 40,000. By moving in with her boyfriend, who earns $ 60,000 a year, she loses more than $ 11,000 without tax annually due to the drop in social tax assistance. How will spouses share savings and losses in their life choices?
3 – Set common life goals
What do you want with your financial resources? Are you frustrated with your spouse’s reckless consumption or his recklessness about retirement? According to the authors, it is essential to establish a common economic ideal. Depending on your age, you can, for example, make a plan for repayment of student debt, set RESP targets for children or even prepare pension plans with annual savings targets. According to the Royal Bank, by 2020, no less than 85% of Canadians in long-term relationships attribute the health of their relationship to having the same habits and economic goals. What if it’s time to talk about it with your life partner?
4 – Stop seeing marriage (only) as proof of love
Romantic souls abstain! For Pierre-Yves McSween, “marriage is the most clothed legal contract in history”. In Quebec, it comes with the composition of a family inheritance, the value of which is divided half and half between the spouses at the time of a possible separation. Married or civil couples are also subject to one of the three applicable marriage schemes, which determine how other assets are managed. Imagine that you have chosen a marriage contract with property separation and that you have a total of $ 80,000 in RRSPs while Mr. has invested in his business. In the event of divorce, you must pay him 50% of your assets, without getting anything back, as the company belongs to him. If you are getting married this summer, consider making an appointment with a lawyer!
5 – Maintain economic autonomy
Maintaining the ability to say “no” is the best way to protect yourself from financial abuse, defined as the abuse of financial power in a relationship. Having a bank account in your name, keeping an active credit portfolio, maintaining a market value in the job market or being able to easily consult the couple’s financial data are all tools that allow you to maintain control over your financial life. If you stop working to take care of your young children for a few years, clearly agree current and future financial rules with your partner for the sake of justice. Otherwise, you could become financially dependent on your spouse and unknowingly build your own financial prison.
Failure to live by love and fresh water gives a better understanding of the couple’s financial efforts the opportunity to preserve their freedom and give themselves the means to live a happier life!