This article was last updated on March 17
“What’s hers is hers and what’s mine is hers – that’s how we share our money!”
Many arguments about money occur because couples haven’t clearly spelled out their expectations about investing, spending or saving. Instead, each member of the couple simply assumes that the other shares his or her views on the subject. Unfortunately, this is NOT the case with most couples and why monetary issues can cause such rifts in relationships.
To keep relationships financially sound, it’s important to bring your “money” feelings and views into the open. You may take it for granted that you need to put aside some money for emergencies, while your partner believes that saving for a rainy day is less important than enjoying the present (the Cheapskate vs Frugal argument). Or, you may want to pay your bills as soon as they arrive while your partner likes to wait until the last minute to pay – which can lead to annoying late fees or charges. Talking frankly about your differences can keep disagreements from turning into major battles. Some important issues to discuss include the following:
– Your overall views on money. Just as each person in a relationship has a different personality, he or she may also have different attitudes toward money. One of the most common causes of tension is that one person is a “spender” and the other is a “saver.” It can be hard to avoid friction if you disagree strongly on the value of having a nest egg or indulging in occasional luxuries. But if you talk about your differences, you may be able to work out a few compromises that will keep the tension to a minimum.
– Your big financial goals. Most couples have a variety of long- and short-term financial goals. Yours might include saving to buy a house, getting out of debt or building a retirement fund. However your partners could be completely different like “Take a vacation”, “Find a new Job”. If couples have disparate goals or do not support the other person’s goal, then chances that they will be achieved are slim. You can avoid some problems by discussing and prioritizing your goals relative to the goals your partner has. At least once a year, sit down together and decide what your biggest priority as a couple will be for the year and beyond. Then agree on a plan for achieving what matters most to both of you.
– Your plan for day-to-day money management. In addition to a long-term plan, every couple needs a system for managing money on a day-to-day basis (budgeting). In many relationships, one person assumes most of the responsibility for tasks such as bill-paying and balancing the checkbook. In others, both people take turns or divide the regular financial tasks (see who does the finances in your household). The specific approach you choose isn’t as important as making sure that you discuss how you’ll handle these responsibilities. Resentment can build if one person takes on essential responsibilities without the support of the other. If one of you has agreed to handle your finances – and it’s clear that this approach isn’t working – it’s vital to find a solution before the problems get out of hand.
These are just some of the big money issues couples face. The key is to communicate and for both parties to have a clear understanding of their partners expectations and desires. Then it is up to the couple to both compromise in order to reach a mutually beneficial balance.
In the next post on this topic I will look into how couples can avoid financial disagreements when it comes to money and finances.