5 Money Moves to Make Before You Move in Together

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Moving in with your significant other is an important moment in your relationship, and it can feel awkward to worry about anything so concrete as finances when you both have stars in your eyes. But money has a way of causing tension in even the closest relationships if you don't spell out expectations before you've signed a lease or a mortgage contract together.

In addition to the potential strain money can put on your relationship, it's also important to remember that cohabiting couples can have an even greater need to protect themselves financially than married couples do, since there is less legal protection available for unmarried couples who split up after living together.

Though it may seem unromantic, make sure you and your soon-to-be live-in boo follow these money moves before you call the moving trucks.

1. Talk about finances

You may assume that you and your partner each make about the same amount of money and have similar attitudes toward finance. But until you are living together and your joint household depends on each of your finances, you can't really know for sure.

That's why the first and most important step in making sure your new living situation is blissful rather than stressful is to talk openly about your finances together. Discuss how much money you each make; how much each of you are used to spending for housing, utilities, and other living expenses; and how much you spend each month on individual expenses, like student loans, car loans, gifts to family, work-related expenses, and the like.

This may sound like the world's most awkward conversation (just ahead of when your parents gave you "the talk"), but a little discomfort now will save you a great deal of relationship strife in the future. That's because you can discuss fundamental disagreements about how to spend money when you're not in the midst of a financial issue or problem.

For instance, if you know ahead of time that your sweetheart sends $400 per month to help her younger brother in college, it will not come as a nasty surprise when that is the reason she gives for not being able to afford half the cost of a new dryer to replace the broken old one. You will know just how strongly she values giving financial help to family, and you can talk about how that will affect your financial choices as a live-in couple before it becomes a reality. (See also: 5 Money Conversations Every Couple Should Have)

2. Set a budget you can both afford

Beyond the initial conversation about your income, expectations, and financial philosophy, it's important to work together to set a budget that's affordable for you both. This is especially vital if there is a big income disparity between you, since the higher-earning partner may assume they can afford a more expensive place than the lower-earner is comfortable with.

Couples with an income imbalance may be tempted to simply let the higher earner pick up the financial slack, but there are two big problems with this plan. First, it can come with a big helping of resentment to have the income imbalance reflected in housing costs, since the higher earner may resent paying more while the lower earner may feel beholden.

In addition, nothing is guaranteed, including employment. Setting a budget that is completely outside the means of the lower earning partner could turn a potential job loss into a huge financial crisis. (See also: 4 Ways an Income Gap Can Strain Your Relationship)

When you are setting your joint budget, talk about how much rent or mortgage you can each afford, as well as how you will split up the cost of utilities so that you can each easily afford your portion of the housing costs. While it's perfectly OK not to split everything 50/50, it's a good idea to draw up a budget that either partner could handle for at least a month or two in a pinch. (See also: 3 Simple Ways to Split Bills With Your Spouse)

3. Put both your names on the lease

If either partner is not represented on the formal housing document, that opens you up to some big potential problems.

For instance, let's say Brian and Jeff move in together to an apartment just in Jeff's name. If they were to break up, Jeff would have a better claim on staying in the apartment they have both called home because his name is on the lease.

Alternatively, if Brian decides to pack up and leave, Jeff is left holding the bag (and paying the rent solo), and he will have no legal recourse. With Brian's name on the lease, they are both responsible for continuing to pay rent.

4. Put your arrangement in writing

A running gag on The Big Bang Theory is the overly-complex roommate agreement that the socially inept Sheldon drew up with Leonard before they moved in together. While most of Sheldon's quirks should not be attempted at home, this is one that bears imitation, though it doesn't need to be as complicated as Sheldon made it. Writing out the specific financial expectations of each partner can protect you both.

What should you include in the agreement? It should detail how much you will each pay for rent, which partner will pay for which household expenses, when bills will be paid, and any other arrangements for sharing your space.

A written agreement is especially important if one partner owns a house that the other partner is moving into. Without both names on the title, the non-homeowning partner is vulnerable should the relationship go south, or if the homeowner were to pass away. In either case, that partner could be evicted at another's whim because there was only one name on the title. Alternatively, if the homeowner is unable to pay the mortgage because of job loss or disability, the other partner would have no obligation to pay it.

A legal, written agreement between partners can make sure that you both have financial protection in regards to your joint home.

5. Keep separate emergency funds

Having a financial cushion available to leave a bad situation is an important part of financial health. Knowing you have the money to leave an abusive job, a dangerously maintained apartment, or a toxic relationship gives you the freedom to set important emotional boundaries and keep yourself from being walked all over.

When you're talking about moving in with your significant other, you may feel like this relationship could never become a bad situation — but there's a reason why it's called an "emergency" fund. Relationships can sour and people can wait to show their true colors, so it's always prudent to make sure you each have the funds to take care of yourself if you have a relationship emergency. (See also: 5-Minute Finance: Start an Emergency Fund)

Spelling out expectations is the path to happy cohabitation

It's easy to get caught up in the fun part of planning out your move with your beloved. After all, talking about money, leases, legal agreements, and the like is not exactly romantic. But talking to each other about your financial expectations before you are unpacking boxes means you are walking into your new living situation with eyes open, and you will not get stuck in a situation that makes you uncomfortable.

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