It’s wonderful to lose your heart to someone, but no matter how old you are, it is important to be practical about finances when things get serious.
New romances are great – the excitement of dating, the butterflies when the phone rings, not being embarrassed to use heart emojis, being told by your friends to get a room…
But if things get serious, big decisions and intense conversations frequently follow, especially if you are at an age where things like property, investments, and looming retirement are part of your life.
Love affairs might have been simpler in years gone by, when neither of you owned anything more valuable than a spluttering Ford Fiesta, but as we get older, many of us accumulate more assets. It’s not hugely romantic, but when it looks like a relationship might actually go the distance, it is important to be practical and honest about finances.
“Depending on the seriousness of the relationship, you might want to discuss bigger financial decisions and your financial goals to get a stronger understanding of how each person views money,” says Forrest McCall, financial blogger. “Communication is key when it comes to relationships, and it doesn't end when it comes to money.”
If marriage or moving in together is on the cards, it’s wise to find out if you’re merging your life with someone with similar views on money to your own – and if there are differences, it is important to work out the details.
Everything needs to be sorted out before moving in together - from whether someone will end up selling or renting out a property they already own if you decide to share an address to the monthly minutiae of how to pay the bills. And remember, if one or both of you receive any kind of state benefits, you will need to inform the Department of Work and Pensions about your changed living arrangements. Age UK provides excellent advice on managing this often-confusing situation, especially if means-tested benefits are involved.
“Joint accounts can be very useful in practical terms,” says financial expert May Fairweather. “If you have shared expenses, an account that you can both use and access means less transferring money back and forth, or working out how much you owe for split bills.”
However, if you break up, a joint account can become a source of acrimony. If one partner clears the account, causing bill payments to be missed, or racks up an overdraft, both parties are liable for this.
“Banks typically won’t make changes to a joint account without agreement from both owners, although if you find yourself in a scenario where your joint account is being used against you, speak to the bank about their economic abuse policy,” advises Fairweather.
If a partner dies, there are inheritance tax implications, as the surviving partner is the sole owner of the money in the joint account. This won’t be a major issue if the balance isn’t huge, but if you plan on keeping large sums of money in a joint account, seek advice.
“I'd recommend always making sure you have your own individual account, and you each get your income paid into that account – this lets you set up automatic transfers into the joint account for the amounts you've agreed to contribute, but preserves some independence for you both,” says May.
Even if retirement seems like a long way off, it is important to plan ahead to make sure your autumn years are financially comfortable. Discussing pensions might seem a bit of a bore when all you want to discuss with your beloved is whether satin sheets really are romantic or just slippery. But if you think this might be the person you want to spend your dotage with, it’s a necessary conversation.
“As you age, it's also critical to think about your retirement plans and how you will manage your finances in the long term,” says McCall. “This is a conversation that you should have with your partner early on, so that you can make sure you are on the same page.”
“Remember to check whether you need to update the beneficiaries of any pensions, insurance or other assets,” Fairweather reminds cosy couples. “You don't have to be living together for someone to be your named beneficiary, but it's often a good opportunity to take stock and make the necessary arrangements – and don't forget about your will!”
Tightening your belts
The cost-of-living crisis is affecting most of us and if you’re in a relationship, it is tempting to splash the cash, especially in the early days. But blogger McCall advises a little prudence with your passion.
“Meeting a new partner can cause you to re-think many things, but it shouldn't cause drastic changes in how you manage your money,” says McCall. “You may be tempted to go out and spend money on fancy dates or gifts, but it is important to maintain a sense of financial stability in your relationship.”
“Try to set boundaries when it comes to your money – this might mean limiting date nights to once a week or choosing more budget-friendly date night options.”
When good times turn bad
Sometimes, a fine romance ages more like milk than a great wine. If you have to call it quits, the last thing you need is an embittered dispute over money.
“Sadly, there's always a risk of financial abuse or romance fraud when you start a new relationship,” says Fairweather. “At the same time, sharing the costs of life with a partner isn't an unreasonable thing to want to do.”
If you’re concerned that your partner’s interest in you is “more fiscal than flirtatious”, Fairweather says there are some warning signs to look out for. These include “attempts to control your spending or access to cash, putting bills and other expenses in your name, needing to borrow money frequently, and/or being resistant to discussions about money.”
Setting boundaries can be a way to protect yourself, whether you’re worried about red flags, or you’ve simply reached a point in your life where you are not comfortable getting in too deep with someone else on a financial level.
Listen to your gut
“While different attitudes to finances are common and often perfectly reasonable, especially after decades of established habits, it's okay to decide that your approaches are too far apart for you to be comfortable becoming financially entwined,” says Fairweather.
“If your beloved gets very upset about your boundaries or reacts strongly to your desire to keep things separate, that's a concerning sign – like many aspects of a relationship, shared finances are a "two yeses, one no" situation.”
Even if neither partner is out to hit the other one in the bank balance, financial counselling can be worthwhile if it becomes tricky to share money, especially if it is causing arguments in an otherwise happy relationship.
“Talking things through with a financial therapist can be a great way to get on the same page, and have those complicated conversations that no one particularly enjoys but which are crucial to avoiding stressful clashes,” says Fairweather.