How to Talk With Your Partner About Money
So you and your partner are serious enough that you need to talk about finances together. In the words of Douglas Adams, “Don’t panic.” Talking about finances with your partner is widely feared, but frankly, it doesn’t need to be. If done well and regularly it can actually bring the two of you closer together. After all, if financial troubles are one of the leading predictors of marital instability, shouldn’t the opposite hold true? We’ve put together these five friendly tips to help you and your partner to successfully sit down and discuss your finances without getting into a fight.
Set a regular time for financial talks
This sounds exceedingly simple but it really is important. All too often we can find ourselves distracted by phones, emails, kids, TV, and so on. In order to take a serious look at your finances together, it is vitally important to create a time when you both can be distraction free. Treat this date and time as important too, because if you keep finding ways to procrastinate that shows your partner that you’re not that serious about tackling this important topic.
Also, remember that finances are an ongoing topic in your lives. One meeting isn’t sufficient. You need to be able to talk with your partner on a regular basis about your joint finances. Maybe, in the beginning, the talks are more regular, until you get goals aligned and a budget in place. But after a while, you may find you only need a monthly budget date with your partner. By having an established, regular discussion time set up it takes a lot of the stress out of the situation.
Be open and honest with one another
Once you’ve started the conversation about finances, it’s very important to be open and honest. No one is perfect, and it is important to show your partner that you are willing to be transparent about your financial history. This starts with showing your assets, income, and debts, but also extends into examining your own monthly spending habits. Going over your monthly credit and debit card statements together and asking your partner to circle or highlight anything they have questions about demonstrates your willingness to be financially transparent. That way, when the two of you go to examine their financial situation, you’ve already set the stage for what is expected.
Additionally, we need to remember that each of us came from a different family upbringing, and the way our families handled money drastically influences how we learned to manage money. By being open and honest about why we spend or save the way we do provides your partner insight into you as well. Not only does this help financially but it can also bring your relationship closer.
Starting with a monthly or even weekly budget may be a good starting point for future conversations. This helps keep you both honest and accountable for spending and saving. It also builds successes: if you can stick to a budget for a week then it’s easier to accept that you can stick to a budget for a month, and so on. Just accept that habits, including spending habits, don’t change overnight. It may be several months before you come to a workable monthly budget and that’s ok.
Don’t be judgmental
There is an old parable that states, “Judge not, that ye not be judged.” Being judgmental is a surefire way to create tension and open you up to judgment as well. No one wants to be criticized, especially where money is concerned. You probably do not want to be judged on every single cent you’ve spent, and neither does your partner. Remember that financial planning is about taking where you each were separately and finding a path to move forward on together.
In order to really do this, we first need to be honest about our own mistakes. If you can preempt criticism and judgment by openly discussing where you feel you may overspend or where you could save more, it demonstrates humility and thoughtfulness. Opening yourself up by acknowledging your imperfections shows a great deal of trust and willingness to work on correcting these mistakes.
If your partner looks afraid to open up remember to be a considerate and caring listener, not a judgmental one. Look them in the eyes and hold their hands while listening. It demonstrates that you truly care about what they’re sharing. Listen first and then when they’re done talking, instead of judging ask probing questions to help each of you understand the situation better. For example, what are their feelings about spending versus saving? How do they feel about saving as opposed to paying down debt? But during all of this, remember to keep calm so you don’t derail the conversation. If you need to, take a deep breath and mentally count down from ten. It may sound silly, but it truly helps to de-stress.
Set realistic goals together and plan how to achieve them
Financial planning is about setting goals and making plans for how to achieve them. The easiest way to start on this path is to ask your partner what their goals are. When do you want to retire? Where do you want us to be in five years? Ten years? Twenty years? Once you start this conversation about personal goals, you both can start to plan on how best to go about achieving these dreams.
Remember tips #2 and #3 above. You need to be open and honest about your goals and to not judge your partner’s goals. Don’t frame your goals in a seemingly negative light, such as “we need to get your spending in control” or “we need to pay off your mountain of student loans.” Instead try to be specific on what kinds of things you want to accomplish, such as “I’d like to pay off the car so we can start saving for a house,” or “I’d like to find a way to get away from high-interest credit cards.” By stating goals with a clear objective that are lacking in judgmental phrases, you can make realistic plans about how to achieve them.
When discussing these goals, look for those that coincide with one another. These will be the ones that shape future plans and discussions. If you both want a house in the future, you’ll shape your plans around saving for a down payment and mortgage payments. If you decide you both like getting new cars every few years then keep those in your plans. Focusing on the commonalities helps to keep the stress down and promote realistic goal-setting.
When the inevitable differences arise, try to plan practical ways to deal with them. If one of you is a spender and the other loves to save, then perhaps you need a joint account for joint expenditures and separate accounts for personal expenses. Also, set limits on what can be spent without having to consult each other. Maybe you feel that twenty dollar expenses are fine, but anything over that you have to talk with the other partner about. Maybe that limit is fifty dollars, or a hundred. It all depends on your budget and tolerances.
Do something together afterward to unwind, but don’t blow the budget
Even if you both remain open, honest, and judgment-free, having financial conversations can be stressful. So, we recommend that you do something fun, romantic, or relaxing together after your financial talk. It helps to reinforce the “we” of the relationship, could capitalize on any newfound or reinforced closeness, and frankly celebrates successes while releasing pent-up stress. Just don’t go overboard and blow your newly crafted budget. Cook a meal for two, grab a glass of wine, and then snuggle up with a movie. It can show how much you appreciate being able to sit down and talk about a potentially challenging topic.
If you and your significant other plan on being together in the long term, talking about your finances are going to come up sooner or later. While it may seem daunting at first, it’s probably best to get it over with earlier on in the relationship so you have more time to work on those long-term goals and dreams. Hopefully, we’ve shown that if you’re open and honest with your partner, stay away from judging one another, and setting realistic goals and plans on how to achieve them, you can stop stress or a fight before it begins. The best way to win a fight is to avoid the fight altogether.
How do you and your significant other approach financial discussions? Please let us know below in the comments!