Most divorces arise from serious disagreements about money: How to handle it, how to save and spend, how to get it, and who has the power or control over it. Whenever I see a statistic about what causes people to break up, THINGS and MONEY are always the number one issue. He can’t keep a job. She spends every dime that comes into the house. He wastes the joint money on golf, a boat, or some other habit he insists on maintaining. She overspends on the kids, claiming a right to do so because “it’s all about the CHILDREN”, despite that it will put them into bankruptcy. She refuses to work despite that he says they can’t afford a stay-at-home parent. They spend themselves into bankruptcy. He doles out money to her like a parent giving allowance to a kid. She maintains her salary in a separate account for herself (after advice from others that a woman always needs “her own” money), while thinking of HIS salary as jointly owned. He sends money to his parents to help them out in their old age, despite that she says they can’t afford to do so. She is jealous of the alimony or child support that he owes to previous relationships and wants him to run to court and find ways to reduce it. They invest in a business, throw all their money into it, and then can’t agree on some details of how to save it when it fails, and blame each other for losing their nestegg. Every one of these situations comes from a divorce I handled, and I could simply keep going. The point is that every person has their own issues, and every couple develops their own ways of handling the joint issues. And many times, these issues and the couple's ways of handling the issues can create problems.
However it comes around, money is a huge issue in many marriages, and is the catalyst for most breakups.
Given this information, it makes sense to have long discussions about money before you marry. If your officiant does not require pre-marital counseling that has a component about finances, you should do it on your own. And even if you do get a premarital counseling on finance, you should work harder on this issue than your counselor requires.
After years of being a divorce attorney, I decided to avoid this for my future relationships. When we were dating, I decided to explore the whole situation before we went further. Use my choices as a guide in doing it, yourself: I provided information to my (now) husband about my finances, my office and business, my retirement savings, my income and my tax liabilities. He knew the value of my house, my car, and the loans on them. He knew about every credit account I had. I asked for his information. I got him to let me browse through his copy of his divorce file along with all the financial disclosures from it. I checked to make sure he had fully paid his divorce lawyer from his previous marriage. I knew his child support situation and his retirement savings situation. I looked (with permission) at the credit bureau report that he had from the purchase of his post-divorce house. I offered for him to get a credit bureau report on me.
We talked about our future plans, about our business plans, our retirement plans, our careers, our plans for financing our lives. We talked about the fact that neither of us were from rich families and were not living off of trust funds. We talked about whether either of us would have ongoing obligations to our parents as they aged and how we planned to handle the moral obligations without ruining ourselves financially. We talked about the same issues in regard to his kids and their college expectations. We looked at each other’s career paths, and discussed the mistakes we and each other had made.
Even with all this talk, there were surprises. We did not anticipate the economic downturn and the resulting affect it had on our real estate and retirement accounts. We did not anticipate the job situation that required us to move around the country. But the fact that we had discussed all these other pieces of the puzzle ahead of time made it possible, when the country’s financial crisis arose, for us to trust each other in discussing how to resolve our personal issues within the country’s crisis.
The older you are, the more of a track record you have in issues involving things and money. Look at how someone chooses to spend thier money. Are they living high on a small budget and using credit to do so, or are they pinching pennies with a million dollars in the bank? Are you overspending your income and hoping a partnership with someone will help solve your credit issues? Does your proposed partner know that you expect them to solve your money issues?
If you and your partner are young, it’s difficult to ascertain what your partner’s attitudes might be, but even if both of you are financial babies (very new to understanding financial issues), you can figure out if you have similar hopes and dreams, and whether you have a smart plan for making those things happen. You know whether each other has bought all the toys you can afford or whether you are trying to develop a habit of working and saving for a rainy day. And recognize that it will take work to grow together in these issues.
If you and your partner are older, you can look at your partner’s track record and figure some of this out. Expect that you will not change someone else’s basic attitudes about money. Expect that you will have to negotiate and grow together on this issue. Expect that from time to time, even people who agree on everything will encounter surprises or have to negotiate. But you cannot ignore it.
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