Is Money a Menace in Your Marriage?
We say it again and again and again- money is never about money. If you put two people together in a marriage, it’s easy to develop more than twice the amount of emotions around money. Quick example- how many financial perspectives are in a two-person relationship? Two, is generally the answer. But that’s not entirely correct. Here’s the correct answer- 6. Let us explain using the example of Maggie and Mark.
There is Maggie’s perspective. “I am a saver.”
There is Mark’s perspective. “I earn a lot of money, so it’s ok to spend it.”
There is Maggie’s perspective of Mark. “He’s a spender.”
There is Mark’s perspective of Maggie. “She is so cheap.”
There is Maggie’s perspective of what Mark thinks of Maggie’s perspective. “He thinks that I just want to control everything with money.”
There is Mark’s perspective of what Maggie thinks of Mark’s perspective. “She thinks I am going to take us over the edge of a financial cliff.”
Need a glass of wine or maybe a vodka shot just from reading that? We don’t blame you- but you can see our point that money is not just about the money. Those viewpoints all contribute to the tension that even successful marriages still deal with around money issues. Throw in personal histories and why people do what they do with money, and we’ve all got some seriously ingrained habits and points of view that may not serve us well.
How do you fix this so you can work together instead of against each other? Self-awareness and communication are the best answers. But saying that is also like telling someone that if they want to be physically healthy, they should eat well and exercise. Great advice, but we all like to binge watch movies and eat chocolate. But just like diet and exercise, small steps can get you where you want to go.
First, don’t wait until there is an emergency. Find a quiet moment (or make one) and tell your partner you’d like to work on how you each think about finances. Start with questions, like how each of you started to form opinions about money and how it should be used. Talk about scary things that happened as you learned, as well as what you learned from good experiences. Just share without judgement or expectation. Try to get a good understanding of how both you and your partner developed the patterns and habits they have. At the end of the discussion (or discussions), repeat what you think you heard from your partner (and have them do the same). Hopefully, your perspectives about each other are closer to the same page, and you have an understanding of where the behaviors came from. You may also have some additional insight into why you do what you do with money.
Maggie’s parents were always fighting about money. They never had enough, and it left her scared to spend anything she ever made- to the point where she never felt safe. Mark’s parents were business owners and were either rich or poor all the time. He learned at a young age that you should “spend it while you had it,” as it might not be there later.
Second, discuss the overall goals you have for your financial resources. One of you may be very oriented toward creating long term security. The other may feel like life is fleeting, and you can worry about tomorrow later. Do you love each other? Then how can you meet in the middle? Is there enough to have “saving money” and “free money”? If not, how can you create it? By cutting fixed costs, or by earning more money? What are you both willing to contribute or reduce?
Maggie needs to know she has an emergency fund that can take care of them if something bad happens. She needs to know that when they can no longer work, they will have enough to care for their basic needs. Mark needs to feel like he has freedom to live life. He likes to travel more than anything- as it breaks his routine and makes him feel fulfilled.
Third, move on to tactics. How do you set up regular habits that take care of both of your needs without having to think much about it? This would include everything from how to structure your bank accounts to how to save or distribute income from investments. It includes creating not just a spending plan, but how that spending plan operates smoothly with minimal work. It includes a set time to discuss how things are going and tweak changes when need be.
Maggie and Mark determined just how much they felt would be enough for an “emergency fund”. They wrote that number down and both signed off on it. They determined how much they needed to save each year and made it automatic. They also determined how much they could afford for travel- it wasn’t what Mark had hoped for. Maggie decided she would work toward a promotion at work she wasn’t sure she was qualified for- and got it. This raise will go toward their new travel budget.
Fourth, follow up and review what is happening. Are both people’s needs being met? Is talking about it easier than it was before? If so, that’s progress. Keep heading in that direction. Be aware, it may get harder before it gets easier. However, if you continue to work with honesty and love, and a goal to make it better, you should be able to get there.
Maggie and Mark originally thought Maggie would keep the budget while Mark kept track of their investments and savings. But they decided to switch places to see what would happen. Mark got very good at making sure they weren’t over budget to protect his travel money. Maggie started feeling safer after she watched their savings grow year after year from regular contributions. They still would get frustrated when they had conflicts, but now they know they can work them out as they come up.
Obviously, this is a VERY oversimplified example. With any luck, it demonstrates how knowing the root cause of the behaviors help modify the behaviors positively. Many times, we have had clients joke about us being marriage counselors as well as wealth managers. While we’re flattered, that is not our goal. However, we do believe that our approach to help people communicate more effectively with each other about money helps them reach their goals much more effectively. It’s one of the most rewarding parts of our mission.