Whether you're moving in with a roommate to save money or with a romantic partner as that next relationship step, combining households means combining finances. From who pays for what to how you'll save, here are three things to consider before you start packing those boxes.
1. What's Your Magic (FICO) Number?
It may seem gauche to ask for a living companion's credit report, but Denise Winston, a former banker and author of Money Starts Here! Your Practical Guide to Survive and Thrive in Any Economy says that not knowing can be a costly mistake that adds up quickly over the years.
Why? A poor credit report can impact everything from getting a job to buying a blender. "Many employers check credit during the hiring process, so it may affect earnings potential," Winston says. "It could also affect where you live, as landlords often check credit for potential renters."
The same holds true for rates for car loans, mortgages, and insurance, as well as APR and eligibility for credit cards -- including that retail card you sign up for to save 10 percent on a new blender.
2. Who Will Pay for What -- and When?
Christina Steinorth, author of Cue Cards for Life: Thoughtful Tips for Better Relationships, says that before moving in together, it's important to set up a joint budget. "Include everything: utilities, food, insurances for car, home, health. If you plan to have children, include the expenses that go with raising a family," she says. "Think of everything possible. You really can't be too prepared or detailed when it comes to budgeting."
Kevin Gallegos, a vice president with Freedom Financial Network, says that budgeting is imperative, but shouldn't just be about money.
"The key is to set goals first. These are life/activity goals, not only financial. This is where couples discuss the types of things they'd like to do in retirement, the kinds of vacations they want to take, and specific items they may want to purchase," Gallegos says. "Goals also can include time-based ones, such as making sure to have time to train for a marathon. This process allows for incorporation of both [of your] ideas -- maybe there's one vacation camping and backpacking, and another that's a trip to Europe."
3. Whose Name Will Go Where?
For every household bill, someone has to sign on the dotted line. Will both names go on a lease or mortgage? Will one person be responsible for heat and the other for hot water? Will the sloppier one pay for a cleaning service to keep the peace? What are the deposits required for each service? Will additional deposits required as a result of one of you having bad credit? How will overages on a shared calling plan be managed?
Even the most thorough list can overlook cohabitants' discretionary spending on things like food, alcohol, and entertainment. Matchmaker Jacqueline Nichols says it's important to ask, "How will you each compromise so no one feels they're carrying the greater load or are being unfairly restricted?"
Fools rush in
If all the careful planning and discussions don't help create harmony, there may come a time when one person has to move out. Knowing up front who will leave, and how any deposits will be split or utilities signed over, can help minimize the chaos and heartbreak of dividing a household. This can be an easier decision if one person moved into where the other person already lived, but a little trickier if two people rented or purchased an apartment or home together.
While each living situation is unique, Nichols says there's one rule that's good sense across the board: waiting. "We're on our best behavior for the first 12 months of a relationship. After that, we tend to a let our guard down a little," she says. "If there's going to be any type of thing you may raise an eyebrow about when it comes to your partner's financial habits, it will probably start to show up sometime after the 12-month mark."
You can follow Motley Fool contributing writer Molly McCluskey on Twitter @MollyEMcCluskey.