Five expert tips to help make your finances flourish as a couple

When couples apply for a joint financial product, such as a mortgage, their credit reports are likely to become linked. Photograph: PA
When couples apply for a joint financial product, such as a mortgage, their credit reports are likely to become linked. Photograph: PA
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The start of a beautiful relationship can also bring financial perks. Working together, a couple can take steps to grow their finances, perhaps boosting their chances of getting on the housing ladder earlier, and supporting each other at times when money is tight.

But, as your financial lives become more closely linked, there are also pitfalls to watch out for – which could leave you with an empty wallet as well as a broken heart if the relationship goes wrong.

Here are five tips to help couples live in financial harmony.

Be transparent

If you’re older, it’s likely you’ll both have accumulated some assets along the years, but you may have some financial baggage too. Don’t keep this information secret. Jamie Jenkins, a life savings expert at Standard Life, says: “Tell each other about any debts, as well as your savings and assets.”

Update your will

Jenkins says that while many people put off sorting out a will, it’s vital to keep it up-to-date, as well as thinking about the nominated beneficiaries of your pensions.

Improve your credit score

When couples apply for a joint financial product, such as a loan or mortgage, their credit reports are likely to become linked. If your partner has a more positive credit history, it could mean lenders view your credit application more favourably. But if they have previous bad debt, the way they manage money may be considered in assessing whether you can keep up with repayments.

If you and your partner split, remember to disassociate with credit reference agencies, to “uncouple” credit reports in the eyes of lenders.

Carefully consider
joint accounts

While there are benefits to combining your cash, there are also pitfalls to watch out for. Kevin Pratt, a consumer affairs expert at MoneySuperMarket.com, says: “The convenience of having a single account that can take care of shared bills is a great benefit, but there are potential pitfalls. For example, what if you’re the sort of person who keeps a close eye on every penny, but your partner is more carefree with their spending? What if it’s the other way round – would you be happy with your other half scrutinising everything you buy?

“Plus, if a relationship comes to an end, the joint account can be vulnerable to one partner simply withdrawing the balance and leaving the other high and dry.”

If you want to add a safeguard, Pratt suggests asking your bank to impose a requirement that every party to the account has to give permission for spending outside normal standing orders and direct debits.

Be prepared when
buying a home

David Hollingworth from L&C Mortgages, says: “Buying a house together is an exciting time but also a big commitment, so it makes sense for all parties to fully understand what they are taking on. Mortgage lenders will require that both borrowers are ‘jointly and severally’ liable for the mortgage, which means the lender can seek full payment of the mortgage from either or both of the borrowers.”

He says joint mortgage applications will still need to be able to meet affordability requirements, but being able to pool their income and deposit should help couples reach their borrowing needs.