If Valentine's Day came with an engagement ring or the patter of tiny feet is looming, your ability to talk money with your other half could be about to face the ultimate test.
In the world of "coupledom," there’s nothing like a major milestone – wedding, property purchase, dropping to a single income, separation, retirement, or an inheritance – to make money conversations challenging.
Approach your financial goals as a team and start by committing to transparency and honesty about the money coming in and going out.Credit:George Fetting
Throw financial pressure into the mix and every attempt to talk can turn heated. Or worse: money becomes a topic that is never discussed.
If you want to improve your ability to talk about money, what needs to happen?
Number one: start talking about it before you hit one of life’s financial pressure points.
For Serena Ryan and her husband Brendan, getting engaged in their 30s became a turning point.
The church that was their wedding venue of choice asked them to complete a pre-marital course. “It made us have those hard conversations,” says Serena.
Although already living together, they had kept their finances separate. Both worked full-time and had bought property individually.
The course forced them to be more transparent and talk about how they were managing their debts and savings.
“When you’re in that haze of love you’re not talking about all of that,” says Serena.
Ultimately, they discussed how they could merge their finances.
The biggest test of their ability to talk about money came when their son was five months old and they were living on a single income in Sydney.
“I’d gone from having an established career to being a stay-at-home parent. You’re working harder than ever but you’re not getting a pay packet and you have this perception that you’re not contributing.”
They recognised to keep guilt and resentment at bay they both needed to change their perceptions and think about what it was like to be in each other’s shoes.
Over the years, talking about money has become easier, says Serena. They approach decisions as a team and stick to some unofficial ground rules – no yelling; no keeping bills or unexpected expenses under wraps; and no telling each other what to spend money on.
On Sunday evenings, they review what’s ahead in the coming week for their bank account. And once a year, they discuss their mutual goals.
Their current focus? Eliminating debt – credit card and mortgage – as fast as possible.
Here are a few pointers to help your money conversations with a partner run more smoothly.
Transparency and honesty
It’s tough to set financial goals if you don’t know where your money is going.
Start by committing to transparency and honesty about the money coming in and going out. No hiding debts or ongoing obligations.
Set joint goals
Approach your financial goals as a team. Financial adviser Gianna Thomson helps couples look for common goals that motivate them to work together.
“We also work through different views about money and money values,” she says.
For instance, someone might like to be spontaneous with spending and enjoys taking investment risk. The other could be more cautious and loves budgets.
“Instead of focusing on the negatives of each other’s traits, focus on the positives and how to work together on a financial plan.”
Brenton Tong, managing director of Financial Spectrum, believes it helps to work out clear boundaries. For instance, how much can one of you spend without talking to the other? How much of your salary is yours and how much is joint money?
Make regular talk time
If you don’t know how to begin your money conversation, make an appointment with a financial planner or enrol in a financial education course together.
Set aside regular time when you are free of stress and distractions to check in with each other.
Communicating well means listening when the other person is speaking and reflecting back what you have heard.
Using “I” statements rather than “you” helps leave blame and judgement at the door. Keep the topic specific. For example, the big electricity bill.
Dr Karen Phillip, counselling psychotherapist, also suggests mentioning any problems, but keeping the focus on solutions.
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