The Independent

When it comes to dating, a lot of the outdated, gender normative, etiquette that was once nonnegotiable, grows less and less important by the year.

It's no longer necessary for women to get married, men don't always pick up the dinner bill, house hold chores are shared, and communication is open in a way that was not a given for past generations.

Another perk of changing relationship dynamics should be the ability to have an open conversation about finances with your romantic partner. We've come too far to leave finances out of the equation when it comes to partnership, whether that's a restaurant bill or your daughter's college tuition. So no matter what stage of your relationship you're in, be sure to start a dialogue.

At the Beginning of the Relationship

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By date three, you and your partner are certainly not discussing how you might finance a house, but that's not to say you can't get a gauge on values when it comes to money. This doesn't necessarily have to be a conversation as much as an observation.

"Ask them, 'If you won the lottery, what would you do?' I think that tells you a lot about a person," says financial planner, Erin Voisin. Telling questions like these are plenty useful for getting to know someone in a holistic way, and money is just a little part of that.

"Do they do things that are irrational or impulsive?" asks Reshell Smith, a second financial planner. "I also think people's attitudes about money comes from their family. Talking about family, parents and how you were raised — you can get an idea from there."

When you're still feeling each other out, it's good to have an understanding of the kinds of things your partner is willing to spend money on. You don't have to ask how much, but knowing if they're more inclined to drop their paycheck into a Planned Parenthood fund, a family vacation, or a pair of Nike Frees is definitely valuable information.

When the Relationship Gets Serious

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Serious is, of course, a relative term. Plenty of couples take years to say "I love you." Some take weeks. Some think open relationships are easier than committed ones. Some swear off marriage. But once you feel like you're genuinely committed to another person, there are certain money questions that need to be asked.

Voisin recommends making time to talk about the highs and lows in your economic histories. Did you invest in something stupid? Do you impulsively shop? Are you frugal to a debilitating point? "Talking about financial successes and failures is important," she explains.

If you plan to continue your relationship, you'll get in the habit of spending money on and around one another quite a bit. That means you need to know about major debts or serious trust funds (yes, this includes a conversation about credit score).

When You Decide to Move in Together

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This is quite possibly the most difficult test any couple undergoes — only the strong survive. Cohabitation can entirely change the way you relate to a person. Not all good friends make good roommates, and not all good romantic partners do either.

From a financial angle, living together, of course, implies splitting the cost of a home — but it also implies dictating what is mutually owned, and what is personally owned.

"If you both are living in separate places, you probably have two washers, two dryers, two TVs. These are things you can sell to raise money for a wedding or to help pay down debt," says Smith. But do you decide who has the better version of each? Whose debt are you paying off? The yours, mine, ours conversation is not an easy one.

It's recommended that you test out a joint savings account where you can deposit mutual funds. Not only does this make the financial conversation a little bit more fluid, but it also helps with division of cash when you split. Don't overthink it, but this is, of course, always a possibility.

When You Get Married (or make a long term commitment)

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Ok, so you survived the cohabitation test. You can actually live within the same four walls, and you still like each other — even love each other.

At this point, you should be a little more secure when it comes to sharing. Theoretically, you'll have mutual accounts 'til death do you part. We're not saying this is set in stone — but it is some form of guarantee. With your commitment, however, come conversations about retirement funds, kids, and longterm housing. That's tough stuff.

Viosin recommends discussing dependency. While of course different couples support each other in different ways, it's important to make sure the full financial burden doesn't fall on one party. "It's making sure that each person has enough … and having that conversation about what does 'taken care of' actually mean," she says.

There are plenty of ways of validating a relationship in the long term, and marriage doesn't have to be one of them. But, if you've committed to spending your life with someone, you should feel that you're both shouldering part of the financial weight, and that you both feel secure. And unfortunately, like everything else, that's going to have to be a discussion.

When Your Family Starts to Grow

Happy Young Attractive Mixed Race Family with Newborn Baby. Tennesse Fertility Institute

Not everyone will decide to have kids — families can be defined in many different ways. You might have nieces and nephews close by, or in laws who have to move in. You might get a dog. You might adopt. You might nurse a thriving garden. Regardless of the entity, odds are, you will become financially responsible at some point for someone besides your partner.

"Once you have kids, your lives will generally revolve around them and their education," Huffpost reports. You and your partner need to take that in stride. You'll want them to have appropriate clothing, healthy food, and top-notch toys, but you'll also pour money into their education, health care and personal happiness.

"Those are conversations you definitely want to have ahead of the baby coming, because that's a very short time frame," says Smith.

If we're just talking about a dog here, the budgeting falls on a smaller scale, but regardless, it's hard factoring another body into your financial plans. On the other hand, it's a privilege and you ought to appreciate the fact that you've got someone around to brave the financial world with you. Money talk may never come naturally, but with the right person, we promise it will be worth it.

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The Federal Reserve sets the guardrails for the federal funds rate, and through that helps control the money supply for the nation.

When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.

A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.

One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.

The Federal Reserve The Federal Reserve


The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.

This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.

The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.

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