About Elle Martinez

Elle Martinez helps families at Couple Money achieve financial freedom by sharing tips for reducing debt, increase income, and building net worth. Learn how to live on one income and have fun with the second..

Most couples marry their financial opposite, which can be a blessing or a recipe for disaster. Learn how you two can become a team and create a budget and money system you both love!

Marrying Your Financial Opposite

Did you know that 75% of divorced couples cite money as the cause of their marital issues?

With something causing that big of any issue, you’d think we’d try to become more proactive with making sure that finances

But for many couples, the conversations don’t happen.

There’s a tendency in a lot of marriages to not talk about money until something goes wrong.

The budget is broken or you’re struggling to hit a goal you made for the year.

One reason couples don’t talk about money is that they’re trying to avoid a fight.

Maybe they’ve had a blow-up in the past about certain spending and they rather not hash that out again.

Perhaps they couldn’t come to an agreement on something that should be simple like the budget.

This can especially be the case when you’re financial opposites.

However just because you’re financial opposites don’t mean you can’t work as a team with your money. In fact, for some couples, their differences became an advantage as they tackle goals like dumping debt, saving up for a house or investing in their future.

How do you get there though? How do you mesh those differences into strengths?

Scott and Bethany Palmer, The Money Couple are on the podcast today to chat about how to get started with talking about and working through your financial issues and goals.

They were financial advisors and noticed how their married clients were struggling with money. They’ve been focused since on helping spouses work with their different approaches to finances and become a team.

In this episode we’ll get into:

  • how money differences show up in our daily lives
  • understanding and respecting one another’s different perspectives
  • how to approach money talks so that they’re productive

Hope you enjoy!

Resources to Help You Merge Your Finances

If you’re looking to get better with your finances together, here are some helpful posts to check out:

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union. If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today!

We’ve been Coastal members for a few years have been happy with their services.

They also have competitive rates on their checking and savings accounts!

Meet Scott and Bethany Palmer

With 50 years of combined experience as financial advisors, Scott & Bethany Palmer (aka “The Money Couple”) have witnessed these conflicts firsthand.

After watching so many couples struggle over money, Scott & Bethany set out to find out why. After a decade of research with a Stanford scientist, they cracked the code to stop the money issues that so often lead to divorce.

They discovered that money “issues” aren’t really about dollars and cents — the real problem is a couple’s struggle to communicate about and agree on money.

They developed The 5 Money Personalities to help couples understand their own unique perspectives and behaviors when it comes to money, learn more about their partner’s money personalities, and better communicate in a way that builds rich relationships

Support the Podcast!

Thank you so much for listening to the podcast!

  • Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
  • Leave a review. Honest feedback and reviews make a big difference and gets the word out about the podcast. Leave your review on Apple or Stitcher.
  • Grab a copy of Jumpstart Your Marriage and Your Money. My book is designed for a busy couple to set up their finances in 4 weeks. Get tips and tools that have worked for other couples on their journey of building their marriage and wealth together!

Music Credit

Like the music in this episode? Our theme song is by Gentle Regime. Additional music by Lee Rosevere.

One of the most helpful things the two of you can do to strengthen your marriage and finances is to sit down and be open with one another about your money.

Unfortunately, many couples allow their fears about how wrong it could go stop them from doing this.

Building Wealth Together

This lack of communication can cause huge problems so if you haven’t already, take some time this week to discuss this with your husband or wife.

How do you get started? What should you discuss with the first talk?

Here are ideas that I believe can help both of you be productive and reduce money arguments.

BUILDING YOUR WEALTH AS A COUPLE

Be Upfront with Each Other

Honesty is the best policy when it comes to finances in a marriage. That means sharing all the relevant numbers and information with one another.

Financial infidelity can be emotionally devastating to a marriage.

Though not the most pleasant of activities, both of you will need to review the debts you have on a regular basis.

From college loans to car loans, credit cards and any other debt you have, it’s important that both of you know how much you owe.

