This Valentine’s Day, whether you’re treating your significant other to a romantic dinner, staying in with your kids, or buying some last-minute chocolates – I encourage you to use this holiday focused on love to show a little of that love to your finances. Sound boring? Well, maybe. But hear me out. Money is a common cause of stress in relationships, and if it is not discussed… it can start impacting more places than just your wallet. According to AICPA research, nearly three in four (73%) married or cohabitating Americans say financial decisions are a source of tension in their relationship. Of these, roughly half (47%) admit this tension has negatively impacted intimacy with their partner. ¹
I recommend couples practice open and honest communication regarding money, spending habits, budgeting, and savings plans. Here are a few tips to start you on the right path to strengthen your relationship to avoid future stress.
Commit To Transparency
One of the most critical areas in any relationship is good communication. I’m not a relationship expert, but just like in everyday life outside of relationships, whether it’s your job or even friendships, communicating openly and honestly can quickly help you understand your partner to alleviate any future misunderstandings.
It is crucial to create open communication channels and build a sense of trust in your spouse, so they feel comfortable discussing all cash flow, spending, and debt. For example, both of you might have come from different socioeconomic backgrounds or have different opinions about managing money. Some people are savers, and some people are risk-takers. You get the idea. You don’t have to agree on how each dime is spent and managed, but it’s best to discuss your opinions early in your relationship so you understand each other’s viewpoints. Here are a few questions to ask when breaching this topic early on in your relationship:
- How did your parents handle money when you were growing up?
- Did your parents discuss money values when you were growing up?
- Did you take out student loans, or was your education paid for? If applicable.
- At what age did you get your first credit card?
Save, Save, Save
If you are already married, you most likely have a system in place for how you operate your bank accounts, whether independently or jointly. But, if you’re starting out in your relationship or marriage, it’s essential to sit down and establish how you plan to operate your accounts that hold your money and, from there, create a savings plan. You might even take it a step further and create a budget plan you both adhere to and strive to maintain. You can read more about that here.
A savings and budget plan are critical areas in a financial plan because the lack of one arguably makes the other vital areas unsuccessful. . There are many different types of savings plans. Here are a few you should discuss and have a plan in place for:
- Retirement accounts – IRAs, 401k)s, etc. Discuss how you handle funding retirement if you both work and have eligible employee benefit plans.
- Savings Accounts – Joint/or separate, whatever your preference–make sure you’re committing to honesty and transparency with your saving accounts.
- Special Situation Planning – Your family might have exceptional circumstances that require additional planning and funding, like unforeseen medical costs, paying for a wedding, caring for an aging parent. Your financial plan should include this area, so you’re prepared for the unexpected.
Set Goals Together… & Have Fun!
Goal mapping and prioritizing your money are essentially the sole purpose of financial planning. We often say that YOUR goals are OUR goals. By setting goals together, you and your partner will most likely strengthen your relationships because it encourages good communication, maybe some healthy competitiveness, and allows you to focus on something together that excites you. Perhaps it’s saving for a new family car, saving for a vacation, or working toward building your dream home.
Based on your current income and after building your budget, you might realize that you still need to cut back on spending or work on a new plan to pay down existing debt. This is common, and there’s no need to panic. It might be a situation where we sit down and revisit your financial plan and ensure there’s a solid plan in place so I can equip you with the necessary tools and advice to achieve your goals.
Final step – have fun!
Money, saving, and budgeting are often surrounded by stress, but it doesn’t have to be. Make sure you’re keeping some “me” money if you can treat yourself (something as small as a monthly date night), so you don’t get bogged down on working to save and budget for those bigger goals. And by setting goals together, it’s encouraging a more team-focused approach in your relationship, and hopefully, it will pay off in the future through you achieving your goals!