There is nothing romantic about marital finance. All the more reason to weigh early on how finances will be blended and decisions made. A matrimonial specialist and family lawyer offers a guide.

Few couples consider financial compatibility before they tie the knot, so when it comes to combining finances, it can spark huge differences of opinion and potentially ruin a marriage if not dealt with carefully. The problem is even more pronounced when substantial assets are involved, including real estate, investments, businesses and large family inheritances or wealth. Matrimonial consultant and family lawyer Sheela Mackintosh-Stewart points out that fights over money are the second leading cause of divorce behind infidelity. In this guest article, she covers the top financial traps couples fall into during a marriage and how they can protect themselves early on. The editors are pleased to share these views and invite readers to respond, although this publication does not necessarily endorse all views of guest writers. Email tom.burroughes@wealthbriefing.com and jackie.bennion@clearviewpublishing.com.

Failing to discuss money management at the outset of a marriage
A lot of fights about money involve a clash of behaviours, beliefs and financial attitudes. Most coupes fail to clearly discuss financial goals and planning with their partner, often resulting in unresolved disagreements on debt, savings, assets, retirement and other financial obligations further down the line, sometimes leading to divorce. To avoid such destructive conflict, discuss fully and understand each other’s psychological financial drivers and work together on key areas of financial conflict, including taking more responsibility for ordering your financial joint lives.

Not considering marital agreements (pre and post nuptial agreements)
Entered into before or during a marriage, marital contracts address how marital assets, including how ring-fence business shareholding and assets will be divided and dealt with on divorce. Many view them as planning to fail, gender discriminatory and undermining marriages. Although these agreements are not enshrined by UK legislation and provide no full guarantee of protection, a well drafted pre or post nuptial agreement following the necessary legal guidelines is highly advisable as they do provide some certainty, clarity and peace of mind whilst keeping legal disagreements and costs to a minimum upon divorce.

Losing financial independence
When one spouse gives up work to raise a family, they often abdicate their financial independence to their spouse. This can shift the balance of power in the breadwinner’s favour and triggers an unhealthy dependence cycle that prejudices the dependent spouse in the long term. One particularly toxic trait is high net worth spouses gifting their wives with valuable jewellery instead of handing out cash as a form of control. Many such women are often very vulnerable on divorce as they have not set up independent financial provisions of their own to weather marital storms. Many assume that their spouses will be fair to them if they part company and go into financial meltdown when that is not the case, leaving them with no access to money to maintain their lifestyles and pay for school fees or legal fees. I strongly advise wives not to stop work completely if possible. Always try to find a way to maintain job ready skills and employability to ensure there is available income if needed.

Merging bank accounts too quickly
Although joint bank accounts enable equal access to monies in the account and are necessary for paying essential household bills, they can cause problems if one partner deceitfully drains it away.

Joint account holders have the right to withdraw money or close the account without their spouses’ consent, leaving the other penniless. In divorce, funds in joint accounts can also be difficult lengthy, messy, costly and problematic to untangle and separate. It is highly advisable to always keep a separate bank account to store some of your hard-earned cash, especially if your partner is a big spender to ensure that you have a nest egg for a rainy day.

Not safeguarding family wealth and inheritances
Family wealth and inheritances received during a marriage can potentially be used to fund divorce settlements for the other spouse. With couples marrying later in life compared with a decade ago, today’s spouses bring in greater pre and post marital wealth, often in the form of inheritance and gifts. Some of these will be used to purchase business assets or a family home and inevitably become mixed and mingled with marital assets. Whilst there is no guarantee of ring-fencing and protecting these pre and post marital assets from being a priority call and automatically shared in the event of a divorce, it is important to get professional advice if you wish to keep them separate, including the use of trusts and marital agreements.

Not registering interest or ownership in your matrimonial home
When possible, register both your names on the matrimonial house title deeds to prevent arguments of ownership in the event of a divorce. If the house is only registered in one spouse’s name, the non-owning spouse should register a notice against the home to protect their rights of occupation. This also prevents the owner spouse from selling the home from under them. Joint mortgages are also advisable because, while both spouses are equally liable for making payments, it alerts the non-owning spouse of any threat of repossession from mortgage lenders if one spouse stops paying the mortgage or leaves.

Financial infidelity
I come across many spouses who hide their uncontrolled spendings and debts from their partners relying heavily and easily on plastic and taking out credit card loans, assuming that they can pay them off before their partner finds out, but often struggle to do so. Such deceit often breeds contempt and mistrust and in some cases bankruptcy. Always keep a close eye on family finances and instill good habits of regularly doing a 'financial check-in' with your spouse on family and personal spending to avoid such bad habits from creeping in and ruining your marriage.

Sheela Mackintosh-Stewart is founder of iFamiliesuk.com. When she is not practising family law, she is on a mission to save marriages by making society ‘relationship-smarter’ and helping people to have more fulfilling and contented relationships, preventing the devastating consequences of marriage breakdowns.