Financial Disclosure Before and After Engagement

Kyle and I never had to sit down to have any one big money disclosure talk.  We started dating in college so we saw one another go through the transformation from dependent on our parents to being independent adults, with all the minor steps that happened along the way.  We talked over our stipend offers for grad school, possible places to rent, how I was dealing with my student loan and car debt, and where to invest our Roth IRAs.  There have never been any money secrets between us because we built up trust in one another before we had any money stuff going on (aside from student loans and summer stipends).

 

I realize not everyone is in such a position, though, and most people moving toward marriage have plenty of financial baggage that their partners may or may not be aware of.  How should they decide what to reveal and when?

 

There are going to be as many answers as there are individuals, of course.  Some people are just much more open about money than others and people build trust within relationships at different rates.  But I’ll give you a few thoughts:

 

You should get all the really bad stuff on the table before engagement.

 

If you have an above-average debt load, especially if that debt isn’t obvious from your lifestyle or resume (we can assume MDs and JDs are in major debt, and be pleasantly surprised if not), you should let your intended know as early in the relationship as you are comfortable and definitely before engagement.  If your career aspirations are low-paying to the point that you cannot support the future lifestyle you desire, he/she needs to know that before making the decision to marry you.  Anything that may deter your intended from marriage needs to be aired while marriage is under discussion but before anyone buys a ring.  You don’t want to hold negative information back until after the decision to marry has been made, lest your fiancé(e) think that you duped him/her and resent you.

 

If you want to, you can wait to share really good stuff until after engagement.

 

Some people with high incomes, substantial savings, or an expected inheritance may be reluctant to let dates know about their means, lest they attract partners for the wrong reasons.  It’s fine to keep the good stuff about your situation to yourself – for a while.  But after you have agreed to marry, you should let your fiancé(e) in on what you’ve kept to yourself to date.  It will almost surely be a welcome surprise, and you can be confident that your intended loves you for you.

 

Your partner doesn’t need to know every detail about the past, but do reveal everything that affects you currently.

 

Don’t feel that you have to confess every bad purchase or bad habit from your past.  If you have damaged credit, it’s enough to 1) state what your credit score is and how quickly you expect it to recover and 2) explain the checks you now have in place to maintain a healthy relationship with money.  Let your partner know the areas you still struggle with and where you will need his/her help.  I don’t believe that you must be out of debt in order to marry, but you should have addressed and corrected on your own the causes for you (particularly consumer) debt.

 

Remember that it all has to come out before the wedding.

 

If there is anything (relevant) that you still want to keep from your fiancé(e) as you get closer to your wedding day, you really need to consider why the trust hasn’t fully blossomed in your relationship.  Are you untrusting or is your partner untrustworthy?  Either way, you must work on the underlying issue before entering into marriage.  If you have some assets that you are trying to keep from your future spouse (red flag), a prenuptial agreement would be far more effective than attempting to keep him/her in the dark.

 

This set of disclosure conversations, whether it’s one, several, or totally organic like it was for us, is an essential component to moving toward marriage.  However, there are many other money-type conversations you need to have so don’t stop there!  You need to decide if you will handle your finances jointly, figure out how your money personalities will match, set up your first joint budget, talk over your career aspirations, and much more!

 

Have you had a big money disclosure talk with a partner and how did you handle it?  Do you agree that most things should be disclosed before engagement?  Have you ever disclosed a financial situation to your partner that made him or her rethink your relationship (or vice versa)?  Do you disagree that you should share everything before marriage?

 

photo by hisks

 

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21 Responses to "Financial Disclosure Before and After Engagement"

  1. Modest Money says:

    Yep you definitely need to talk about all this kind of stuff before getting engaged. Most of these problems can be worked through, but you need to know what you’re getting into. Ultimately you have to be able to trust each other. So if there are some financial secrets you choose to keep, you need to get to the bottom of those trust issues.
    Modest Money recently posted..Considering Switching Careers

    1. Emily says:

      Nothing to add to this comment!!