This helps you create a realistic budget that will get you out of debt rather than having you two spin your financial wheels.

Create Goals Together

Okay so you know where you’re starting out from, but where are you two heading towards?

When creating financial goals, start off with dreams. After all, money is simply a tool. You can use it to achieve your dreams or you can waste it. What do you two want?

You can start off by creating a list of goals you two wish to achieve in 1, 5, and 10 years.

Think about what you value as individuals and as a couple.

  • Do you want to eventually own a house in the country or do you want a condo in the city?
  • Do you want to not lay roots and travel?
  • Do you like to have some gadgets or do you want to save to go have unique experiences?
  • Does either one of you want to start a business?
  • Do you guys want kids down the road?

Asking these questions can allow you to build something together instead of making it up as you go.

You also learn about each of your money personalities. Use this opportunity as a way to talk about the differences upfront.

Play to Your Financial Strengths

There are many aspects to managing your money: spending, investing, debt reduction, savings, budgeting, and more. Mostly you and your spouse will excel in a couple of those areas.

As a couple, determine what those areas are, assign roles and responsibilities, and encourage your spouse in his or her respective duties.

My husband is great at finding the best deals on electronics. He does the research and stays alert for when the price is lower than expected.

After we discuss the monthly budget, I take care of the execution of it. We review everything on a monthly basis.

Thoughts on Talking About Money

When did the two of you first start talking about money? How did it go? Any advice for the rest of us?

This post was originally published in June 2016. It has been updated in February 2020.

It’s not uncommon for a spouse to have a secret credit card or have more debt than they’ve told.

Financial infidelity can ruin a marriage. Learn how you can set up a financial system that allows you to be open and honest with your finances and work together with money!

Financial Infidelity in Your Marriage

Financial infidelity is more common than you think. 

A recent survey conducted for National Endowment for Financial Education® (NEFE®) revealed that two in five Americans admitted to committing financial infidelity

Add to that TD Bank last year found in their survey that some of the top financial secrets included hidden bank accounts, gambling and credit card debts, and unpaid student loans. 

It’s a wide net and it can be scary both as the spouse in the dark and sometimes the one doing it. 

This sounds weird for that second half, but here’s another thing I’ve noticed – at least in this community when I get the emails many times, it’s not because someone is trying to ruin their marriage or their finances. 

There is some breakdown that snowballs into something bigger. 

There are plenty of ways couples can start drifting with their finances and slowly shift towards that gray area and finally cross the line. 

For example, you can have one spouse is carrying all of the responsibility with finances, it can start to become a burden. 

They start making judgment calls and from there it can quickly get messy. Remember Travis and Vonnie? He handled the day to day finances and she preferred to let him run with it, not really looking into their numbers. 

Over the years, overspending and no accountability led him to have to admit to her that they were on the brink of bankruptcy

An extreme example, but it highlights a point – communication and some sort of system is key to making things work. 

So how can you two prevent that from happening? And if it has happened or is happening now, how can you regain that trust and team up with your finances?

In this episode we’ll get into:

  • Red flags or signs that financial infidelity might be an issue 
  • Working to regain trust after financial infidelity
  • Creating an open and transparent system for your money together

Resources to Help You Merge Your Finances

If you’re looking to get better with your finances together, here are some helpful posts to check out:

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union. If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today!

We’ve been Coastal members for a few years have been happy with their services.

They also have competitive rates on their checking and savings accounts!

Financial Infidelity Red Flags: More Than Hiding Money

A few years ago, I had someone send in a question about a surprise bonus they were expecting

At work today, I thought of your blog when we received our vacation paychecks which is what my company pays us for any unused vacation time.  

Normally, the policy is that you use the vacation time or lose it, but this year, management wanted to reach a certain number of earned work hours and decided to pay workers for unused vacation time, thus providing an incentive working towards the earned hours goal versus taking vacation time.

So when we received our vacation checks today, some of my co-workers were like kids in the candy shop because this is money that their wives won’t know about.  

