Money can be a potential source of conflict for couples who live together. So while it might not be romantic, it's important you agree how to manage your joint finances with your partner before you move in together. The CCPC is here to help.
So, you’ve decided to take the big step and move in together. Congratulations! It’s a new year and you’re full of excitement looking forward to your new life together. But money can be a potential source of conflict for couples who live together. So while it might not be romantic, it’s important you agree how to manage your joint finances with your partner before you move in together. Ignoring money issues can put stress on your relationship, and as with any relationship issue, communication is key!
Do you have different attitudes to money?
It’s important that you discuss any differences you have and figure out how to manage your money. For example are you a spender and your partner a saver? You should discuss each other’s financial habits. Having regular, open conversations about money is going to be helpful in understanding both of your attitudes and will help avoid any hidden resentments building up if you have different views.
How will you manage your day-to-day expenses?
Agree how to pay for your shared expenses, such as your rent and bills. Take into account each other’s income. The key is to come up with an arrangement that is fair to both of you. For example, think about how best to share expenses if one of you earns more than the other. Also, discuss how you will keep track of your joint finances, and who has responsibility for what. A joint account might work best for your shared expenses and you can still have separate accounts for your own money.
The budget planner on the CCPC’s consumer website consumerhelp.ie can help to get you started on planning your household budget. It will help you work out what income you have available and what changes you may need to make to take account of your new living arrangements. It’s important that both of you understand how much you can afford to spend so that you don’t end up overspending.
What are your long-term savings goals?
Discuss your savings goals. For example, you may want to save for a house deposit or for a wedding or even just a holiday. Consider the impact certain decisions may have on other goals. For example, if you want to save for a deposit on a house can you afford to do this while paying your current rent?
You may also want to consider setting up a joint savings account and pooling your savings, which may give you better a better return than having individual accounts.
How would you manage if something unexpected happened?
Think about how you would cope if one of you were to unable to work or if you needed money for some other unforeseen event. One option is to set up an ‘emergency fund.’ Aim to build up at least three months’ salary. There are other types of insurance products such as income protection or mortgage repayment protection which can help you prepare for the unexpected.
What’s the plan if things don’t work out?
It is also important to have some kind of plan in place for what to do if you break up while living together. Who gets the furniture? Or who gets the pet if you have one? Make sure that you both have a clear understanding as to who owns what. Ideally, write it down. That way, you can avoid extra conflict if that unfortunate event does happen.
The Competition and Consumer Protection Commission (CCPC) has lots of tools and information on its consumer site, www.consumerhelp.ie, if you are moving in with a partner.
The CCPC is responsible for enforcing competition and consumer protection laws across the economy. To help consumers make informed decisions it also gives independent, unbiased information about consumer rights and personal finance products and service through its consumer helpline 1890 432 432 and consumer website www.consumerhelp.ie.