Money Matters: Give Your Relationship A Healthy Bottom Line

It may sound surprising, but money is the number one reason that most couples fight. In addition, it is one of the leading causes of divorce, which is why every healthy relationship must address the issue of finances and how they can best work for you. More importantly, the time to address your finances is prior to a marriage and regardless of the size of your bank accounts.

If you are planning a wedding, then you may also be looking for a home to start your new life. Whether it be renting or purchasing, both your credit history and that of your spouse will affect your ability to obtain a loan or, in some cases, even a rental property. The best way to know where you stand is to get together and discuss credit history, current financial obligations and effectively work out a plan to eliminate as much debt as possible. It may be a wise idea for both you and your fiancé to get a copy of your credit reports and share them with one another. In addition to being the perfect time to correct any inaccuracies on your credit report, this will give both of you a good indication as to where you will stand when it comes to credit worthiness.

Once your credit reports are accurate and both you and your fiancé are fully aware of the other’s debt and credit history, you can determine how to approach the possibility of home ownership. Your FICO score, which is determined based on past payment history, debt to balance ratio and length of credit history, will have a large impact on the interest rates of a loan. If it isn’t feasible to obtain a home loan in the beginning of your marriage, you may be able to ask a financial advisor or loan officer how to better increase your ability in the near future. Buying a home will minimize your time spent renting and will allow you to begin building equity in your own home.

When it comes to combining finances, many couples struggle with whether or not to pool their money into a joint checking account or leave everything separate. If this sounds familiar, a good compromise may be a his, hers and theirs checking account. It’s perfectly fine to keep finances separate, but there should be one joint checking account for paying bills and other household expenses.

Depending on the area in which you reside, you may know the meaning of a community property state. This means that any debts incurred by either you or your spouse, regardless of whether they are incurred individually or jointly, will automatically be the responsibility of both. It’s important to communicate honestly with one another regarding any new credit accounts, debts and other obligations that occur within the marriage. When it comes to spending, both parties need to be on the same page where financial wellness is concerned. Quite often, a spender and a saver will have difficulty in balancing their budget, but it can be done if both are willing to work at it.

As a final thought to balancing your relationship and your checkbook, avoid the temptation of ignoring the issue of money. Although it may be one of the more unpleasant topics to discuss, it is necessary nonetheless and your relationship will have a healthier bottom line for having handled the issue through open discussions and honesty.

About the Author:
Alex is a consultant for a New York Company which runs an online gift shop offering wedding favors and wedding supplies.

Article Source: www.iSnare.com