Column: Come out of the financial closet

I recently read a report that said 96 per cent of people who are married, engaged or living together say it is the responsibility of both partners to be completely honest about their financial affairs.
If you're in a relationship, or about to get married, now's a good time to talk with your partner about financial matters. Take the time to do it right and it will help ensure the tranquillity of your life.
1. How much money do we have?
What's in all of your accounts? Being completely open here speaks well for the level of trust in your relationship.
2. How much debt do we have?
This discussion also needs to be completely honest with all cards on the table. You will be much better off if you both reveal your complete, true financial state. There's no point in hiding a skeleton in the closet that will some day jump out and really disrupt the relationship.
3. How much income can we expect?
How much money do you both make in a year? Will that grow in the future? How steady is your employment? Will there be enough money to pay for the standard of living that you're envisioning together?
4. What are our known and required expenses?
You'll find yourself saving money on most of these things when you live together, but you need to touch base on all expenses. Perhaps one of you has child support payments or has a large debt to pay off? These financial requirements are important and need to be specified right from the start so both of you know about them and what's required.
5. How much do we frivolously spend each month?
If you're a shoe addict or have a thing for your DVD collection, be honest about the cash you're spending on these pet projects. It's also important to be realistic about how much you're going to cut down - if at all. It's best to talk it out earlier rather than later.
6. Should we use an allowance system for frivolous spending?
You need to specify how you're each going to be realistic and fair about frivolous spending. It's not healthy for any relationship if one person spends like crazy while the other one doesn't have a cent. It's also not healthy for both people to agree to spend a certain amount, but for one to "spend" more with the help of a credit card.
7. Will we combine our money?
For many, but not all, couples, combining your money is the best choice. Many argue that not doing so indicates a lack of trust between the two sides, but there may be reasons for keeping them separate. Talk about this in detail and make a decision that is right for you.
8. If combined, who will be the primary money wrangler?
In many relationships, one member handles most of the financial decisions. Be clear on who that is going to be. Who's going to make sure the bills get paid and keep track of the money that needs to be in each account?
9. What will happen to our estate?
Obviously, in the event of one of you passing away, all assets will probably go to the other. But what if you both pass on?
Trust is the key to any relationship and money can be one of the hardest parts to build trust on. Take the time to do it right.
- Allan Williams is an adviser with Spicers Portfolio Management