For many couples, managing money harmoniously is tricky. Whether you just moved in together, got engaged or married, money is a leading cause of disagreement for couples.
Communication is known to be the cornerstone of a successful relationship. But when it comes to money, many partners don’t broach the subject until after they’re in financial trouble or have serious gripes.
Use these four essential tips to avoid potential problems and manage money successfully as a couple.
[See: 7 Signs Your Romantic Partner Is Financially Unstable.]
Combining finances is a personal preference. If you’re close to getting married, or are 100 percent committed to each other and feel certain that your union will stand the test of time, it’s generally best to view money as ours, not mine or yours.
It doesn’t matter if only one person works, one earns more than the other, or one partner brings more debt to the relationship. The financial give-and-take in a relationship is never even, and love shouldn’t keep score when it comes to money.
For most couples, uniting money works best because you have fewer accounts and administrative tasks to handle. Plus, when each of you knows the truth about your finances, it builds trust, fosters communication and allows you to accomplish more together than you ever could alone.
However, every relationship is different. If you’re not 100 percent committed and certain that you will be with your partner forever, or you have any reservations about merging money, then you probably shouldn’t. The downside to tying a financial knot with someone is that untwisting it can be a nightmare if the relationship ends.
Arrange your coupled finances in a way that works best for you, but also be open-minded about setting new guidelines and changing tactics if your setup for handling money together isn’t working.
[See: Decode These 10 Vexing Financial Terms.]
Communicating about your financial past and future is critical. What’s best for the finances of your partnership or marriage begins with candid and respectful conversations about your beliefs, concerns and goals. You’ve heard the saying that “opposites attract” in the personalities of couples. Financial behaviors and habits in couples can be very different as well.
For instance, are you a compulsive spender or a strict saver? Do you swing for the fences or take a conservative approach with investments? Are you at ease with or terrified of debt?
A quirky financial tendency that endears you to your significant other in the beginning, such as being a free spirit who lives and spends money in the moment, may be an irritation down the road.
So watch out for potential problems that may need to be addressed, such as overspending, keeping money secrets or refusing to create a budget. Be honest about both of your good and bad financial habits before merging your finances as a couple.
You might set a stress-free time to talk on a weekly or monthly basis about following a spending plan, paying bills and meeting your financial goals. Maybe it’s while you take a walk or go out for a nice dinner together.
Discuss the specifics of what you want to achieve with your money in the near future, such as saving for a special vacation or a new car. Some of your long-term goals may change over time, but having huge differences of opinion is something you need to address sooner rather than later.
If talking about money with your partner seems too difficult, or it causes you to end up in an argument, you may need to speak with a marriage counselor or couples therapist for help.
Working as a team makes you more successful. While conversations about money with your partner can get feisty, don’t let anger or resentment get the best of you. Explain your thoughts and feelings logically and ask your partner whether he or she is willing to work as a team to be successful.
Many people need help creating a financial plan, so don’t hesitate to use a financial professional. Check out resources like the National Association of Personal Financial Advisors at NAPFA.org or the Certified Financial Planner Board at CFP.net to find a financial pro.
When you’re a committed couple, it’s smart to strategize and organize your life in unison. You can accomplish much more together than you ever could apart.
[See: 8 Times to Talk to a Financial Advisor.]
Using good financial tools keeps you on track. No matter whether you decide to merge money as a couple or not, there are some financial tools that make managing it easier. Try Quicken software or Mint to import your bank and credit card transactions into a dashboard. They allow you to keep track of spending and create a budget.
Expenses you want to split can be assigned to a special account such as “joint household expenses,” so they’re separated from your personal expenses. Then you can settle up using a variety of apps that allow you to send and receive money, such as PayPal, Venmo and Zelle.
Instead of allowing money to hurt your relationship, use it as way to grow closer. For richer or for poorer, you can establish good money-management habits that create a lifetime of financial success.
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4 Ways to Manage Money Better as a Couple originally appeared on usnews.com
