How to discuss money with your partner without coming to blows
Written by Philip Howell-Williams on July 05, 2015.
In a recent post I mentioned a US survey which revealed that 38% of people admit that financial discussions cause tension in their relationship. That’s an incredibly high percentage to be bickering about an absolutely key element of living together. Being able to talk about your financial situation openly with your partner is as important for the health of your relationship as it is for the health of your bank balance. So how do you go about it without a discussion heading towards a row?
Here are my five top tips for keeping your finances in order whilst maintaining harmony in your household:
1. Have a monthly household meeting
Yes, it’s not as fun as going out for dinner or sitting down to watch a film together but you do need to set aside time once a month to go over your financial affairs à deux. Whilst direct debit payments mean that often you don’t physically need to do anything to pay your bills, you should be keeping track of what is going out on a regular basis, and, of course, what is coming in. It is crucial that you both know what the cost of living for the household is, what debts or savings you have and what you are spending per month on a regular basis, both on necessities and on luxuries.
2. Choose your time carefully
Announcing that you want to discuss finances when your partner has just got in from a stressful day at work is not a good idea. Schedule a time in advance when you know you will both be feeling calm, relaxed and fresh.
3. Act as a team
Different couples work their finances in different ways. You might keep your earnings separate and each contribute an agreed amount to a joint account for household expenses, or you might adopt the ‘what’s mine is yours’ policy and throw everything in together. However you choose to operate, you both need to be clear on what your agreement is and stick to it to avoid nasty surprises and resentment.
4. Discuss your financial goals
Keeping track of money going in and out of your household is just one element of a financial plan. It is also important to map out your financial future together and that means determining your financial goals. In addition, you need to think about how to protect your wealth against unforeseen circumstances via medical insurance, life insurance and critical illness cover and what will happen to your assets when you die.
5. Go and see a financial planner
I would advise every couple to get help with their financial planning from a qualified professional. Having a third party to assist can not only help you focus on any issues which are particular to you and your partner and propose personalised solutions, but can offer a subjective point of view which often helps to diffuse tension.
If you would like to explore how a financial planner could be useful to get your household finances on track, I’d love to hear from you.