MoneySense 2nd Quarter 2018 Family Finance
Discussing Money as a Couple
There was this study from the University of Utah where they interviewed thousands of couples. They were asked how often they disagreed over chores, in-laws, spending time together, sex, and money. Fast forward five years later, and this time they were asked if they were still married. Here’s what they found: couples who fought mostly about money were more likely to get divorced.
There are many sources of financial disagreements. But these five differences are the most common:
DIFFERENT MONEY PERSONALITIES. In general, we have two money personalities: some of us are savers and some of us are spenders. Of course, if both of you are savers, you’ll agree in most financial decisions. The same if you’re spenders, you’ll get along for sure (although this can be a problem if your spending gets out of control).
It’s when you have different money personalities that you will have misunderstanding and conflict in your marriage. You’ll start to think your saver wife is just a killjoy and doesn’t want you to be happy. Or you’ll think your spender husband is so irresponsible.
So how do you deal with having different money personalities? The solution is quite simple.
You and your spouse should think of yourselves as being one unit, one team. Even if you have different personalities, if you resolve to communicate and compromise because you’re in this together, you can make it work.
DIFFERENT ACCOUNTS. A very common question for couples when it comes to money is if you should have a joint bank account or if you should keep separate accounts. Typically, expenses are split between the husband and wife. For example, the husband pays tuition, utility bills, and household salaries. The wife pays for groceries. Is there a problem with this arrangement? Not necessarily.
This strategy comes with fair warning: somewhere down the road, this could be used as a weapon when you have an argument. You start comparing who’s doing more, who’s paying more.
One strategy to deal with this is to visualize that your money really is just ONE INCOME. You can have different accounts, but it goes to ONE POOL. Once it’s in the pool, doesn’t matter anymore where it came from. It’s already the family’s money that’s paying for all the bills.
DIFFERENT INCOMES. Another issue is when you have different incomes. Or only one spouse is working. This becomes a problem if the higher earning spouse starts to develop an entitlement mentality.
To change this mindset, learn to share privileges equally. No one gets more just because he or she earns more. Also, sacrifice equally. If you think and act as one unit, there’s no his or hers.
DIFFERENT SKILLS. The fourth area is having different skills. It’s not common for both spouses to be good with money management. It’s more common to have only one who is better at handling the finances. And this is fine.
This only becomes a problem if the one in charge takes all the control and the one who delegates abdicates responsibility. If you’re the money manager, make sure you update your spouse about what’s happening to your finances. If you’re not, don’t be clueless. Ask for updates. Make sure you have access to all your accounts.
DIFFERENT PRIORITIES. Men and women spend differently. You and your spouse have different interests and different priorities when it comes to spending. Having different priorities can lead to resentment. What you think is important may not be important to your spouse. Vice versa, what your spouse values more may not be as a priority to you.
The solution is just a small tweak in your budget. For your small personal expenses, you can give each other a monthly allowance without having to account for each item. Don’t stress yourselves out.
For big-ticket items, you have to sit down and discuss what your dreams are individually and as a family. Then try to find ways to make yours goals happen.