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What’s the greatest predictor that your relationship will go bust?Communicate about money early on in a relationship and avoid the pitfalls of financial arguments down the road.
It’s not problems in the bedroom, secret lovers or conflicts over raising kids. If you want a chance at “till death do us part,” then you better know how to talk about cash.
More couples argue about money than any other topic. If these arguments begin early in a relationship, last longer than other disagreements, and are left unresolved, they will more than likely lead to divorce. And the problem isn’t always about the lack of cash – even wealthy couples have marital issues over finances.
Your best chance of survival is to address these 3 key issues:
1. What does money mean to you? Some people view it as a means for security and they focus on saving. Others see money as a definition of success and an opportunity to climb up the social ladder. And then there are those who spend it spontaneously and struggle tracking where there monthly income goes. It’s all about communication: take a minute to write out your personal money philosophy and share it with your partner.
2. I’ll show you mine, if you show me yours – share your credit rating. Some things you don’t want to share regarding your past, but this shouldn’t be one of them. Have a frank discussion about money – income, saving, debt and investments – to help insure a stable financial relationship.
3. What will be yours, mine and ours? Couples often don’t earn the same amount, particularly if one is an at-home caregiver. Discuss how to divvy up the finances, so bills get paid, savings increase and each partner gets their own (probably small) slush fund.
I wanted to take this a step further and share a few tips for maintaining marital and financial harmony, so I turned to the worldwide respected clinical psychologist, Dr. Phil. We could probably debate the title, but for time purposes, let’s just go with the TV Show on this one.
13 Money Tips for Married Couples
- Talk openly about money before you marry – transparency and financial agreement are vital to paving the way to increasing marital success
- Define shared financial goals – current spending, long term investments and everything in between from vacations to college funds
- Remain in agreement about your financial plan – one partner may want to shift gears and oh, maybe buy that classic Corvette he’s wanted for years. Be sure to discuss if this is in the cards or if it’s a purchase saved for when the kids leave home.
- Share costs – equal doesn’t mean the same here, but equitably divide costs so one partner doesn’t feel overburdened with the budget.
- Communicate about what you need – know the difference between need and want. This often translates into power in a relationship, so focus on what’s really at hand.
- Combine long term assets for maximum growth and safety – joint ownership on your home, for example, helps protect you from creditors.
- Take advantage of tax benefits – you may pay a bit more going from “single” to “married” status on your taxes, but in the long run you’ll end up saving money
- Respect each other’s money skills – couples rarely have the same financial expertise. One may better handle the day-to-day bills while the other long term investing.
- Support each other through ups and downs – take the pressure off each other, particularly when one partner experiences a significant change in income. Ultimately, you’re still in an “us” situation.
- Don’t give up on communication, even through separation – hiding income may appear to offer sweet revenge, but remember, thoughts such as “I’m going to ruin you” really mean “I’m going to ruin us.”
- Perform regular financial check-ups – even if you create a financial plan, regularly revisit it and expect to update it as time passes
- Get real about how much money you have – don’t live a fairytale. Set a realistic budget and don’t worry about what The Jones’s are up to.
- Maintain separate accounts – even if it’s just a small account for discretionary funds; you’ll feel financially independent having a few bucks to call your own.
People often underestimate the commitment (and potential stress) in merging two lives together. The reason we fight most about money is because it’s the most measurable. Sure, compromises also need to be made when it comes to issues of time, space and affection, but the checks and balances of money is a conversation you should bank on.