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Financial planning

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When in the process of determining whether to pursue a long-term relationship with a love interest, compatibility always plays a role. Some of the things that you may take into consideration are whether your career goals, plans for the future, and overall lifestyles align. One thing that is not always considered at the start of a relationship, however, is financial compatibility.

“Financial incompatibility is when you have different values and habits around saving, investing, spending, and disclosing money,” says Jeanne Sullivan Billeci, Principal at Sullivan Says Communications & Coaching.

Of course, when a relationship is brand new, it’s unlikely that partners will spend their days discussing their financial goals, credit scores, and investing habits, which means that financial compatibility, or lack thereof, often goes undiscovered until couples are fairly invested in their relationship or are already engaged to be married. But is it a dealbreaker? Well, it depends.

“Dealbreaker is such a harsh term, but financial incompatibility is a major cause of divorce,” says Morris Armstrong, founder of Morris Armstrong EA LLC. “That is why it is critical that people address issues before marriage and run credit reports on each other and disclose assets and liabilities.”

In order to determine financial compatibility, couples should be proactive and have difficult conversations early before finances become an issue within the relationship. While financial incompatibility can be managed, so to speak, when it spawns into bigger issues the damage is sometimes irreversible.

“You need to address it before it becomes a larger problem such as financial infidelity,” advised Ted Rossman, Industry Analyst at “Last year, we found 44% of Americans who are married or living with a partner are committing financial infidelity, which we defined as hiding a checking, savings or credit card account, hiding secret debt, or spending more than their partner was okay with. Once something like that comes to light, trust is broken and it’s harder to regain.”

That said, Rossman was sure to point out that a differing financial outlook in comparison to a partner is a little different from being financially incompatible.

“Simply having different views about money is okay. I find that many couples have different viewpoints. It’s interesting how often opposites attract, like a spender and a saver,” Rossman added. “Some of this is what makes the world go round.”

When it comes to managing finances in a relationship or marriage, it all comes back to transparency and communication.

“Just make sure you’re communicating often,” says Rossman. “I like the idea of setting a defined time to discuss money at least once a month. It can be casual, but take some time to review your goals and expenses.”

“Conversations around money should include both where you are now, and where you want to be in the future, adds Richard Barrington, Senior Financial Analyst at Money Rates. “The ‘Where you are now?’ talk should include how much debt each of you has, whether you’ve had problems paying your bills in the past, and how readily your income covers your expenses. This discussion should reveal not just the person’s financial status, but also their attitude towards meeting their obligations. Beyond the dollars and cents aspect of this, ask yourself this: do you want to get in a serious relationship with someone who blows off their commitments.”

As for how one can go about initiating these sensitive conversations, Barrington had this to say:

“A good way to lead into these discussions is by volunteering information about your own finances, though stop short of disclosing sensitive information like bank account numbers and Social Security numbers. Volunteering your information first, including about any financial problems you’ve had, will make the discussion seem less like an interrogation and more about openness.”

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