Relationships and money

Love and money

love heart made of coinsAre you moving in with someone, opening a joint account, or starting a joint loan or investment? It pays to go into love and money matters with your eyes open.

Here are some tips on managing finances with your partner.

Talk to your partner about money

Talking to your partner about money is important, whether you have similar or different spending and saving styles.

Here are four crucial issues to discuss:

  • Relationship goals: Work out your relationship goals with your partner. Consider what goals you share: is marriage, buying a home or having a baby on the horizon?
  • Current financial situation: Take stock of your income and expenses, assets and debts and your credit rating. Think about ways you can cut expenses to reduce your debts and save for your goals.
  • Attitudes to spending and saving: Are you a spender or saver? What about your partner? Your background and experiences will influence how you think about money. Understanding how your partner approaches financial matters will make it easier to create a money plan that suits you both. 
  • The financial controller: Who will handle the finances? Will one person look after household expenses, mortgage and savings, or will you share the responsibility? Make sure you're both happy with the decision.

Video: Tips for having money conversations

Talking to your partner about money

Sarah Moran and Jane Caro share their experiences and tips on how to talk to your partner about money, as part of ASIC's MoneySmart Women talk money video series.

Take action together

If you're serious about sharing your finances, here are some things to consider:

Use both names

  • Put both of your names on services like electricity and gas. This will make you equally responsible.
  • Putting joint assets and liabilities, like your home and the  corresponding loan, in both names means you will both have an ownership interest in the asset and both be responsible for the debt.
  • Think twice before putting your name on a loan that will only benefit your partner. See loans involving family and friends  and joint accounts for more details.

Smart tip

Don't sign anything you don't understand. Always read documents thoroughly.

Share costs

  • If you have private health insurance, it could be cheaper to share a couples plan than pay for two singles plans.
  • Insurers will often give family discounts on multiple policies, such as for car insurance, so shop around to see if you can get a better deal by using the same insurer for several policies.

Plan for a shared future

  • Get organised by making a list of all your accounts, loans, investments and insurance. Keep all your financial information in one place so you both know where it is.
  • Work together on a household budget. This will help both of you see how much money you can spend and how much you can save or invest in your shared goals.
  • If you are married or in a de facto relationship you may be able to split off some of your super contributions to your spouse. This may be beneficial for your retirement plans. If you have a non-working spouse, you may also be able to claim a tax offset for after tax spouse contributions.
  • Make a will and keep it up to date. See our wills and powers of attorney page for more information.

If you earn less income than your partner, you may feel you don't have a right to make decisions about where the money goes. Talk to your partner about how you feel. You should work as a partnership, including when it comes to money.

Know the facts about sharing money

Don't be blinded by love - be aware of how much money is coming in and going out. Here are some facts you may not be aware of:

  • A joint loan doesn't mean you're only liable for half the debt. If your partner defaults, you may be liable for the whole amount, including fees, interest and charges, even if your relationship ends.
  • If a utility service such as electricity or gas is only in your name, then it's your sole responsibility to pay the bills.
  • Think carefully before you guarantee a loan for your partner or family members. If things don't go to plan and the borrower can't repay the money, you could be asked to repay any loan you've guaranteed, including fees, interest and charges. For example, if the guarantee is secured against your home you could risk losing the home. Visit our webage on loans involving family & friends for more information.
  • Ignorance is not a defence. Signing papers you know nothing about, just because your partner told you to, does not make you any less liable for any loans or guarantees you may have agreed to.

Shared credit cards

If you are thinking about sharing a credit card with your partner, make sure you understand the different types of accounts available.

Joint credit cards

A joint credit card is held in both names. The bank will consider the incomes and credit histories of you and your partner when you apply for a joint credit card, and you will be equally liable for repaying what's owed on the card. A joint credit card will be suitable for you if you both share the same financial goals and trust each other to do the right thing. However, if your partner goes on a spending spree without your knowledge, you are both responsible for repaying the debt. If you can't repay the debt, it will affect your credit rating as well as your partner's.

Primary and secondary credit cards

If you already have a credit card in your name, you can arrange for your partner to have an additional card on your account. This can be useful if you have a better credit history or higher income than your partner. However, as the primary cardholder, you will be solely liable for any debt on the account.

Cancelling shared credit cards

If you want to cancel a shared credit card, there are steps you will need to take to cancel the card properly.  These steps will depend on whether you have a joint credit card account, or whether one of you is the primary cardholder, and the other is the secondary cardholder. See how to cancel a credit card for more information.

Joint bank accounts

Opening a joint bank account is a big step in your relationship. Visit joint accounts to help understand the risks and benefits, and how to close a joint bank account, so you can work out whether it is right for you.

Get informed

Get professional advice before:

  • guaranteeing a loan
  • signing your name to a loan which will only benefit your partner
  • becoming a partner in a business.

Find out more about going guarantor and co-borrowing.

To maintain some financial independence, think about keeping your own bank transaction account and credit card in addition to any joint accounts.

Prenups

If you have assets to protect or children from a previous relationship to support, you may consider entering into a binding financial agreement (BFA), also known as a prenup. BFAs can help if you're worried about who should get what if the relationship ends. They are only binding if you have both signed the agreement and received legal and financial advice before signing.

Take care of yourself

Get help with your finances

If you need help with debt or money problems, think about seeing a financial counsellor. The Department of Human Services has a free Financial Information Service (FIS) that can tell you if you are entitled to any benefits, especially if your circumstances have changed.

Consider relationship counselling

If you have broader relationship conflicts related to money, a relationship counsellor may be able to help. Read more about managing relationships on the Australian Government Family Relationships website, or visit the community-based support service Relationships Australia. There is also useful information about your legal rights for dividing property on the Victorian Legal Aid website.

Know the signs of financial abuse

Some people find themselves being pressured by partners, family or friends to hand over control of their money or property. This may be financial abuse.

If you think you may be experiencing financial abuse, seek assistance from the following organisations:

  • 1800 RESPECT is the national family violence and sexual assault counselling service. It is a free, confidential service available 24 hours a day, 7 days a week. Call 1800 737 732 to speak to a professional counsellor.
  • The Family Relationship Advice Line provides information and advice on family relationship issues and parenting arrangements after separation. It can also refer callers to local services that can help. Call 1800 050 321 between 8am and 8pm, Monday to Friday, or 10am to 4pm on Saturday local time, except national public holidays. 
  • Lifeline provides crisis support services. Call 131 114, 24 hours a day, 7 days a week.
  • WIRE Women (Women's Information and Referral Exchange Inc.) are the Victoria-wide free generalist information, support and referral service for women. WIRE Women has conducted research into women and financial abuse.

Keeping a sense of your financial self is key to a strong relationship. Don't be afraid or embarrassed to speak to your partner about money issues, and work on sorting them out together.


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Last updated: 13 Feb 2019