Tips for Couples So You'll Stop Fighting Over Money!
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Maintaining a healthy marriage or a long-term relationship takes time, dedication, and open communication. But if you and your partner don't discuss money, it could undo all the hard work you are doing in other areas of your relationship. Here are three things you and your partner should do to manage money better.
1. Write Down Your Financial Goals
Do this, preferably, at the start of every year. Openly discuss and jot down your plans for the new year that involve money. This should include both long-term goals — such as buying a new car or a house, sending your child off to college, taking over your parents' health-care responsibilities — and short-term goals, like planning your next vacation. This will enable you to accurately assess your capabilities of achieving personal financial targets.
My husband and I start with a "dreamer conversation." For example: Where do we want to be professionally and personally in the next year? This helps us put things in perspective and realize if we are thinking too big or too small.
We then make it a point to go over our annual bank statements and calculate how much debt we carry, so that we are clear on how we expect to handle money in the next 12 months to achieve our dreams.
Related: How Will COVID Affect My 401(k)?
2. Set a Monthly 'Spending Money' Cap
This is a tough goal, but if you set up a budget and track it religiously, you will realize how easy it is to achieve your bigger financial goals. Apart from fixed monthly expenses, such as rent or a mortgage, groceries, gas, and electricity, set a number you won't exceed for leisure, such as take-out food, electronic devices, and clothing.
We have a habit of going through our credit history together every month to assess areas where we can spend less. That way, we can keep a select amount aside for irregular expenses, such as routine car maintenance and doctor appointments.
3. Build an Emergency Fund
The coronavirus pandemic has affected businesses severely. With unemployment skyrocketing in these uncertain times, many professionals are concerned about job security. Therefore, it is necessary to identify the number of months you and your family can survive, with the mortgage and child and eldercare expenses, if your collective monthly income takes a hit.
For us, the pandemic acted as a wake-up call, which is why we made building an emergency fund our top priority. We have started setting aside money for unexpected situations (such as family illness, lost job, and major home repair).
Aim to save for six months’ worth of household expenses if you have not started already, and strive to increase the amount periodically. This money should also not be kept in your regular savings account; I recommend opening a joint savings account with your partner.
Money symbolizes emotional needs and safety; hence, the "money talk" is often one of the trickiest subjects to address for couples. No matter how hard it is, achieving financial independence is easier when you and your partner are on the same page. Sometimes, it is not about the money per se, but rather about managing it diligently.