Wives don’t exactly know how much vacation time their husband has used or accrued during the year.  So when the vacation paycheck were received in hand, some of my co-workers were thinking about electronic gadgets to buy or planning to go out and have a good time.

Since your blog deals with building financial freedom together,  Do you think this is alright when my co-workers splurge a bit with money that their significant other won’t know about?  Or do you think my co-workers should tell their significant others about their vacation checks and put it towards their financial goals?

Now would you consider this financial infidelity? 

According to some, financial infidelity is when one spouse is making significant financial moves without the knowledge of the other.

How would you define significant? 

There isn’t a hard and fast number as every couple’s situation and therefore finances are different. 

Financial infidelity can ruin a marriage. Learn how you can set up a financial system that allows you to be open and honest with your finances and work together with money! #marriage #money

But there are some things you can look out for. 

  • Secret accounts:  We talked about recently that some times spouses have a fun money account that’s typically used for purchases like hobbies and gifts. But separate doesn’t mean secret. Have you found statements for a credit card that you didn’t know about? Or if you have a joint credit card, have you been removed? These are bigger red flags for sure. And ones you need to address ASAP.
  • Missing Money: Does the balance on your joint account look much lower than expected? Another reason for both spouses to be a part of the conversation is so that there is accountability and an awareness of how the finances should be going. This can help you spot a problem when it’s smaller rather when it becomes a hige issue. 
  • Frivolous purchases: Not talking about an occasional small purchase here and there, but constant purchases that break the budget can add up to bigger problems. Those amazon deliveries, shopping bags around the house, are you aware of what’s being bought. 
  • Expensive hobbies: Again a purchase for a hobby in itself isn’t a red flag, but do they seem to have a spending problem with certain things? It can be that they spend all of their allocated fun money and start dipping into the joint account accounts.   It’s also a warning sign they have a compulsive spending problem. 

So if you see any of these what can you do? How do you start the conversations?

I want to share how one couple worked together to overcome financial infidelity.

Working Together and Regaining Trust

How can you move forward after one spouse has committed financial infidelity? 

Tai and Talaat McNeely, the talented creators behind His and Her Money had to deal with this situation. 

Years ago, as they were preparing to get married, they were doing all they could to get things on the right foot.

They got premarital counseling, they had conversations about money, their lives. Things were looking up for sure. 

Then Tai discovered financial infidelity. 

They were kind enough to share their story on an earlier episode and we do a deep dive into that, but I want to give a snippet here of how she found out, what talks they had to have, and the steps they took to deal and overcome this as a couple.  

Talaat McNeely: It was day one for me. We were having conversations about money ahead of being married and so our personalities came out.

I was the natural spender. I was reckless. I had a bunch of debt. I didn’t have a clue at the time. And on the other hand, Ty is a natural saver. She was working in financial services. Perfect credit. My credit was messed up. So it was kind of pretty apparent that we were on two different playing fields when it came to the topic of personal finance and we knew we had to figure it out if we wanted to win.

Tai McNeely: Yeah, we must mention, too, that in the beginning we sat down with our pastor to have premarital counseling and she asked all the right questions.

And he answered it just like I thought you should. And I answered just like he thought that I should. And we put our credit reports and we reviewed our credit reports.

So I knew that Talaat had some financial setbacks because clearly, his credit report showed that. However, we had a big bump just about three months prior to getting married where I discovered financial infidelity and I discovered that he wasn’t as transparent as he should have been before we got married about his finances because he was trying to handle it all.

He was trying to pay it off, pay down his entire debt before we got married. So, I mean, he was working more than one job. He was delivering pizzas and working a full-time job at the time. So I just thought I saw go-getter.

I saw someone that was determined and ambitious pumped about it. I was excited, but little did I know that he was working these multiple jobs so he can pay off this debt that I was unaware of before we got married.

