Is your relationship passing from the serious to having made the decision to live together? Have you thought about how you will manage your money and how you will share expenses? It is important that one of the things you discuss before moving in together is money management. You need to understand each other’s approach and attitude to money.
So you decide to combine all your income and that of your partner into a single pot and use this for all your expenses – from everyday small things to paying the mortgage. The pluses are that this makes budgeting easier to manage, and both of you whave control over the money and see what your partner is spending. To achieve this you both would need to open a joint account.
So far so good. Before you do so, however, here are some thoughts you should consider:
Unlike jurisdictions overseas, your or your partner’s credit worthiness is not made available to you by your respective banks. Be that as it may, the banks do keep note of your credit worthiness – and will on the basis of that credit worthiness make decisions in your regard to loans, etc. So whilst it may not be possible to obtain the credit note of your partner, take note of your partner’s attitude to money during his/her relationship with you: were his/her credit card bills always paid on time, did your partner spend lavishly or not spend at all, did your partner occasionally ask you to lend him/her money to him/her through to payday?
Keep in mind that as soo you open a joint bank account your credit rating may be affected.
Once you open a bank account keep in mind that you will be responsible for arising debts, late payments, etc. Before you make the decision to have a joint account, you need to make sure that you trust your partner. A partner who has an irresponsible attitude to money may lead you to major money issues with your bank. Make sure you have similar spending patterns, habits and behaviours – otherwise you will disagree and start arguing about money.
Particularly at the outset you may only start to get to know each other’s true attitude to money management. Lack of rules of money management may result in considerable tension and arguments between you. You make sure that you both have the same understanding with regard to joint money responsibility. This means agreeing to what each of you will save, that the accounts is managed by both, what you can and cannot afford, the spending threshold between you, the minimum balance to roll over at the end of each month, etc. The same stands vis-à-vis of debt that will be accrued by either of you on the account’s credit card.
It is important to know exactly what is happening with your money as a couple, so discuss your finances with your partner regularly and openly. This will help you both stay involved with household finances, manage your money responsibly and deal with any issues together.