Because finances are a core stressor for many adult relationships, it’s best that the topic comes up sooner than later. We’ve developed a list of tips that may help you be financially savvy in your marriage. Not married yet? These tips can still be beneficial for you to keep in mind while looking for a partner or discussing marriage with your person.
1 – Address Financial Values
We’ve heard it over and over again. Communication is the foundation of successful relationships. However, some topics are harder to discuss than others. Chatting about finances isn’t necessarily a romantic topic, but it is important. Ideally, this conversation is had earlier on in a relationship, but it’s not too late now.
Let’s go over how to start this type of conversation. Many people haven’t even thought through their own financial values. Take some time to think through your own answers to these questions, and then bring some of the questions up to your partner to understand theirs.
Where do you currently stand with your finances? Are you happy with the amount you bring in? What are your goals for 1, 3, 5 years? How much do you spend regularly? Do you find budgeting helpful? What areas of spending are unnecessary to you? Do you invest? Are you a risk taker? How much of each pay check is put in savings? Do you have a plan in place for retirement?
Let us go ahead and share that the chances of you agreeing on every one of each other’s answers would be extremely rare. Regardless, it is valuable to open the conversation in a respectful way. Don’t attack your partner on their habits or topics that aren’t mutual, rather discuss them and find ways you can both strategize.
2 – Don’t Keep Secrets
It’s estimated that 20-40% of all divorces are attributed to financial problems. One major reason is because there is debt or excessive spending behind closed doors. If you are coming into a relationship with debt, your partner 100% deserves the right to know before taking further steps to commit to you. No matter how much it may feel like a skeleton in your closet, coming up with a plan of how you’re going to solve it, and sharing that with them is crucial.
The longer you keep secrets, the more they will be upset when they find out. Being open and honest gives you two the ability to work together and possibly eventually to create a stronger bond. Should you have bad credit, an excessive spending habit, or poor financial values, having these conversations can be helpful for a healthy relationship with money moving forward.
3 – Write Out Your Goals
Whether you believe in goal setting, manifestation, or tracking progress, this tip is one that is both fun and useful. Start your financial conversation with this ice breaker or close the conversation on a high note with this exercise.
Each person should have two pieces of notebook paper. On the first page, brainstorm. Set a timer for 4 minutes and both of you should list any financial goal that comes to mind. This can
be an amount you would like to make, a purchase you’re dreaming of, an investment you think could be profitable, etc. Just keep writing.
Once the timer ends, use your second sheets of paper to list the goals in order of your priorities. Next to each goal write if you consider this a short term or long term goal, the amount you’ll need to accomplish this goal, and one way you are going to start working towards the goal now.
Go over your lists together! You may find out that one or several of your goals align with your partners. If so, this is exciting! Highlight these goals as they are couple goals that you’re both striving for. It is healthy to have both personal and couple goals financially. Revisit them monthly or every 3 months.
4 – Build an Emergency Fund
The importance of having an emergency fund has proven itself over and over again. What is an emergency fund? An emergency fund is a sum of money that is set aside with no use attached besides unexpected costs. The amount to set aside in an emergency fund differs situationally.
It is noted by wealth managers that having 3-6 months of living expenses in an accessible savings account that is not withdrawn is a mature way to insure have the money you need should it be necessary. If you don’t have that much to set aside now, start putting an amount into this account gradually. You can even set many bank apps to do this automatically each month.
5 – Learn About Investments
Everyone can learn something about finances. If you’re looking for ways to further your financial education there are several ways. You may start with books or podcasts on the topics you’re interested in. There are also many free videos online that could be helpful. If you want to take it a step further, you may also want to seek the help of a financial advisor near you. Make sure they understand your priorities.
If you find that you have extra money lying around after paying your monthly bills, maybe it’s time to look into investing. There are many different ways to invest. Currently, high-yield savings accounts are available. You may be more interested in stocks, bonds, or real estate. Angel investing in a start-up is also an option for people who are accredited investors. An accredited investor is someone who must meet the criteria of making an average yearly income of $200k individually or $300k with a spouse/domestic partner.
At Sessums Law Group, P.A. it is our goal to provide you with relevant information to help you become more financially savvy in your relationships. We hope you find this collection of helpful hints valuable moving forward.