Talaat McNeely: Well, I was I would say I was a reformed spender. And I was at the point as an individual to where I kind of had an awakening that the way I was going about money was all wrong. And I knew that I needed to make a change. And so I was at the point where I was ashamed of all of the debt that I had acquired. And here I am about to embark on a marriage, a new life. And I didn’t want to bring these old bad decisions that I made into the marriage. So my thinking was, well, I just got to hustle up and try to figure out how to get rid of the debt. And I can’t tell her this because she’ll look at me differently.

She won’t think I’m the guy that I built myself up to be. You know, when we were having these money talks, now that we’re engaged, you know, I meant what I was saying. I was starting to understand money a little bit better. But the problem was I was still had to deal with my past mistakes.

They were still right there in front of me. There were still bills and bill collectors that I’m dealing with. All that was there because of the decisions that I had made previously.

So my thought, which was an incorrect thought, was I can’t tell her because she won’t she won’t look at me and say she might not marry me because, you know, Tai said, she was all about and she’s all in when it comes to personal finance and I was a mess.

Tai McNeely: I felt like my world came down, came crashing. You know, I felt like trust. Like, oh, wow. Can I trust him? Because here it is. He was not completely honest with me. I just had a lot of emotions going on, especially in my mind on what to do until I realized, hey, he’s a good man. His money issues had nothing to do with him. How he treated me, he treated me like a clean, like my father always taught me.

So I knew that as long as we came together and went to court that, hey, we can do this. And if it wasn’t for the fact, then as I mentioned, that I saw determination in my husband. I saw that he was willing to change. I saw habits that he is changing. He was reading different financial books and stuff like that. It was very encouraging. So what we did, we had a long talk and we had to lay all our carrots out. We had to be completely honest with each other.

Now that some of the financial infidelity was uncovered, he had to tell me everything about his past financially, so I had to do the same. So once we maintain that, then we were able to work together and come up with a plan on how we can handle our finances. I’m the one that goes through our bank accounts, whether it’s daily or every other day and things like that. But we both sit down. We both do the budget. We have meetings, financial meetings together. We talk about expenses that are coming up. They need to get paid. But far as the one that’s going to the bank handling like the different transactions, I do that.

Talaat McNeely: One of the most important things that we did was we decided that we were in this together. We were married and we were one. There wasn’t any for lack of a better term, his and her money.

There wasn’t a there wasn’t any. He isn’t her debt. It was our debt. And Tai came one and shoulder did and said, you know what? It’s not your debt anymore. This is our let’s make a plan for us to figure out how we can get out of debt and that verbiage in that language.

It changed the game because it put us in show that we were going to be operating as a team. It wasn’t going to be any individuals.

You can’t operate individually in any area of your marriage and especially not your financial arena. You have to work together. You all have to play on the same team.

Creating an Open System for Your Money Together

There’s a lot of fantastic points to Tai and Talaat’s story.

First off, I want to mention that now they’re completely debt-free including their mortgage and they run a business together.

But that journey wasn’t easy. It took work on both their parts. Some things that stuck out to me when they shared their struggle and triumph. 

  • Sought outside help
  • Had regular conversations
  • Talaat owned up
  • Finances became transparent – maybe more so than they would have before, but regaining that trust was important to both of them
  • They decided to tackle the debts together. 

How can their story help you two create an open financial system where you’re working as a team? 

  • Don’t start off with blaming and accusations. 
  • Open up about finances. 
  • Pull in someone else to keep things objective
  • Process your feelings honestly. Forgiveness can be a process. 
  • Discuss mutual goals that you want to work towards
  • Spending Expectations and Accountability (Money Dates)
  • Seek counseling

Support the Podcast!

Thank you so much for listening to the podcast!

  • Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
  • Leave a review. Honest feedback and reviews make a big difference and gets the word out about the podcast. Leave your review on Apple or Stitcher.
  • Grab a copy of Jumpstart Your Marriage and Your Money. My book is designed for a busy couple to set up their finances in 4 weeks. Get tips and tools that have worked for other couples on their journey of building their marriage and wealth together!

