Financial Issues for Couples

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Successfully merging finances, agreeing upon savings goals, and following a budget can greatly reduce marriage financial issues but issues can still arise and even threaten a marriage.  In fact, financial issues are the leading cause of divorce, and divorce can devastate both parties’ finances.  Stress over financial issues can make other problems worse.  So clearly this is an area that both partners should give full attention to.  Financial tensions and issues will inevitably arise so here are some suggestions for dealing with the most common ones.  These can apply to any couple, married or not.

  • Agree on a budget. (See the post on budgets)
  • Get honest data by each partner tracking their spending for a month. (Use a notebook, spreadsheet, smartphone app, or online tool like mint.com .)
  • Agree upon a dollar amount that exceeding requires mutual consent to spend.
  • Never go into debt without mutual agreement.
  • Don’t criticize small indulgences or spending within an agreed upon limit.
  • Compromise on goals and agree on specific steps to achieve them.
  • Convert nagging and fighting into a biweekly meeting to review and discuss financial issues.
  • One person may pay the bills, but collaboration is needed on knowing the family’s financial status, credit card amounts, debts, and investments.
  • Over-spending can arise from many reasons. One big one is ignorance of how the over-spending is harming both short and long term family financial needs and goals.  Do the bills together for a couple of months and then have the over-spender do them for at least several months longer.  Figuring out how to make ends meet can be a real eye-opener.
  • If it is the family’s saving goals that are threatened by over-spending, remember to “pay yourself first” by transferring your savings directly into designated savings/investment accounts with automatic transfers before savings can be invaded by over-spending.
  • Automate agreed upon solutions such as direct transfers of funds, bills, debts, or various savings accounts to meet specific goals.
  • Consider giving each partner a credit card or prepaid debit card with a fixed limit for which they can use and monitor their own spending for both necessities like gas and indulgences like fashions and golf clubs. The card’s low credit limit should cap personal spending for that month and not interfere with common expenses and goals.  With a “prepaid” card, you can load it up with a certain amount each month and use it as a credit card or withdrawals from ATMs.  This is a great way to control spending, but compare cards carefully to avoid any that allow overdrafts and big fees.  Either method should make it easier to control spending and meet the common budget.
  • If you disagree on investment decision, for example amount of risk, then divide the investment funds into separate amounts for different investment philosophies. This is the perfect area where partners can lead to a better team as one partner may moderate the other’s risk and the other partner can limit one’s over-caution.
  • Compromise as much as possible, agree to disagree when necessary.

About John Kimball

Over the past few decades, I have experienced most of these financial issues with both mistakes and successes. I sure wish someone had told me these things when I was first starting out. So many times I have cried out, "I want a do over!" when I learned a new financial lesson or tip. I aim to pass along to you the financial insights I have gained from experience, reading, analysis, and living the financial aspects of managing, saving, investing, and spending your money. I am an analyst with a large organization and happily married with two children on their way to an expensive college, no doubt. I read numerous financial blogs, websites, newsletters, magazines, newspapers, and books to bring you the latest news, insights, tips, and lessons combined with decades of experience.

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