This article was published in the New Haven Register on October 28, 2017.
A 2014 survey by the American Psychological Association revealed that 31 percent of adults with partners experience money as a source of conflict in the relationship. Many other studies have identified financial issues as the No. 1 source of argument between couples.
If you’re about to get married, money matters may be the last thing on your mind, somewhere behind the wedding plans, children and gazing into each others’ eyes. But every couple should take steps to head off money troubles before they start. And the following suggestions could also help couples who walked down the aisle years ago:
Understand your beliefs. People have differing relationships to money and differing ideas when it comes to spending, saving, debt, investing, financial planning, charitable giving and retirement planning. It’s vital for couples to discuss their family history and past experiences regarding money issues. Talk about what your parents taught you about money. How do you each view savings? Do you plan ahead or spend it as it comes in? The idea is not necessarily to convince the other of your position, but rather to avoid conflict through understanding, accommodation and compromise.
Share the work. The APA survey showed that just 33 percent of Americans say their partner shares equally in financial decision-making and financial tasks. Some couples try to equalize matters by dividing tasks, with one handling the household expenses while the other focuses on investing. However, it’s easy to see that these different tasks can result in differing priorities and even conflicting actions. One person spends more than the other sees as fair, while the other person experiences setbacks in saving and investing the couple’s money, and a blame game can begin. A better way to handle financial tasks is to share all roles together. For instance set up a regular time to pay bills together and to discuss and handle other financial matters.
Set joint goals. Make sure you are always on the same page by agreeing on your goals as a couple and reviewing those goals periodically. Do you want to pay for your children’s education? Travel the world before you retire? Live below your means in order to retire early? Remember, it’s not enough to have vague goals like “We want to have a lot of money when we retire.” Goals must be specific, as in, “We want to retire at age 62 with $2.5 million in our retirement accounts, a paid-for home and no debt.” Then map out specifically how you’ll get there. A financial adviser can help show you the way.