Music Credit

Like the music in this episode? Our theme song is by Gentle Regime. Additional music by Lee Rosevere.

Merging finances is more than combining bank accounts. It’s working together with the good, bad, and awkward, including dealing with debt.

Today we’re discussing the legalities of who’s responsible for what, credit scores, and how to dump debt together!

Marriage and Debt

Marriage is about two lives coming together. It can be a wonderful feeling to know you have someone to watch your back through thick and thin. 

Part of coming together is dealing with your finances together and for many couples debt is a chunk of it.

Between credits cards, car and student loans, and maybe a mortgage, the two of you could be starting your marriage in the negative

As a couple you know paying down is the way to go, but you have other concerns on your mind. If one or both of you come in with debt, who’s legally responsible? 

What about the debt you take on after you’re married? What if you two have drastically different credit scores? How will that affect plans that you have – perhaps buying a house down the line? 

Which is why I’m happy Leslie Tayne is here today. Leslie is an attorney who specializes in debt resolution. With almost twenty years of experience, she helps clients get debt relief and resolution. 

She’s sharing her expertise on how debt can affect your finances and marriage.

In this episode we’ll get into:

  • Who’s responsible for what legally when it comes to debt
  • Dealing with common situations that can come up when one spouse has a higher credit score than the other
  • Ways to talk about debt and work as a team to get rid of it.

Let’s get started! 

Resources to Dump Your Debt Together

If you two are ready to pay off your debt, here are some handy resources to check out:

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union. If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today!

We’ve been Coastal members for a few years have been happy with their services.

They want to help you achieve your biggest goals faster and as a team!

Support the Podcast!

Thank you so much for listening to the podcast!

  • Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
  • Leave a review. Honest feedback and reviews make a big difference and gets the word out about the podcast. Leave your review on Apple or Stitcher.
  • Grab a copy of Jumpstart Your Marriage and Your Money. My book is designed for a busy couple to set up their finances in 4 weeks. Get tips and tools that have worked for other couples on their journey of building their marriage and wealth together!

Music Credit

Like the music in this episode? Our theme song is by Gentle Regime. Additional music by Lee Rosevere.

Expecting a tax refund this year? Learn how you can enjoy it now and set yourselves up to build wealth!

Want to Get the Most from Your Tax Refund?

You can watch this week’s video here or you can read below the highlight and grab some resources to make the most of your tax refund!

3 Smart Ways Your Tax Refund Can Boost Your Wealth

Tax refunds can be a great opportunity to set yourselves up for an awesome year financially.

I’m going to give you three ways that you can do this.

Build Your Emergency Fund

The first way you can boost your wealth is making sure you have a financial cushion.

That’s right; make sure that you have a starter emergency fund set aside that stashed away for any hiccups that can come up this year.

On another marriage and money tip episode, I shared how to calculate what’s the best number for you.

As a general rule of thumb, though, if you haven’t already please make sure you have at least $1,000 tucked away.

This can take care of car repairs, one of you gets sick, or if you have an emergency with the bills your savings can help you smooth out those rough patches without messing up your monthly budget.

We can’t control a lot of things with what happens to us but the better prepared we are with savings, we’ll be less stressed.

Expected a tax refund this year? Learn how you can enjoy it now and set yourselves up to build wealth! #taxes #family #money

Pay Down Your Debts

the second way you guys can make this tax refund go so much further is by paying down or paying off your high-interest debts.

Yep, I’m talking credit cards. If you have them you probably already know that they are basically quicksand with your monthly budget.

You’re not going to see that money again and if you’re only making minimum payments there’s going to be a constant drain on your finances.

Go ahead knocked down a few of those with your tax refund!

Invest in Your IRAs

Finally, the last money savvy way to use your tax refund is to contribute more towards retirement.

Now did you maximize your contributions with your IRA this past year?

