Experts say that money is one of the top reasons why people divorce or split up but some people are funny about money even when it comes to talking about it. There are several reasons why money is important in relationships:
1. How your partner handle their money says a lot about their values and what’s important in their life. For example, people who value education will tend to spend more money accumulating student debt while someone who believes in self-indulgence or perceiving a certain image tend to accumulate consumer debt.
2. When you have debt, it limits the choices you have. This can be difficult on relationships if most of your time is spent working to pay down the debt rather than spending it with each other.
3. Having financial security enables a sense of psychological safety. Financial troubles can be worrying when you have to think about how to survive to your next pay cheque. Having some savings and a plan allows for you to feel like you’re working towards a goal together so you can relax and feel like you have something to fall back on.
Most people are aware of one or more points above but what if you’re in a situation where your partner may not be the best at managing money. If you’re married, it can be an even bigger problem since debt is often shared by both partners. For those who are entering marriage, talking about a prenuptial agreement can also be tricky. Here are a few tips on tackling the issue with your partner.
1. Be realistic about how much you make as a household.
Spending beyond your means is the key reason most people go into debt. Buy now, pay later can be a dangerous indulgence that will cost you in interest rates.
2. Work on creating a balanced budget with your partner.
If you live in Vancouver, make sure you pay attention to your housing cost. The recommended amount for housing is 35% of your monthly income. Anything more can become too much to handle.
3. Eat and make sure you’re rested before talking about finances.
Everybody is happier with a full stomach and some rest. Don’t enter a discussion about finances if the time isn’t right.
4. Be honest (completely honest) about your financial standing.
Hiding debt from your partner can be a form of betrayal. You’re putting your partner at risk if they happen to lose their job or an unexpected expense comes up. If you’re married, you may be responsible for half of your partner’s debt which can sometimes fuel a sense of resentment in relationships. Be patient and create a financial plan that you can both live with.
5. Pull your weight financially.
Couples who fight about money usually bring up the issue of one partner working harder (or caring more about debt) than the other. If you don’t make as much money as your partner, you’re in a position where you can spend less. Combining household income doesn’t necessarily mean you have free reign to spend as much as you want.
6. Don’t leave one partner to handle the finances.
Many couples will allocate one partner to handle the finances. This is a bad idea because this allows one partner to have their head completely in the sand about shared finances.
7. Separate your bank accounts for variable spending.
Combining income into one account is dangerous. Often, the person who makes more becomes resentful if their partner spends more than they do. By having a joint account for household bills, you can see the shared expenses clearly.
8. Get a prenuptial agreement before marriage.
While most people find the idea of prenuptial agreements riddled with pessimism, it’s a great way to plan ahead while you’re still in a rational state. Just remember that most couples don’t enter a marriage expecting it to end but many do.
Amy Yew is a registered clinical counselor and relationship therapist. She is also the author of a fashion and lifestyle blog Style Du Jour. Tell us what you think and submit any questions you have to amyvancouvercourier@gmail.com.
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