Money can’t buy you love, but it can buy a huge rift between you and your significant other. It’s no wonder that money is such a fierce topic with couples. In America, sadly our divorce rate ranges between 40-50% for first time marriages and a staggering 60% for second marriages. Ask any therapist and they will tell you that the two most argued about subjects…well sex, and you guessed it, money. Here are 6 tips to end your money fights as a couple.
It won’t come as a shock to you that Tip #1 is something that I preach about all the time- Goals. It’s really important to set clear goals as a couple, otherwise you will definitely ram into each other (and not in the good ways), time and time again. Goals should be short and long-term and you should always make sure they are detailed. For instance, if you are saving for a trip to Hawaii next year, you need to know how much it will cost you, how much you need to set aside each month, and what you are willing to sacrifice on to get there. This is super old school, but creating a vision board, you know the one with all the cut out pictures on it, is a really good idea.
I’m not saying it’s a cure-all, but visually seeing your goals is important. Have you heard the story about Jim Carrey writing a million dollar check to him and then posting it where he could see it? Not 2 months later did he score his first million dollar role.
Tip #2 is something I like to call the Money Huddle. You know how sports teams huddle together before a big play? Couples should do the same. When you are having disagreements or trying to decided whether to buy a big-ticket item and are at odds, huddle up for a few minutes. Remember your goals; remember that you are playing on the same team and set a time limit for a resolution. I usually think if you can’t solve it in 1 minute, then it’s time to go back to the drawing board.
Now the money huddle can be used for good purposes too. Setting aside some time each month, maybe 15-20 min, to huddle up and make sure you are on track is quite positively one of the best money moves you can make as a couple. Are you on track for your goals? Did you get a bonus and you need to strategize about what to do? Is there a life change happening you need to plan for? Maybe it’s just a time for a quick high-five congratulating yourself on some good money teamwork.
If the money huddle doesn’t work, then sometimes you’ve got to get back to basics and call for an official Adult Time Out. Yes, Tip #3 sounds silly, but honestly it works. Sometimes you’ve argued so much that you don’t even know what you are arguing about. Or, even worse, mud-slinging starts to take place and you find yourself having out-of-body experiences. We’re promoting unity here…not division.
The adult time out is used when you can’t simply come to an agreement. Instead, you agree to go to separate corners, sides of the house whatever it takes to clear your mind and think through the argument. Take a piece of paper and pen in the time out and write what you really want to say, what your frustration is. Then when you come back together, you can calmly look at what each other wrote and work to solve the money issue.
Tip #4 takes us back to the dreaded “B” word. Remember in our previous podcast that we weren’t going to use the word, “budget”, but some other term that is a bit more tolerable. My husband and I like to call ours the itinerary because we love to travel.
If you are trying, or you tried, to do you finances separately, stop, please. I can tell you from personal experience that this doesn’t work. You can’t have two people managing the same account. That is recipe for disaster. You need a point person. Now, this person doesn’t have to carry the load of the finances, but it’s one person in charge of making sure everything gets paid on time each month, and that you are on budget.
What you need to do together is create the budget, and spend about 5 minutes every month reviewing it. It’s a “this is where we are at”, meeting. Budgets lie, so just creating the document is not good enough. You need to spend a few min at the end of each month figuring out what went right, and what went wrong.
While we’re on this subject, I am going to take some liberty here to tell you what I’ve seen work as far as accounts. I come from the school of having One Central Account for ease and fairness, and that’s Tip #5. Whether you earn more, or your significant other earns more, that shouldn’t mean that you get to spend more or less each month. Seriously, you wouldn’t believe the kind of unfair advantages I’ve seen working on financial plans for people.
Now, having separate spending accounts for your fun money is cool and works well in most situations. Why be in partnership if you don’t want an equal partner, right? Joint accounts are for paying all the things you have to pay, and for savings. If you must separate, create different accounts as high yield savings accounts and put whatever money you have for savings in there each month- but keep it fair.
If you aren’t married, then you do need to take some caution in combining accounts. You should make sure you are in a VERY steady relationship and that you both have access to the accounts. In fact, that is a good tip for everyone. Make sure both of your names are on all joint accounts always.
Lastly, and this is one of my favorites, Tip #6 every couple should have a “Don’t Ask, Don’t Tell” spending limit. This is a preset amount that you can spend every month without any questions being asked.
Ladies, how many times have you sneaked a package in the house so your significant other won’t see? Yes, we are all guilty. With this little line item though you can avoid that tiptoeing.
As a couple, come up with an amount that you both can have each month that won’t kill your budget. Make it realistic, but fun. I’ve worked with a ton of couples, married and in relationships, and I’ve had to play therapist more than financial planner. I promise you, no matter how hokey some of these tips sound, they bring a lot of unity and clarity to your finances as a couple.
In fact, if they can elicit a good laugh as a couple then even better. Laughter really is the best medicine. Money is tough, relationships are tough, but you can make it. Money should never be a divider.
We’d love to hear from you. If you have any questions or if you use any of these techniques, let us know at firstname.lastname@example.org, and follow us on Instagram @millennial_money.