Don’t worry if you haven’t. You can make up for it with this year’s tax refund. If you haven’t already and open an IRA and start contributing towards retirement.

Ther are some wonderful options I have listed in the resources section. The earlier you start contributing the more compound interest works in your favor.

Resources to Check Out

There you have it three ways that you can use your tax refund to build wealth.

If you’re getting ready to file your taxes or are waiting for your tax refund to come in, here are some resources that can help you make the most out of it.

Too Big a Refund? Boost Your Paycheck Instead

Just a reminder if you’re getting a huge tax refund double check why.

It could be that your withholding way too much on your paychecks. While we all love having a nice big lump sum, it would be better for you to have that money in your paychecks sooner rather than later.

Bonus Tip

If you’re looking for other ways to save and build some wealth look at your 401(k) especially if your employer offers a match.

Not only will investing feed your retirement fund, it will lower your taxable income now – double win!

And if you need help with your 401k, please check out blooom. They’re an incredible service for less than the cost of Netflix.

They can manage your 401(k) based on yur needs, help minimize needless fees, and you have access to a certified financial planner if needed.

Oh, and while I do want you to be smart with your money, don’t be afraid to celebrate and have some fun.

Talk it over and see if you can set aside 10-20% of your refund towards a vacation or something that you guys have been saving up for.

Thoughts on Tax Refund Plans

I’d love to hear from you about your plans. How many of you have received or are expecting a refund this year? What are your plans for it?

Getting on the same page with finances can be tricky. Learn how you can diffuse money fights and start working as a team!

Why We Fight About Money

No one wants to have money be this source of stress in their lives, not in a strictly financial sense where you’re worried about the bills and definitely not in your marriage. 

And yet, it is usually listed as one of the top reasons spouses have fights

And if you have debt? It’s even more of an issue. In one study, with couples who carried debt, they found that 48% of those with over $50,000 of debt listed money as stress point compared to 23% of those with less than $10,000.

It makes sense, right – if you have the more debt you have, the more your current income is tied up to pay it. 

So then couples usually want to come up with some plan to pay off their debt, but they hit a wall when it comes to making and executing that plan. There’s too much tension and blame to get things rolling. 

But if you’ve listened to this for a while, you’ve heard stories of couples who have overcome some huge issues like massive amounts of debt, being hit with financial infidelity, or being on the brink of bankruptcy yet they managed to come out stronger paying off massive amounts of debt.

How do you get there though? 

Through better conversations about money and more. It’s not easy to get started so today Traci Philips is going to share how we can better communicate. 

Into this episode, we get into:

  • Better Understanding Where Our Spouse is Coming from with Money
  • Common mistakes couples make when talking about money
  • How to work through disagreements to diffuse a potential money fight

Let’s get started! 

Resources on Marriage Fights & Finances

Want to learn more and become more productive with your money dates? Here are some resources to check out:

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union. If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today!

We’ve been Coastal members for a few years have been happy with their services.

They also have competitive rates on their checking and savings accounts!

Meet Traci Phillips

As a Leadership & Performance Strategist, Traci assists her clients in identifying core challenges with her unique strengths in translating both verbal and non-verbal language. 

If you want to find out more and work with her, please check out The Innate Coach!

Understanding Where Our Spouse is Coming From

Money can be a hot topic in relationships, even if you two have similar dreams and goals. We’re coming at finances, kids, life with different perspectives and histories.

And the difference can be huge.

But for most of us, it’s something we don’t acknowledge until we have a problem.

The budget was broken, again.

And talking about money then is harder because we’re focused on the immediate problem which in turn can make communicating harder because we’re locked into a mode of fixing the symptom instead of addressing the bigger issue not having a financial system that reflects our priorities and values as a couple. 

In fact, we tend to skip that first step – understanding where our spouse is coming from. 

Traci Phillips: The first thing I find is where we struggle oftentimes is that when we’re communicating at all, we usually are only thinking about the lens through which we’re looking out into the world or where we’re thinking about the particular topic. So this is, you know, finances. You know, it’s oh, how are we? How are we identified? What is our relationship with the concept of money?

