Honesty when it comes to money is key to a healthy relationship. But when not managed thoughtfully and transparently, finances can easily cause conflict between couples: According to the American Psychological Association, money is a leading source of relationship conflict for 31 percent of couples.

Starting a financial conversation with your significant other early on can help avoid future conflicts about money. Here are four steps to get started:

Step 1: Discuss your values around finances

People have different attitudes toward money, which may stem from types of upbringing, cultural differences, and varying personal goals. Knowing these differences, it can be helpful to have a candid discussion about your values when it comes to money and what matters most to you. You may ask questions like:

  • Do you want to eventually own a home? How soon do you hope to reach that goal?
  • What are your goals when it comes to retirement? Do you want to retire early? How do you hope to live in retirement?
  • Do you want to prioritize spending money on travel and other experiential purchases?
  • What charities do you want to donate to? How much?

Step 2: Figure out where you both stand financially

Pull together items like your credit score, your earnings, your savings, and your debts, and ask your partner to do the same. Sit down together and share this information. Be open and honest (and nonjudgmental) about your situations, how you got there, and how long it will be until you pay off any debts and/or reach your savings goals to help ensure you’re aware of any issues that may resurface in the future.

Step 3: Decide whether joining your accounts is the best option for you

Ask yourself, and discuss as a couple, how much you want to share with one another and how much financial autonomy you hope to maintain. You may consider merging your accounts to make it easier to pay for household expenses and bills, but you may consider keeping accounts separate if you want to remain in control of your own finances.

Consider factors such as how many personal expenses you will still be responsible for and how aligned your daily money-spending routines are.

Step 4: Plan goals for the future

Talk about your goals for the future as a couple and what that means financially. This may include questions like:

  • Where do we want to live in five years? The answer may affect the area you choose to live in, whether to rent or own a home, lifestyle, and other factors.
  • What big purchases and life events should we start saving for? This may include a car, a down payment on a house, or starting a nest egg for retirement.

 Tip 

Ask yourself, and discuss as a couple, how much you want to share with one another and how much financial autonomy you hope to maintain.

As you talk through these goals, consider existing and upcoming responsibilities. For instance:

  • If we plan to have children, what will we need to save for? Do we hope to send them to private school? How much should we save for college?
  • Are we expected to be the caretakers for parents, siblings, or other family members?

Keep this dialogue going throughout your relationship and check in regularly on your approach to finances, to maintain honesty and ensure both of you are aware of any changes to your financial situation.

To further explore the value of financial transparency with your partner, see 5 ways money talk can strengthen relationships.

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