Having a clear understanding of your financial situation is essential to successfully planning for the future, regardless whether you’re single or in a relationship. However, a survey done by finder.com found that Australians are more comfortable talking about sex and politics than they are about money, with 42 per cent of respondents claiming that finances are the most difficult thing to talk about, even more so than religion.
The report found that less than 20 per cent of Australians regularly discuss their financial situation. Baby Boomers (aged 55 to 74) are the generation least comfortable talking about money, with 56 per cent claiming they never discuss it, while 33 per cent of Generation Y (aged 18 to 34) often talk about money.
Talking about your financial situation is one of the best ways to start controlling it and making the best with what you’ve got. Here are five questions you should ask your significant other today, so you can be sure of your financial future.
1. What is your financial situation?
Get a run-down of any outstanding loans or credit cards, any assets or property holdings you may have, how much money is coming in, how much money is saved and where you are on superannuation. The first step to understanding your finances is knowing what you’re dealing with.
2. Do you have a budget and savings plan?
This is a good question to find out if your partner is conscious of balancing their income across living expenses, and whether they have a ‘save it’ or ‘spend it’ mindset. This is an opportunity to work out a budget together, and decide on any savings goals you might have.
3. Do you have emergency savings?
An emergency fund is an amount of money set aside should anything unfortunate befall you, such as unexpected unemployment, accident or injury. The ideal amount of money in this account is three to six months’ worth of your living expenses.
4. Do you have insurance?
Talk about home and/or contents insurance, life insurance, car insurance, private health insurance and personal income protection insurance. Do you have all the insurance you need, or are you paying for something you don’t
5. Is your will up to date?
Are your loved ones financially secure should something unexpected happen? While unpleasant to think about, it’s important to know that those you love are taken care of. Ensure your relationship status, assets, superannuation, insurances and other valuable belongings are all accounted for in your will, and kept up to date. Make sure you know where this document is kept. ASIC’s Money Smart website is an excellent source of information for any worries you might have.
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All the advice in this story is general in nature and has not taken into account your objectives, financial situation or needs. Because of this, before acting on any advice, you should consult a financial planner to consider how appropriate the advice is to your objectives, financial situation and needs.