Elle Martinez: So start off there. How does your spouse view money? How do you view money?

Traci Phillips: And then talk about why it’s an operational pattern based on what they experienced in their home growing up right around their parents, maybe their parents’ relationship with money and how their parents communicated around money are the choices each parent made around money.

I mean, half this stuff isn’t even ours and we’re still operating from this place. And because we aren’t curious about trying to figure out why we operate this way.

We never figure out where those you know, those points where we’re going. We become blocked in our communication, where they even come from and help what we can do about them.

Elle Martinez: And another point to keep in the back of your mind as you’re talking about this is just to make sure that you’re coming in this with genuine intentions of listening.

What I mean is you’re not in a rush to correct the problem or try to offer solutions immediately, but that you’re just listening to what they’re saying and mentally making notes about their opinions, their ideas, and their viewpoints.

Support the Podcast!

Thank you so much for listening to the podcast!

  • Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
  • Leave a review. Honest feedback and reviews make a big difference and gets the word out about the podcast. Leave your review on Apple or Stitcher.
  • Grab a copy of Jumpstart Your Marriage and Your Money. My book is designed for a busy couple to set up their finances in 4 weeks. Get tips and tools that have worked for other couples on their journey of building their marriage and wealth together!

Music Credit

Like the music in this episode? Our theme song is by Gentle Regime. Additional music by Lee Rosevere.

Tax season is here and for many families that means receiving a tax refund. Did you know that last year the average tax refund was $2895?

That’s a nice chunk of change that you can use to pay down debts, build up savings, or invest with some leftover to have a small splurge.

But is having a big tax refund a good thing?

Many personal finance journalists and writers have very strong and opposing opinions on them.

Let’s look at both sides and see if we can find the best solution for you and your family.

Why Tax Refunds Rock

Are you expecting a big tax refund? Find out how you can set yourselves up to keep more in money in your pocket going forward! #family #money #personalfinance #taxtips

Let’s start with why getting a big tax refund is a win.

A large amount at once can be psychologically empowering rather than smaller ones spread throughout the year.

If you have credit card debt, for example, having a couple of grand to use may be push you to just go ahead and get rid of that debt (or at least lower it considerably).

You may also choose to be conservative so you get a refund rather than getting hit with a penalty.

Being self-employed my income varies year to year and can fluctuate during seasons. I prefer playing it safe with my estimated taxes.

It may not be a solution for you, but it works for us.

If you’re looking to file your taxes and getting the biggest refund, check out TurboTax. We’ve been using them for years and have been happy.

How You’re Not Getting Further with Big Tax Refunds

The other side of the arguement is big tax refunds are basically an interest free loan to the goverment.

A refund is simply you overpaying what you owe and waiting abouta year ot get it back.

No one is going to care about your finances as you do, so having that money to spend as it is available is practical.

If you automate your finances, having more money in your paycheck can allow you to pay down your debts or save up faster.

So while I don’t think you should feel guilty about getting a big refund, I do think it’s smart to review and update your withholdings so your paychecks are bigger.

You think that small amounts don’t really do much, but if you set up automatic transfers, you can easily reach your financial goals faster.

Make the Most of Your Money

Are you expecting a big tax refund? Find out how you can set yourselves up to keep more in money in your pocket going forward! #family #money #personalfinance #taxtips

I think the larger factor in determining whether or not a big refund is a win is how you use it.

Big refunds can be a wonderful way to improve your finances in one swoop.

  • Pay Down/Off Your Debts: Getting rid of your high interest debts is a huge win. You’ll then be able to use what you had been making as monthly payments into something more productive.
  • Boost Your Savings: If you don’t have an emergency fund, this would be a quick way to start one. Stash your money in a high interest savings account at your bank or credit union.
  • Invest in Your Future: Yes, you should definitely consider putting more into your IRA, but don’t forget that there are others ways you can invest. Signing up to get a certification for an in demand skill is a smart investment.

