Coming Clean

Now it’s time to ‘fess up. Yup. If you’ve been putting it off, you can do so no longer. If you aren’t prepared to talk about your money, about the mistakes that you’ve made, about your successes, about your dreams for the future and your hopes for your life together, then call it off NOW!

Still getting married? Okay, gather up all your financial papers, grab a pad or notebook, pencils, a calculator and some file folders. As you do this, you might as well get your money organized, if you haven’t already done so. (Gail’s 12 Steps to Getting Financially Organized.)


What You Have
Get out your latest statements (or if you’re planning to do this, save your next statements) for your:

  • chequing account(s)
  • savings account(s)
  • investments (GICs, term deposits, mutual funds, brokerage account)
  • pension (corporate, RRSP)
  • equity in your home (the value of the property less the mortgage amount)
  • ownership in a business
  • any other property you may have an interest in (like a family cottage)

If you’re just starting out financially, you may only have one or two pieces of paper to work with. Lucky you. If you’ve already established yourself financially, you may have scads of paper.

List the financial institution(s) and your balance(s) for each of the statements you’ve gathered.


What You Owe
Now it’s time to look at your debt, if you have any. Gather up your most recent statements for your:

  • credit cards, including store cards and gas cards
  • line(s) of credit
  • loans, including car loans, student loans
  • mortgage
  • buy-now-pay-later purchases
  • pay advance loans
  • taxes (your last year’s tax return)

Again, list each company to whom you owe money, your balances, and the interest rate you’re paying. If you have an account that’s in overdraft, you’d put the overdraft amount on this list.


Other Financial Stuff
Next, make a note of the following:

  • How much do you earn gross and net? What benefits do you have where you work? Whose job will take priority (if, for example, you have to move for a career opportunity)?
  • Do you own a car (or other vehicle)? How old is it? When will you likely need to replace it?
  • If you didn’t do it before because you didn’t owe the tax man any money, find a copy of last year’s tax return now.
  • Do you have any insurance (through work, or that you bought)? Who is it with? What’s it for (life, disability, medical, critical illness)? What’s the insurance benefit? Who is the beneficiary? Will you be changing the beneficiary once you marry?
  • Do you have a will and powers of attorney? (Once you wed you have to remake your will if you already have one.)
  • Get a copy of your credit report so you can see how you look to lenders. (How to read a credit report.) The worse your credit history, the more you’ll pay in interest since you’re a higher credit risk.
  • How will we deal with interruptions in our income as they come (which they, undoubtedly will)? For example, if one of us loses a job? When we have children? If a family-member becomes ill? If we decide to continue our education?
  • What other financial responsibilities do we each have (i.e., commitment to support a family member, child support or spousal support, aging parents, needy siblings and the like)?

Now that you’ve each sketched a picture on paper of your financial realities, it’s time to talk.

One of the first questions you’ll want to address is this: “Will we pay off debt before we get married?” If yes, then you have to make a plan for your debt repayment.

Decide how long you have till you’re getting married and then divide the amount you owe by the number of months until you tie the knot. It’s not perfect, but it’ll give you a good idea of how much you’ll have to shell out to dig yourself out of the hole before you plunge into wedlock.

If you decide to tackle the debt together once you’re married, how? Will it come from your current joint cash flow? Will one or both of you get a second job to pay down the debt?

Don’t even think about having kids until you’ve paid off all your consumer debt. Since one or both of you will likely want to spend time at home with your Mini-me, you’ll have less income to live on. Maternity or parental leave isn’t a right. It’s a privilege. And one you exercise only if you can afford it. You won’t be able to make ends meet on less income if you’re still repaying stupid debt.

If one of you has a crappy credit history, what will (s)he do to fix it so when the time comes to buy a home (or a new car), there are no surprises? And no whopping interest cost.

If one of you is an on-again-off-again money manager, remember that if you have a joint account, any missteps going through that account will be reported on both your credit histories.

While money is the number-one way to mess up a perfectly good relationship, I have met couples for whom relationship issues lead to money problems. While you’re in questioning mode, why don’t you answer the following 12 questions too?

  • How are we going to divide up the household chores?
  • How much time will we spend at work, at home together, doing our own thing?
  • What are our expectations about how we will spend our free time?
  • Do you believe that we should be doing everything together?
  • What role will religion/spirituality play in our lives together?
  • Can we each pursue our own interests?
  • Do you need time alone?
  • What role will our families and friends play in our lives?
  • What’s your philosophy on having/raising children?
  • How will having a child change the way we live?
  • How would you feel if I want a night out with my friends?
  • How will we make sure we have quality time together?

Now that you’ve come clean, you should be ready to move forward together without too many big surprises.

Marriage requires constant attention. Just when you think everything is going smoothly, your significant other will say or do something that takes your breath away. Know, also, that no matter how well paired you seem at first, as time goes by and you each change, you won’t be the person you were when you married and neither will (s)he. Give each other room, and revisit the questions you sense may have different answers. For while it may feel safer ignoring your differences, that’s a fool’s game. So communicate, don’t disintegrate.

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