Financial Planning Tips for Couples

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Published by Ryan Cooley, Associate Wealth Advisor

 If you’re like most couples, you likely have arguments about money. Almost 70% of married or cohabiting couples admit to fighting about their finances,[1] and disagreements about money are one of the top causes of divorce.[2]

It’s no surprise that managing your money can be stressful, and adding in a second party can make matters worse (especially if you and your partner aren’t on the same page about how to handle money).

Let’s look at why it’s so hard for love and money to peacefully coexist, as well as some tips on how to manage your financial planning as a couple.

Everyone Has Their Own Baggage

Before jumping into some tips on how to help you avoid financial friction, let’s look at why money causes so many issues in relationships.

It’s no secret that finances tend to stir up plenty of emotions and cause stress in everyday life, so couples may try to keep the peace by keeping mum about money. In addition, everyone has their own opinion on how to manage money, and most of us also have a unique financial personality. Some of us are savers, some are spenders. Some of us may be conservative, while others are free spirits. These differences can cause friction and discord, which then affects all other aspects of the relationship.

But no matter what the statistics tell us, money doesn’t have to be a stress point in a relationship. Here are a few simple strategies that may help couples avoid financial friction.

Be Honest

Unfortunately, honesty regarding money isn’t a guarantee in a relationship. According to a CreditCards.com poll, 32% of people in a serious relationship commit financial infidelity, either by hiding debt, credit cards, or bank accounts or spending more than their partner would be okay with.[3] It’s important for both partners to offer full disclosure of their finances and be open about expenses, regardless of whether you’re married or you live together, have joint accounts or have separate bank accounts. You and your spouse should be aware of how you spend your money, especially when it comes to significant expenses, loans, or ongoing fees. By maintaining an open line of communication regarding spending habits and upcoming bills, you may be able to avoid financial arguments.

Time it Right

Since conversations about money are often emotionally charged, choose a time to talk about your financial situation or make decisions when both of you are at your best. Don’t wait until the end of a long, stressful day or right before you have to walk out the door. It’s also important to be preemptive, having discussions to set boundaries and expectations to avoid future problems. In other words, don’t wait until one of you splurges on a new TV or you go over budget on a vacation to set limits on spending.

Cater to Your Strengths, But Work As a Team

Most often, one spouse acts as the Chief Financial Officer of the household, managing all bills, budgets, savings, investments, and insurance policies. However, it can be helpful for both partners to understand their financial situation. If time allows, sit down together once a month for a financial check-in to review credit card statements, account transactions, and other bills and check for any possible errors. Ongoing input from both partners will strengthen your relationship and create a true partnership.

Find What Works for You

You don’t have to go far to find financial advice, but not every system or philosophy will work for your relationship. Glean ideas from experts, family members, or friends, but be flexible, allowing yourself to experiment and find a financial framework in which you both can thrive. Don’t be afraid to experiment with different methods of budgeting, saving, or debt payoff, and remember that as life changes, you may need to adapt your finances to your new circumstances.

Reward Yourself

Set aside a portion of pocket money that you and your spouse can each spend every month on something you love, whether it’s a massage, a round of golf, or a steak dinner. Along with saving for long-term goals, set small objectives you can reasonably accomplish each month and celebrate your success.

Bring in a Third Party

Sometimes the best way to ease money tensions is to work with an objective third party, whether that’s a financial professional, a marriage counselor, or both. A financial professional can work with you and your spouse to review your financial landscape, identify any gaps in your insurance coverage, assist you in establishing short-term and long-term goals, help you stay on track, and provide professional and knowledgeable advice.

Although the topic of finance can occasionally cause tension, money doesn’t have to become a constant source of concern in a relationship. Invest the time to address spending habits and savings goals, uphold transparency regarding purchases, and communicate effectively.

How We Can Help

At Jacob William Advisory, we go far beyond just managing your investments. We help you understand the behavioral impact of money and work with your family, including your partner, to help make sure everyone is on the same page. If you’d like to discuss your family’s finances, contact our office by calling 410-821-6724 or emailing info@jacobwilliam.com or schedule an appointment at https://www.jacobwilliam.com/insights/#contact.

About Ryan

Ryan Cooley is an Associate Wealth Advisor at Jacob William Advisory, a wealth management firm whose sole mission is to serve their clients’ needs beyond their expectations. Ryan has a military background as a U.S. Army Infantryman, and he applies the values and character traits he learned through his experience to his role as a financial advisor. To this day, Ryan is passionate about veterans’ issues and holds a seat on the Advisory Board for Operation Second Chance and is a lifetime member of the Disabled American Veterans organization. Ryan obtained his bachelor’s degree in economics and his MBA from the University of Maryland. Outside of the office, Ryan enjoys spending time with his wife, Germaine, and their two wonderful children. He currently resides in Urbana, Maryland, and loves to fish, hunt, cook, watch Maryland Terrapin sports, and cheer his son and daughter on in all of their activities. To learn more about Ryan, connect with him on LinkedIn.

[1] https://www.aicpa.org/news/article/relationship-intimacy-being-crushed-by-financial-tension-aicpa-survey

[2] https://www.marriage.com/advice/divorce/10-most-common-reasons-for-divorce/

[3] https://www.creditcards.com/statistics/financial-infidelity-cheating-poll/

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