With so many choices, you two should sit down and see what works best for your situation. You may want to split it up between goals or go all in on one.

Spending a portion of your money on something fun isn’t bad, but just do yourself a favor and make sure you priortize so you make progress on your big goals.

Thoughts on Tax Refunds

You know how I feel about them, but I’d like to hear from you – what do you think about big tax refunds?

Are they a big win or would you rather have them sprinkled in your paycheck?

This episode was originally released in January 2016. It’s been updated January 2019.

This post may contain affiliate links. Please read my full disclosure for more info.

Want to make taxes this year go smoother? Learn four easy ways on how to set up and review your finances to have some big money wins this year!

This week on the podcast we talked about getting ready and maybe just a bit excited for tax season.

Naturally, most people don’t jump for joy when they’re thinking about taxes.

However, there are a few things you can now that will not only make the process less stressful but help you hit your money goals faster!

How to Make Filing Your Taxes Easier

I want to share four key takeaways I got from preparing this week’s episode as well as a money tip you can use this week to make taxes just a little less stressful.

Review Your Past Tax Returns

One of the easiest things you can do to get an idea of how to maximize your tax credits and deductions is to review your past returns.

If you use an online program like TurboTax, you can quickly pull it up.

Things to look for include:

  • which deductions and credits you took (and which you were close to qualifying for)
  • go over your income sources (can you build any of them up?)
  • your retirement contributions

Let me give you an example so you can see how this can benefit you.

Let’s say that one of you has opted to stay at home with the kids. Have you considered taking advantage of the Spousal IRA for the stay at home parent?

You could be saving now with contributions because it would lower your taxable income. You’d also be helping yourselves later since you’re investing.

Go Over Your Work Benefits

Related to your past tax returns, when is the last time the two of you went over your benefits?

There are some fantastic tax-advantaged accounts you could be contributing towards like your 401(k) that can make a huge difference.

Now unless you have a qualifying event like getting married or having a child, you can’t make certain changes to benefits like health insurance until open enrollment, but you can start looking at the possibility of adjusting things.

In a less stressed, time crunch environment, you can run the numbers and see if you have the best health insurance plan for you.

You may be in a good spot or you may find that you’re spending either too much out of pocket or in premiums for the plan that you have.

For us, when we looked at the numbers and our family’s health situation, it made more sense to switch to a high deductible plan.

That’s not only lowered our health care expenses, but we’ve redirected that money into a health savings account, which offers some tremendous tax benefits.

So please go over your benefits to make sure you’re maximizing them!

Have a Plan for Your Refund

One of the good things about getting a decent refund is that you have a lump sum, but that also means you need to be smart with how it’s used.

Do yourself a favor now and come up with a plan for that money.

Whether it’s bumping up your financial cushion, paying down debt, investing, or donating, create a budget for it. You’ll be more likely to hit your financial goals faster.

And please don’t forget to set aside some money for fun!

Money Tip of the Week: Central Spot for Your Tax Documents

Finally, for your money tip of the week, it’s something that’s helped us – small but effective. Make sure you have a central location for all the documents that are going to be coming in.

Between the two of us, we have many different accounts and they come in at different times, some early, some. To be honest, late.

You probably are dealing with the same thing.

It’s easy to lose them if you’re not having a specific spot. So whether it’s a folder or a tray, keep it in that area.

And if you use software like TurboTax, what you can do is get started with the documents you already have saved and then updated as more documents come in.

You can tackle your taxes bit by bit. So it might be less stressful with that approach.

If you’re looking to not only optimize your taxes but get your finances squared away and want tailored advice, work with a financial planner.

And if you’re in the Triangle area of North Carolina, please check out our sponsor Coastal Credit Union.

Don’t forget we also have a Facebook group – Thriving Families -that’s focused on helping one another out with our financial goals. Hope to see you there!