There are so many things I love about my husband, including that we have the same financial values.
I’m thrifty; he’s thrifty. I love saving; he loves to save. We rarely have a major disagreement about money. At the start of our marriage almost 24 years ago, we laid out how we would handle our finances together. We had the money talk long before we planned any aspect of our wedding.
I was thinking about this as we head toward the lovers’ holiday, Valentine’s Day. Many couples fail to realize that there’s a business aspect to their relationship. Money matters have to be worked out. Financial differences need to be negotiated. And this is even more important now, given the complicated state of love affairs.
People are cohabiting in record numbers while marriage rates are declining. There are civil unions. Gay marriage is legal in a growing number of states. But what happens when these relationships, many entering new legal territory, end?
The financial fallout is often messy, hostile, petty and expensive. CreditCards.com found in a poll that about one in five Americans in a relationship said they’ve spent $500 or more without their partner’s knowledge. Six percent of couples said they keep secret checking or savings accounts or credit cards.
Last year, the American Academy of Matrimonial Lawyers reported a jump in same-sex couples seeking legal advice to discuss cohabitation agreements and other legal strategies. In a 2013 poll, 63 percent of divorce attorneys said they’d seen an increase in prenuptial agreements. Forty-six percent had noted a rise in women initiating requests for prenups.
Do more people need “love deals”?
That’s the case made in “The New Love Deal: Everything You Must Know Before Marrying, Moving In, or Moving On!” by Gemma Allen, Michele Lowrance and Terry Savage. Allen is a divorce attorney. Lowrance, a former divorce court judge, is now a mediator who works with divorcing couples and those who want prenuptial agreements. Savage is a nationally syndicated personal finance columnist.
Their book, my pick for this month’s Color of Money Book Club, is a cautionary tale that every couple should read, even if they don’t feel compelled to draw up a legal contract for their union.
“The best relationship ‘deal memos’ define the obligations of each party while the partnership is working — and the rights of each party if it fails,” the authors write. “Whether you are co-habiting, marrying or already married but negotiating through a rough patch, the act of discussing not only financial but structural issues (who gets what, who does what, who owes what) will lead you to a better understanding of each other.”
Allen writes: “Divorce is an emotional and economic disaster for most families. Even at its best, it’s always about division. We do more planning for our weddings than we do for our marriages. I’d rather help you create your new love deal than guide you through the lengthy and painful litigation of a breakup with no rules except those dictated by blind justice.”
Lowrance, the former judge, says this: “I have witnessed too many vows that proclaimed ‘til death do us part’ eventually coming to mean ‘til change do us part.’ ”
Even if the fights aren’t really about the money but other underlying issues, the scorecard that’s kept comes down to money, Savage says. “Money often becomes the proxy for power within the relationship,” Savage writes.
The authors make a compelling case that cohabitation agreements are smart for couples choosing to live together; they help where the law hasn’t caught up with changing family dynamics.
I’ve always felt that a prenup for a marrying couple is a plan to fail, an exit strategy before they have even entered the marriage. But the authors have a point that the communication and disclosures that need to take place — the vulnerabilities that are exposed — in preparation for a prenup can or should help ferret out potential conflicts. They should lead the way to compromise.
“While you can’t change your partner’s basic money mentality, you can set up systems and define rules that allow you to live in harmony and financial security,” Savage writes.
Where the book is strongest is the advice and pleas to communicate openly and honestly before you join your lives and finances together. There are good tips about what should be in the various agreements and what to avoid, but it’s the authors’ discussions about what happens when couples don’t communicate about their financial expectations that make the book worth reading.
Just before Valentine’s Day, I’ll be hosting a live online chat about “The New Love Deal” at noon Eastern on Feb. 12 at washingtonpost.com/discussions. The authors will be joining me to take your questions. If you’re thinking about taking the next step with your partner, and if money is on your mind — and it should be — join the discussion.
Write to Michelle Singletary at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071 or firstname.lastname@example.org. Comments or questions may be used in a future column, with the writer’s name, unless otherwise requested. To read more, go to http://wapo.st/michelle-singletary.