  2. Yeah… we didn’t. I was aware of the bad car loan and that she couldn’t afford her apartment by herself, but that was about the extent that we knew of each others finances when we got married. That we were both carrying a lot of debt wasn’t particularly surprising, but we didn’t know how bad off we were until we started combining finances and it became obvious that I wasn’t going to find a job any time soon.
    Edward Antrobus recently posted..Procrastination is Bad: Mm’kay?

    1. Emily says:

      I doubt you would have made a different decision regarding marriage, but I think it is helpful to know what you’re getting into so you can work together well with no hard feelings. Finances can cause lots of fights, of course! I hope your marriage has been ultimately strengthened by having to work all that out post-wedding.

  3. jefferson says:

    That would be pretty rough to have a bad financial situation come to light after the marriage.. You get people’s good and bad when you marry them, and their debt is your debt. A scary proposition if you aren’t completely open.
    jefferson recently posted..DIY Wall Art For Your Living Room

    1. Emily says:

      Even after engagement would be rough, which is why I’m advocating all the negative stuff to get out before the decision to marry is made. Engagements are so hard to call off even if major problems come to light!

  4. When you get married and take your vows, it goes something like this. I take you to be my lawful wife/husband/partner, to have and to hold, for better, for worse, for richer, for poorer, in sickness and health, until death do us part. It does say for richer or poorer, but unfortunately many couples across America just don’t spend time discussing money. More often than not today, I see separate accounts, unmerged finances, and she pays this and I pay that.

    I’ve been married for over sixteen years, and while I am the one that predominately handles the money, there is nothing hidden in our financial relationship. The more secretive and separate things are in a financial relationship, the worse it always turns out to be whether it be your household or in business partnership. I have the same kind of relationship with my business partner.
    Ted Jenkin @ Your Smart Money Moves recently posted..Five Financial Moves To Make When You Change Jobs

    1. Emily says:

      So I personally completely agree with you. Openness and joint finances all the way for us. But not everyone has the same view of marriage that you and I do. I agree that secrecy, particularly in finances, is toxic to a marriage, but I think that spouses can keep separate finances and still be totally open with one another (Mint!).

  5. Leigh says:

    I think that these types of things should come up organically during relationships, but I also feel like I’m more likely to ask questions about finances the more I like the person I’m dating. I dated someone for 4 months last year and the only time we ever talked about money was when our employer started offering the Roth 401(k) and he asked me about it.

    I’m dating someone now (yay!) and I’m not that worried about money topics. We work in the same industry, so we have similar high incomes, which makes it less worrisome to wonder if the other person likes you for you or for your income. My having bought the condo recently sort of gave a starting point for talking about stuff, which was kind of cool.
    Leigh recently posted..Would I take a job I hated for double my salary? Triple?

    1. Emily says:

      Sounds like you’re on your way! I guess the only issue you might run into with someone who has a similar income is if they have chosen a very different lifestyle – like if I were dating another grad student who thought it was OK to be taking out student loans!

  6. I think its kind of selfish to hold out on other people with this kind of info. When you’re getting married, you want the best for that person. So why sabotage the relationship by not disclosing this info ahead of time. Open conversation is usually always the best policy.

    1. Emily says:

      Yes, I agree it is selfish to keep this information when you are supposed to be transitioning into a more selfless relationship. But I suspect people who keep negative secrets are motivated primarily by fear.

  7. Michelle says:

    We’ve been upfront about everything from the very beginning. It has worked out well!
    Michelle recently posted..Money or Passion?

    1. Emily says:

      The advantage of getting together young!

  8. bogofdebt says:

    We were up front as much as we could be. To explain: we were still in the denial phase and the out of sight is out of mind phase. I let him know that I knew I had a lot of debt but was unsure of how much. When I found out, he was the first person to know. I didn’t want to go into a relationship where we hid things from each other. But we did talk about it and came up with a plan as soon as details came out.
    bogofdebt recently posted..Spending Recap 8/6-8/12

    1. Emily says:

      That’s a good point – you can’t divulge what you don’t know! But if you aren’t mature enough to handle your finances well, you aren’t mature enough to get married. Not that that actually prevents people. I’m glad you’re on the right track now!

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