You’ve tracked your spending, created a budget, worked on ridding yourself of debt, and are well on your way to a financially secure life. Now you’re ready for step four…
Having “the TALK!”
Now there are several different “talks” but the one we are talking about today is the ‘money talk’ with your partner. Talking finances with your partner may not be your idea of a shared romantic moment, but communicating openly about how you manage your money is a crucial part of having an honest and trusting relationship. It’s fairly common knowledge that arguing about money is the leading cause of divorce in the U.S., and no one wants to be the next statistic. Unfortunately, though, people often grow defensive when discussing the ways they choose to spend their money. How, then, can two partners have a calm, productive discussion about money? I mean, let’s be honest, I do not like talking about finances with my husband. And we pretty much agree on all our financial goals and how we can get there. It’s just that I pay all the bills every month and make sure everyone is taken care of at all times and sometimes it seems like there should be more money leftover than there is and then I want to get defensive about it and I don’t want to explain the past 6 months expenses in detail! UGH. It would probably be better for us if we did all the finances together weekly or at least bi-weekly. Then there would be complete transparency and when I say, “Do you really need another supplement or vitamin or protein powder?” He would understand why I am asking that!
I have put together a few tips on how to help you in this super-important conversation.
- Plan the discussion in advance
It’s never a good idea to bring up a potentially explosive topic without warning. Instead, broach the topic to your partner a few days before you want to have the “Big Money Talk” and ask if you can have an open discussion about money sometime soon. This way, you’ll each have time to prepare the details you’d like to talk about, and you’ll both be ready to focus on the conversation without distractions.
- Start with a vision
Instead of starting the conversation by bringing up a time your partner overspent or wondering aloud why your better half doesn’t seem to be saving enough for the future, start with a vision you can both share. For example, you can talk about how wonderful it would be to take a luxury vacation to the Cayman Islands, or how you’d love to start saving for a home. This way, you are communicating a shared dream and putting a positive spin on your money talk, which will set the tone for the rest of the conversation.
- Listen carefully to your partner
You may be the more responsible, or the more detail-oriented partner, but it’s still important to listen carefully to what your partner has to say. Your partner will have their own ideas about money management, and you may be surprised at the insights they have to share into your own spending habits or expensive vices. Not getting defensive is one of the biggest keys to having a successful conversation. Do not be accusatory. We all could save money in at least one area. For my husband it would be on his ‘health and nutrition stuff’ and for me it would probably be shopping or eating out with friends. Are any of those things bad? No! Not at all. But if we have goals and dreams, then maybe some of those things need to be slowed down.
- Talk openly about sharing expenses and savings
At a certain point in your relationship, you may decide to share expenses, split them evenly and have each partner cover different expenses, and/or to pool your savings. Whether you’ve already reached that level with your partner or you plan to bring up the topic now, be sure to talk openly about the way you feel so you have a better chance of avoiding future resentment. For example, if you earn more than your partner, should you be splitting expenses evenly? Can one partner take additional financial responsibilities, such as paying the bills, in lieu of contributing an equal amount of income to the pot? If one partner goes over budget, will they be responsible for patching up the difference by contributing more money? All of these questions, and more, are important to discuss up front to help prevent future blowups and/or hurt feelings. At this time, consider linking one of your accounts or opening a shared account at Abilene Teachers FCU. We’ve got convenient checking and saving accounts to suit every preference. Just stop by and ask how we can help. Juston and I have split our household expenses for about 11 years now. He makes more than I do and he pays a bigger portion of the bills. Now know one tell him but we should probably look back at the way things are split because I have gotten many raises since we started this and I could pay more of the bills but that can be for a future discussion!! But rather you have one checking account and pay all the bills from it or you have separate accounts and split the bills, there is not one size fits all or right or wrong way. You have to figure out what works best for you and your household.
- Consider having a slush fund
Sharing expenses and a budget can be liberating in a partnership, but it can also feel constricting. Sometimes, you just want to splurge without having to explain the purchase to your partner. You may also want to spend money on a surprise gift for your partner without them knowing you’ve just dropped a large sum of money on an expensive purchase. Having a slush fund, or money set aside for your personal “just for fun” spending, can help you maintain a sense of independence and keep some of your purchases private. You can keep this fund in a separate checking account under your name at Abilene Teachers FCU. This is something my husband and I do, plus a little more. One of my favorite things about banking at ATFCU is that I can do a modified Dave Ramsey ‘Envelope System’ using my savings and checking accounts. Juston and I are both primary members and on each others accounts. That being said, we are not on every account of each others. I have 7 savings accounts and 2 checking accounts under my primary account and Juston has 3 savings accounts and 1 checking account. We are able to name each account and disperse our money to each account as we please. We have savings accounts for an emergency fund, Christmas, vehicles, vacation, kids, plus several others. One of those (under my account) is labeled ‘ME’. Guess what… that savings is for each time I get paid I add a little to it and then I have it to get my nails done or buy a new outfit or I can save it up for a girls trip or to buy something nice for Juston. Your partner can be a legal owner on one or all your accounts. That is up to you.
- Set up a weekly or biweekly time to talk money
No, you don’t need to have the Big Money Talk every week, but it is a good idea to touch base about finances once a week, or once every two weeks. You can talk about recent purchases, big expenses that are coming up soon, surprise bills and more. Setting aside time to talk about money will keep the stressful money arguments out of your everyday conversations. It will also keep so much time from going on that then it is overwhelming all the things you need to talk about or go over. By both of you being on the same page on a consistent basis, then there are no surprises for one person when their heads were in the clouds thinking everything was fine and you are trying to keep everything together amongst the chaos.
You did it! You had the money talk with your partner, and you are closer than ever. Well, I don’t know if that last part is true or not (especially if there were some hard moments) but I do believe it will help you become closer by working on these things together and often. Be sure to stick to your commitments and to bring up any money issues that may arise during your regular money talks for continued harmonious collaboration about all financial matters.