Money and discussions about money can be some of the biggest stresses that couples experience. With the rising cost of living, people across all income brackets are struggling to make ends meet. We explain how to finance-proof your relationship.
Financial stress and disagreements about money are one of the most difficult issues for couples to resolve and a significant factor in many divorces. With the cost of living steadily rising, financial strain for many couples has increased in a way they never could have imagined.
Feeling in control of our finances provides a solid foundation for general wellbeing, so what makes it so difficult for couples to get themselves onto the same page when it comes to money management?
On paper, it’s as easy as adding up income and expenses and not spending more than we earn. But in reality, the process becomes complex and emotional through the different and unique meanings we attach to money.
10 ways couples can navigate the financial minefield
Talking about money makes many people feel uncomfortable, but having open and honest discussions about finances with your significant other is an important part of any long-term relationship, and may help to avoid potential conflict further down the line.
1. Break the taboo on talking about money
We discuss many intimate details of our lives with friends and family, but discussing finances is somehow taboo. We can feel left in the dark when it comes to knowing how to manage money – as if we haven’t been let in on some special secret. Feelings of shame and low self-worth can arise.
Learning how to talk with each other about money is the first step and takes time, focus, and effort.
2. Schedule regular money dates and ground rules for talking about finances
Experts suggest that couples should schedule regular money dates to discuss and review their finances. A private place is needed with no distractions including mobile phones.
This process might be challenging and will take patience. Approach what your partner has to say with respect and an open mind. Keep calm, listen, and try not to be judgemental.
Avoid labels like ‘irresponsible’ or ‘selfish’. Watch how you treat each other’s concerns. Do you dismiss them or do you take them seriously? This is not about one partner being right and the other wrong, but about finding a shared pathway of compromise that will lead to a positive outcome for you both.
3. Understand how you both view money
Reflect on how you were raised around money. How did your parents manage money? Were they frugal or did money burn a hole in their pocket? How did they talk about money?
Did they work together or did one control the finances? What worked and didn’t work for them? How do your beliefs about money lead to emotional patterns in relation to spending and saving? How do these beliefs contribute to conflict in your relationship? These are the kinds of questions you need to ask.
4. Overcome aversions to budgeting as a couple
There is no avoiding it – a comprehensive budget provides a realistic, sometimes confronting, picture of where your money is going.
Many online resources can guide you in creating a budget, whether it be downloading banking records into a spreadsheet or using a budgeting app.
Once you have the full picture, you can agree on your priorities and goals.
5. Allow yourself some discretionary spending
Many experts recommend allocating each partner a set amount of money to spend however they want each week or month. This can give each of you the freedom to pursue your own hobbies and interests, while still staying within the budget.
6. Turn a crisis into an opportunity
It can take a crisis for us to make changes that have been a long time coming, such as finally dealing with finances in a proactive way.
It also can be an opportunity to review some life goal priorities – is it your dream to save up enough to travel the world, or would you rather invest in a family home near the beach?
7. Beware of easy money
The easy money of credit cards and ‘buy now, pay later’ schemes lull us into viewing debt as normal.
But these schemes only work for ‘transactors’ – people who make payments before interest applies. ‘Revolvers’ are those who carry a credit card balance from one month to the next and are the major source of revenue for credit card companies. Try to avoid letting high-interest debt accumulate, and if you find yourself struggling to keep up with repayments, it may be time to look into a debt consolidation service or some professional financial advice on how to get back on top of things.
8. Acknowledge any financial imbalances
Money can create a power imbalance in your relationship if one partner earns more than the other, or if one partner doesn’t work at all.
The non-working partner might feel bad about not contributing financially, or the higher-earning partner might have concerns about how their income is being spent. Talk about your concerns together and tackle any issues as a team.
9. Be honest and open about your finances
It’s not uncommon for partners to keep secrets about money from each other, such as credit card debt. Now is the time to admit to anything you are hiding from your partner to avoid any future issues.
10. Use all resources possible
Check what government support and concessions are available. You could also research bank deferrals and payment plans and see if any of them are suitable for your situation.
If you’re struggling to open up about your financial situation, know you’re not alone. Financial concerns and difficulty talking about money are very common.