When you first start dating someone new, finances may seem too taboo to talk about. But if things continue to go well, they should be addressed sooner rather than later. People often try to overlook financial issues when embarking on a new relationship, as it can be uncomfortable and awkward to discuss. But if you see a future with that special someone, it’s important to know what kind of financial baggage they bring with them. Before you can talk about financial red flags, you have to know what some of them are. Here are the top four financial red flags to be aware of when dating someone new.
Red Flag #1: Having Different Approaches to Saving
If your partner is a spender and you are a saver, this could be your first major red flag. It’s critical that you both discuss in detail your savings plans and goals. If you share accounts or credit cards, you don’t want one person spending more than their fair share. Not only would this negatively affect your savings goals, but it can also create a power struggle over financial control. It’s important to discuss how much money you’re okay spending on certain items and creating a budget that will help you compromise to meet your financial goals.
If you’re still unable to reach an agreement, it may be best to keep your finances separate for now.
Red Flag #2: Not Discussing Your Credit Scores
Disclosing your credit scores is a must. Depending on what your partner’s credit score is, it could diminish your chances of getting a house together or making any other big purchase. Sure, you may not need to know your significant other’s credit score on the first date, but it should be discussed as things get more serious. This especially holds true if you start discussing marriage or making any big purchases together - such as a car or home.
Red Flag #3: Neglecting To Address Debt
Is your partner accumulating high-interest debt without actively seeking ways to pay it down? Or maybe they’re inundated with student loans, car payments, a mortgage, etc.? Whatever it is, it’s essential that you know what their debts are and how they plan on handling them. If you’re still getting to know one another, they may not be comfortable divulging the actual amount. You should, however, have a good understanding of whether or not they’re paying it off responsibly and spending wisely.
Red Flag #4: Not Sharing the Same Financial Goals
Do you want to save for a house? That’s great! But, make sure your significant other has a same, or similar, goal as well. Simply assuming you both share the same financial goals will only set you up for disappointment.
While the relationship is still fairly new, outline what your end goals are. Maybe your partner wants to save for a vacation home but you want to retire at an early age. Whatever it is, it’s critical that you come to a compromise and end up on the same page.
It’s only natural that the excitement of a new relationship can cause you to overlook some major financial red flags. But when the time is right, it’s important to address these red flags sooner rather than later - especially if you’re both in it for the long haul. Addressing these four financial concerns can be a productive place to start.
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