How Couples Can Stop Arguing about Money
In a perfect world, love and money would always coexist in harmony. Unfortunately studies show that incompatible approaches to finances are second only to dishonesty as a cause of stress among couples. If you and your significant other are at loggerheads over money, taking these three steps can help put you both at ease:
1. Talk about your feelings
Open dialogue about money is critical even if it turns out to be a painful topic. The conversation is crucial to building a successful financial partnership. Ideally people should discuss the subject of money with potential mates before tying the knot. But it is never too late. Share your first memories of money and the impact it had on you in childhood. What are your attitudes toward credit and debt? Do you pay a bill the day it arrives or several months late? What role does money play in your goals and dreams?
Since money is such a charged issue, your financial heart-to-heart should take place during an emotionally neutral time — in other words, not in the middle of an argument or in response to a particular event or action. Rather than focus on one partner’s shortcomings or negative behavior, look at the big picture. Discuss your individual and shared goals and come up with a long-term financial plan.
The bottom line: Listen to each other, do not play the blame game or escalate the discussion to an argument and if the topic drifts, bring it back to the long-term plan.
2. Devise a simple money management plan
Another way couples can head off conflict is by making the family finances as efficient and transparent as possible. Start by sitting down with your partner and figuring out what comes into and goes out of the household each month and how much of the excess cash should be allocated to retirement savings, a college or vacation savings fund and the emergency cash cushion.
Once you figure out where the money needs to go, automate as much as you can by signing up to have monthly bills paid directly from your bank account. This single step can go a long way toward ending monthly arguments about who should have paid which bill.
The bottom line: Even if one person takes responsibility for managing the household finances, both partners should know where the money goes.
3. Keep some finances separate
Different people have different appetites for risk. Rather than always splitting the difference, reserve some areas where each partner maintains complete control. This can be as simple as budgeting a set amount each month for each partner to spend or save as he or she sees fit. Another option is to use your individual retirement savings plans as places to satisfy your own risk tolerance without checking in with your partner.
The bottom line: A little "mad money" can keep everyone sane.
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How much are you spending? Take time to gather your records and make a budget. Our budgeting calculator can help you get started.
