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As a couple, what’s your relationship with money?
Hi Couple Money Readers,
I’m Jamal from The Mill Street Times.
Like you, I care about the important things in life: my family, loving what I do for a living, and talking about money.
I’m super excited to come to you with some tips that I learned while watching Crazy, Stupid Love.
This is such a great movie that I bought it on Blu-ray (not frugal, I know) because I am such a fan.
The movie centers on Cal Weaver, played by Steve Carell, whose marriage is turned upside down.
The marriage wasn’t ruined because of financial infidelity, but another form of cheating, the intimate kind.
Many tend to focus on cheating of the sexual nature. But since I’m finance minded I think we should focus on financial infidelity. This movie reminded me of how money is an integral part of relationships and the importance of how we communicate on this subject.
As a couple, what is your relationship with money? Does it differ your individual relationship with money? Have you made a budget together? Have you been, or are you, unhappy with your money situation? Are you facing financial ruin because you haven’t spent enough time managing your finances?
Whatever the question, you need to know what your relationship with money is as a couple.
Going from managing your own finances to managing finances as a couple is a huge leap.
No longer are you budgeting, spending, and thinking about money for yourself. Now you have to think about someone else’s wants, needs, and desires.
This can be a very difficult transition. If not managed right, this can lead to many issues financially and emotionally down the road.
Don’t let a David Lindhagen (you have to watch the movie to get this reference) come in and destroy your relationship.
These five steps will set you and your partner down the right path to financial stability.
1. Talk About Money
Let’s start off on the right foot here. You MUST talk about money.
You don’t have to ask for the person’s credit score on the first date even though some suggest that approach. However, this should be a conversation early on in the relationship.
This is important because you have to be fair to yourself. If you are someone that doesn’t deal well with debt, or doesn’t like to spend a lot, you might find it hard being with a super spender or someone who is hundreds of thousands of dollars in debt.
Another benefit to talking about money early is that you get the big elephant out of the room.
When the two of you are further along in the relationship you will know how to approach the conversation.
Make sure that you bring the subject up as an opportunity to get to know each other better and not coming as a way of accusing the other of spending too much or being cheap.
2. Bank Accounts
You may want to have this conversation early on with your partner, especially if you’re married.
Do you want to keep separate bank accounts, combine them, or both?
Talk out all of the scenarios and reasons for each way that you can go. Find out the best way for both of you and then make it happen.
Sorting out what bank accounts you will have as a couple may seem easy, but it can be a tough conversation to have once you get into the details.
How will the paychecks be divvied up? Will you transfer a certain amount to the joint account every paycheck? If you don’t want a joint account, who will pay the bills?
Who’s better at handling money? Which one of you wants the responsibility of paying the bills each month and on time? This leads us to step number 3…budgeting.
If you are married or completely committed to one another, it is probably time to manage money as one. In order to be financially stable, you need to come up with a budget.
This requires you to think about how you want to manage your combined finances. Hopefully, this isn’t the first time you’ve talked about money because you addressed step 1.
Creating a budget will help the two of you get comfortable with planning for your financial future with one another. In order to create a budget you should think about a few things.
First, what are OUR shared monthly expenses? This includes rent, utilities, groceries, household expenses, etc ¬– anything that you are sharing on a daily basis. Document each one of these expenses and allocate a dollar amount to them.
Second, you should approach “spending on yourself” money. This is VERY important.
Couples should always feel free to spend a little money on themselves. This way you don’t feel trapped or not in control of your own money.
This may not work for everyone, but I think that it’s helpful to include in a budget.
Third, determine your savings goal and how much you allocate to that every month. Having stress about how much you save for retirement can be huge.
Stop this anxiety by committing to saving for retirement early.
Finally, create a miscellaneous section, because things happen and it’s good to include a section that takes care of the unexpected.
4. Spend Money on Each Other
First and foremost, it’s important to spend time with one another.
Nothing can replace the excitement and joy of spending time with your partner. Therefore, this step doesn’t have to mean money, but sometimes spending time with your partner includes spending money.
This can be buying a really nice spice that you’ve wanted to use for a special dinner recipe. It could be a ticket out to the movies or a quick trip to a state park. Spending money on your partner doesn’t have to be a lot.
It just shows that you care about the other person and you wanted to treat them to something special.
This keeps the relationship fresh and less stressful when it comes to talking about money as well.
5. Be Honest, Be Fair
No one likes to feel like they aren’t being treated right, nor do they like to think that they are being treated unfairly financially.
When going through each one of these steps, make sure that you are being fair to one another.
Are both of you getting the same monthly stipend to spend on yourself? How much is each person allocating to the bills? Is it disproportionate? If so, are both of you comfortable with this?
Make sure that both of you are honest because if you’re not, problems will bubble up over time and cause more issues than if you addressed them right off the bat.
These steps will set you on the right path for having a healthy relationship with money as a couple.
Going through these steps will take time and may be stressful at times. It’s important to remember that each person has his or her own relationship with money.
Be kind, caring, and understanding when approaching each one of these steps. Sometimes people may be ashamed of their finances while others are super proud of theirs.
Work with each other. In the end, you will be financially stronger and happier for having these conversations.
Oh and just remember you decided to be with this person and that you really like them, heck if you’re going through all these steps you may even love them!