Lecture on Financial Compatibility in Relationships

Introduction

• Speaker canceled her wedding in March 2020
• Fiance was a well-educated, handsome Nigerian-American doctor
• Initially felt like living in a dream, but differences emerged
• Financial incompatibility was a significant issue

Key Experiences

• Differences in living preferences: high-rise apartment vs. affordable housing
• Disagreements over wedding size and costs
• Concerns about savings and retirement planning; fiance had a life insurance plan benefiting a family member
• Pandemic provided an opportunity to cancel without embarrassment

Important Lessons

• True knowledge of someone includes understanding their finances
• Money is a taboo topic but reveals much about a person’s life

Financial Compatibility

• Sharing finances builds trust and shows partners' true selves
• The speaker became a premarital financial counselor for couples
• Communication about money correlates with overall relationship communication

Tips for Financial Compatibility

Tip 1: Do Not Ignore Red Flags

• Red flags are relative; determine personal deal breakers
• Common red flags in finances include refusal to talk about money, financial infidelity, and financial abuse
• Financial infidelity: hiding debt/income or lying about purchases
• Financial abuse: controlling partner’s access to money; prevalent in domestic violence cases
• Discussing money provides insight into one's future and goals
• Early conversations about money can be casual and informative

Tip 2: Do Not Leave Yourself Unprotected

• Prenuptial agreements are for everyone, not just the rich
• Prenups look forward and determine asset division in divorce
• Ensuring financial arrangements protects oneself and children in case of divorce or death
• Postnups and estate plans are also critical
• Protecting oneself is a loving and responsible act

Tip 3: Do Not Be Afraid to Walk Away

• Ending a relationship based on fundamental incompatibilities is necessary
• Recognize red flags and don’t downplay them
• Having tough conversations can prevent future conflicts

Conclusion

• Effective communication about money strengthens overall relationship communication
• Encouragement to have an open, honest discussion about money

Final Takeaway

• Good communication is essential for a fulfilling relationship