coffee cups

Till debt us do part?

Looking for a healthy approach to finances with your better half? Find out why two heads really can be better than one…

Do you remember the first time you did a weekly shop together with your partner? Perhaps you found out about their penchant for piccalilli? Or maybe they discovered your hidden love of tinned tomato soup? Finding little things out about each other comes hand in hand with being in a relationship. But how well do you know each other, financially speaking?

There’s no hard and fast rule for how to manage your money. However, there are some key things worth considering and discussing together. Let’s take a look at the financial benefits and some of the pitfalls of co-habiting as a couple… (the other benefits, we’ll leave for you to decide!)

couple on sofa

The good

Being in a relationship can minimise spending on everything from co-habiting and saving on utility bills and mortgages, right through to food shopping and gym memberships. Look at your living expenses together, so you can plan accordingly to make sure any shared expenses are allocated in the right place.

The bad

There are also some obvious expenses that go with being in a couple – spending more money on eating out, making big purchases such as holidays or a home, and perhaps getting married and having children. But more specifically, when you’re living as a couple you do take on some financial responsibility for each other.

Credit history

If your partner has a poor credit history, it won’t affect your own credit score but you may run into difficulty when applying for a loan or mortgage together. Stick to your own bank accounts rather than joint bank accounts, bills and loans until you and your partner can work on polishing up their credit rating, and use a free credit check site such as Experian* or Noddle* to keep an eye on your score.

Joint debt

Many relationships take the route of setting up joint loans, mortgages or credit cards. It may mean you can borrow more between you, rather than singularly, however, you need to be mindful that you could be liable for the full amount of debt. Even if your partner isn’t able to pay their share, any joint debt means joint responsibility. So, talk through your options fully so you understand and plan your repayments.

… and the ugly

We say ugly, but we don’t mean it. For better, for worse and all that – you wouldn’t change a thing about your partner, would you - expensive hair appointments, new shoes, costly hobbies and nights out with their friends included?

Take a look at what you both enjoy and couldn’t fathom living without and see whether it’s realistic for you to manage your finances accordingly. Once you’ve talked things over together, chances are the mutual benefits of managing your money carefully will become clear – whether that means you can book a luxury holiday together or make plans to install a new kitchen.

Making your money work harder

There are also some practical ways to make your money work harder as a couple and ensure that neither of you falls out of pocket. Here’s a few tips to get you started:

  • Look into other discounts that are out there – from rail cards to holidays, lots of companies offer discounts that are exclusive to couples.
  • If you’re married and one of you is not working or earning less than a certain amount, you could be entitled to tax breaks during the financial year. For up-to-date information, keep an eye on the* website.
  • Look into combining your assets – it’s easier to keep track of your incomes and outgoings, and you may earn more interest on savings.
  • Start thinking and talking about your future now so that you can prioritise your spending and save for your short- and long-term goals.

Pros and cons aside, the most crucial thing is to discuss your finances regularly so that you can make joint decisions about what works best for you. Two heads are most certainly better than one when it comes to your finances, and understanding each other’s financial needs and goals can make sure that you are in it together.

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