Yours, Mine & Ours: Ten Tips for Talking to Your Partner About Money

Wedding RingsThis can be one of the most difficult of all unions but it doesn’t have to be. Since I started thinking about writing this blog I seem to keep having a recurring thought…If I had only known. This is true on so many levels that I toyed with the idea of making that the name of the blog. It might have something to do with the old saying that with age comes wisdom. As I write this I am reflecting on the fact that my 30 year wedding anniversary is coming up this May. If I had only known then what I know now how different our life could have been and what a different money story we would have to tell. I suppose this is true for all of us although it’s a luxury we never get to enjoy.

As part of the wedding preparation we were required to attend pre-marital counseling and participate in a series of meetings with a church sponsor couple. Ironically the husband of our church sponsor couple was a banker. He shared how difficult money matters can be and proceeded to counsel us on how not to make common money mistakes. But what he didn’t do was teach us how to talk to each other about money. Our money histories could not have been more different. Despite our best intentions we made one financial misstep after another.

Today the family unit takes many different forms. There is no right way or one size fits all solution. The important thing is to talk about what’s important to you, listen to the concerns of your partner and agree on an approach. Money challenges can create for a toxic environment in some homes but it doesn’t have to.

Money is one of the least discussed subjects in a relationship. For many couples it’s easier to hide it under the rug, avoid the elephant in the room and live in denial. I’ve heard it referred to as money infidelity. Have you ever cheated on your partner with money? Have you even hid money or purchases from your partner or spouse? Money secrets are common. To get the ball rolling in more positive direction I recommend creating a safe zone. Agree to get it all out on the table and move forward in a positive direction, together, without judgment and blame. I realize that is easier said than done.

Be honest with yourself about your own expectations. When families agree that one spouse is going to be a stay at home parent this is particularly important.  If you have always been independent it may be a shock to suddenly be in a situation where you are dependent on someone else financially. It may be equally hard for the working spouse to feel as if they are the sole provider. Another similar challenge is when one partner brings significantly more assets to the relationship.  How will you handle this? This is a delicate balance and requires a thoughtful approach.

I have seen people financially devastated because they have allowed themselves to become entirely financially dependent on their partner. I always recommend that whenever possible the working spouse funds an individual retirement account for the stay at home parent in order to provide them a pool of funds dedicated to their own retirement needs. The working spouse more than likely has access to a company sponsored retirement plan but the stay at home spouse does not. A lot can happen over the years and this provides more equal footing. From my point of view it is extremely important.

In recent years we have found that difficult economic circumstances are actually bringing couples closer together in some situations. When you enjoy a healthy dialogue about money matters you can work as a team. It’s a way to agree on joint goals and work together with a common purpose. When you share the same vision for the future this becomes easier.

No matter what your situation is the following is my best thinking in regards to best practices about talking to your spouse, significant other or partner about money. This comes from my own personal experience, learning what works and what doesn’t from friends, family and clients and lots and lots of research.  I hope you will find it helpful. In my last post I covered how important it is to talk about your plan for raising financially savvy kids. Putting things out in the open and anticipating events before they occur is by far the best approach. Some of these techniques will be equally helpful when talking with parents and kids.

  1. Schedule regular family financial huddles where you agree to discuss your financial life together. I recommend a bi-monthly meeting, more frequently in times of financial stress. Be disciplined about this.
  2.  Practice active listening skills. If you don’t know what this is then learn. There are lots of available resources. Ask clarifying questions to make sure you understand what the other one is saying.
  3. Decide if you are going to pool your resources, maintain separate accounts or possibly a yours, mine and ours approach. Agree on how much or what proportion is agreeable to fund the household bucket.
  4. Think about what you want your money to do for you and share this with your partner. Get clear on your individual and joint financial goals.
  5. Agree on how much spending money you can each have discretion over if any. It’s important to feel as if you can spend without having to answer for every penny. At what point do you need to discuss it first… is it anything over $50, $100 or $500. This certainly depends on your income level but it’s also about principal and sharing common goals.
  6. Recognize that emotions often run high during periods of stress. Agree to take a break when tension escalates. Take a breather, reflect on what has been said and agree on when to come back together. Do not let too much time pass.
  7. Agree on a savings strategy. This goes back to sharing common goals. Determine how you are going to work for common goals such as retirement or that vacation house. Then ask yourselves how you will handle personal wish list items such as that new mountain bike or those new red high heels.
  8. Be gentle, be kind, and be respectful. Use the language of love. (I overheard this at a restaurant recently and it stuck with me! I will admit that I am not as gentle as I could be sometimes.)
  9. Use your money huddle time to discuss money challenges in regards to the kids and/or parents. If you expect to have financial challenges with your aging parents come to agreement earlier on about how you will handle these. Gain a clear understanding of each other’s situation, family dynamic and any expectations.
  10. Create a balance of power in regards to money. It’s not fair that one spouse should shoulder all the responsibility. It’s also important that both spouses are knowledgeable. A power imbalance can have two very negative aspects, one spouse gets all the blame and the other one feels helpless which only adds to the stress.

Start the process slowly. Consider starting with “Wouldn’t it be better if we started making financial decisions as a family? I’d like to help” Another approach is to let your partner know that you want to learn. “I’m concerned that I don’t know enough about our financial situation. I know I haven’t always made time for our finances but I’d feel better if we shouldered the responsibility together.”  It will be anything but easy. I promise you it’s a better approach and you will be on more financially sound footing as a result. Get started today.

If you missed the rest of this series, start here.

photo by: allyrose18

About Mary Jo Lyons

Mary Jo Lyons, CFP® is a registered assitant with extensive expertise in designing financial strategies to help clients achieve their financial goals. Have a financial question? ASK MARY JO!

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