Q: My wife and I are buying a retirement/vacation home with our life-long friend.

We haven’t approached the discussion of “who pays what percent” of the mortgage, taxes, utilities, insurance and furniture. Do you have any suggestions on how to have this conversation and perhaps some reference materials we can look at?

A: I’m wondering why you and your wife and life-long friend have put off having “the talk?” The most important thing you can do is to open a bottle of wine and discuss the hard-core logistics of the purchase: who pays what, how costs are shared, who takes care of the place, who gets to use it and when, what happens if someone’s kids or grandkids want to use it, how you will hold title, etc.

Then, you need to talk about what happens when someone dies, or decides he doesn’t want to own the place anymore. What is the exit strategy going to be? If one partner is going to buy the other partner out, what will the formula be?

For example, will you calculate in the expected real estate agent’s fee if you buy your partner outright?

After that, the three of you should sit down with a real estate attorney who will draft up a partnership agreement that spells out the arrangement you’ve crafted.

The best thing you can do to safe-guard your friendship is to make sure all of these issues are dealt with now, before you’ve made an offer on a property.

Sept. 7, 2006.