Divorce-proof your finances
By Jasmine Miller • Bankrate.com

For many of us, it's easier to talk about past lovers than our credit history. We'd sooner show our paramour our old Lavalife profile than divulge how much money we make. But if you're getting married, or just moving in together, you have to become comfortable talking about money.

Besides knowing you both like Thai food and action flicks, you need to know about your mate's financial past -- the triumphs and the foibles. Believe that your relationship will defy the odds, but prepare for the worst, so that if you end up splitting, you aren't financially destroyed as well as emotionally spent.

"When women are getting into the throes of a serious relationship, they need to understand the concept of properties and think of what they own in three groups," says Eva Sachs, a financial adviser with Money Concepts in Toronto.

Those categories are premarital assets, the ones owned individually by each of you before the marriage; nonmarital assets, which are gifts and inheritances received before, during or after marriage; and marital assets, which are the things acquired jointly during marriage, such as a home or major investments.

The reason you need to keep everything separate is that these classes of assets are treated differently if the relationship ends. Premarital assets don't necessarily become part of the assets that have to be split 50-50.

So if your uncle leaves you a whack of cash when he dies, you don't have to share those assets with your partner. But if you use the inheritance to make investments together, those assets must be split.

Protect yourself by keeping a paper trail of all major cash and gifts you receive. Keep a copy of the cheque that your mom wrote to you or of the will that names you as beneficiary to blue-chip stocks, as well as receipts for anything you purchase with the money and bank statements that show how and when it was invested in your name.

Ask questions
Before you get tied up picking flowers and bridesmaid dresses, make sure you know all the significant financial info about your significant other.

"People often talk about assets they bring to a marriage, but they also need to discuss the liabilities," says Julie Harris, a certified divorce financial analyst in Wolfville, Nova Scotia, and investment adviser with National Bank Financial.

"We don't encourage that communication, there's not a form you fill out that says, 'We're getting married, here's my paper work, where's yours?' That might stop a lot of arguments and surprises."

What you need to know
Does he have any outstanding loans? His total net worth could affect your ability to get joint credit. And if you want to trade in rent payments for a mortgage or lease a car together, his poor credit could affect whether you qualify for a loan and how high an interest rate you'll pay.

Besides knowing the total amount of those debts, you need to know how big an effort Prince Charming is making to pay them off. Is he making more than the minimum payments? And is he paying regularly and on time, so his credit rating isn't as pockmarked as the moon?

Remember that some of his debts can become yours. Let's say your boyfriend has an outstanding student loan. Let's also say he defaults on it and then files a tax return for which he is owed a refund. The government could withhold part or all of that tax refund. If you filed that tax return jointly, that garnisheed refund is at least partly yours.

You should know how much he earns and if he has ever declared bankruptcy. The point of this uncomfortable exercise is to figure out how your guy handles money. It doesn't mean that you should dump him if he isn't good with it, but you may decide that when you tie the knot, you will be taking over the family finances.

Sachs says you should also look at his past tax returns. "They show a lot more than what a person earns." It will give you a snapshot of investment assets, such as pensions and income properties, as well.

Also take a peek at loan applications, wills, credit card statements, property deeds and insurance policies. What if he balks at showing you these personal documents? "That would give me reason to worry," says Sachs. "I'd wonder what he is hiding, and if that's the attitude before marriage, then what happens after the marriage?"

And remember that this is a full-disclosure conversation: You have to be prepared to answer all the questions you ask and to show your lover all your financial documents, as well. So if your penchant for designer bags has left its mark on your credit report, fess up.

Have some money of your own
Even if you decide to pay your bills from a joint account, you should have some money that is yours alone.

Add up your shared expenses -- rent, utilities, groceries, etc. -- and figure out how much each one of you will contribute to them. "Have your pay cheque deposited into your own account, and transfer your portion of the joint expenses to the joint account once a month or however often you pay your bills," says Harris. Don't have all your income going directly into a joint account that you both access.

Establish and maintain your own credit
"It's unbelievable, but I see women all the time who have never had a credit card and, after a divorce, are starting from scratch," says Sachs.

They may find it difficult, if not impossible, to get a credit card in their own name, let alone qualify for a mortgage. How can you avoid that if you don't have any credit when you hook up with your dream guy?

"Have both your names on all credit cards and lines of credit. Then, get at least one card in your own name to establish an individual credit history," says Harris.

Sign a pre-nup
Think it sounds unromantic? Remember that marriage is a legal arrangement as well as a ceremonial one. "I think pre-nups should be standard," says Harris. According to Sachs, too many assumptions are made about what will happen if a relationship ends. "Having that discussion about assets and putting it in writing before marriage may save you tons of lawyers' fees later."

It's not just men who need to think about protecting their assets. You may make as much as your boyfriend now or, depending on your respective fields, you may have better long-term financial prospects than he does. "Just make sure that you are both protected. And no matter what, go to different lawyers," says Harris. You aren't trying to hoodwink anyone by doing this: "You want to devise a plan that will benefit both parties," says Harris.

"Taking charge and becoming aware has nothing to do with loving the person less," says Sachs. "It's important for women to be financially responsible, bottom line."

And as soon as you get married...
Make each other the beneficiaries of your RRSPs and draft new wills. Any will that existed before the wedding day automatically becomes null and void after the big day.

Jasmine Miller is a writer in Toronto.