Romance equals intimacy, and for many, that includes our finances. Examples of financial intimacy include signing on an apartment lease, opening joint bank or credit accounts, extending loans; paying bills or making other financial gifts; and sharing ATM pass words, bank account numbers and other financial information.
We make some of our most damaging money decisions because we mistakenly think (with plenty of social endorsement from family, church and popular culture) that when it comes to love, it’s okay, and even necessary, to dismiss the rules and realities of protecting our financial health and security.
However, getting intimately involved with anyone without a clear understanding of his or her financial beliefs, health and habits is an open invitation to conflict and disaster, no matter how strong your feelings for each other. Commingling your finances without knowing one another’s financial histories is like having unprotected sex without knowing one another’s HIV status. And the consequences can be just as devastating.
Many people are surprised to learn that the longest chapter of our book, with my wife and business partner Zara D. Green, Loving In The Grown Zone: A No-Nonsense Guide to Making Healthy Decisions in the Quest for Loving, Romantic Relationships of Honor, Esteem, and Respect (Balboa Press), focuses on what’s at stake when financial decisions are influenced by our feelings in romantic relationships. That’s because the financial consequences of an unhealthy, toxic relationship are both considerable and measurable. For example, the cost of a single failed marriage cycle–from engagement through divorce–routinely exceeds $100,000–and much more for mid-to-senior-level corporate executives, pro athletes, successful entrepreneurs, and other high net worth/income individuals. (I encourage you to download my complimentary e-book, Buy Love, Get Trouble; Sell Love, Get Screwed, in which I am transparent about how costly this reality was for me personally.)
It’s important to understand that sex, romance, marriage and procreation are pathways to clear, unfettered and often permanent access to your financial resources—including by criminals. Consider this: Romance scams were ranked the the No. 1 form of financial fraud in 2018—to the tune of $143 million—and that’s only what is reported. The majority of such fraud goes unreported by victims who are too embarrassed to admit they were defrauded or blame themselves for being taken advantage of—or who don’t even realize or recognize they were scammed.
No matter how caught up you are in the throes of romance, protecting your money is your responsibility. Neglect it at your own peril. Here are seven safety checks you can do before engaging in financial intimacy (actually, any form of intimacy) with a love interest:
Have you been in an exclusive, committed, and drama-free relationship with your partner for at least a year? If not, don’t commingle your finances or make joint financial commitments like co-signing on an apartment lease or car loan. “Complicated” and off-and-on “situation-ships” don’t count, no matter how long ago they began.
Also, never, ever give money or perform other financial favors in any online relationship, or with anyone you haven’t met in person—no matter what (including “life or death emergencies” and “can’t-miss business opportunities”). Learn more about avoiding romance scams.
Be intentional about learning your love interest’s financial habits.
“One of the key questions you want to answer is whether your love interest is a safe financial partner or a potential adult dependent,” Zara says. “If the latter, meaning they habitually depend on others to finance their desired lifestyle, engaging in financial intimacy is a bad move.”
Don’t go by assumptions or what you are told, but what you can learn by observation. How does she get income to support herself? Does he abuse credit cards, or use them sparingly? Does she honor her financial commitments, or routinely bounce checks? Is he financing an addiction, or other activity he’d rather you not know about? You each have a right to your secrets. However, once you combine your money, your finances will be affected by your honey’s financial habits and vice versa.
If you are not sure (especially after a year or more) about a person’s financial habits, or that person resists or resents your efforts to learn how they handle money, do not mix your finances.
For a true reality check of how well you know your love interest, check out 6 Things You Should Know Before Opening Your Legs, Checkbook, Heart or Home.
Have regular, on-purpose, conversations about money.
Can you even talk about money with this person? Doing so at least once or twice a month should be routine before even thinking about engaging in financial intimacy.