According to Money Magazine, 70% of married couples argue about money – more than about sex, household chores, time spent together, what’s for dinner and snoring. What does that say about the state of our money situation? Studies also show that what happens before marriage will probably happen during. To head off money conflicts from the nuptial-planning beginning, employ these techniques to find out what you need to know about the situation.
The money-spat breakdown of couples, according to the Money survey, show the categories as follows: Spending 55%, Saving 37%, Deceit 21% and Exclusion from decisions 11%. The money-fight within the money-fight, if you will.
So how can we move forward as lovers instead of warriors?
- Go in with a peaceful, non-accusatory, empathy and helpmate kind of attitude. Chances are there are some not-too-pretty things in your financial history. Most everyone has bitten off more charge cards than they can chew. Fussing about it, accusing your mate of irresponsibility, and letting-words- fly-from-your-mouth-before-thinking will NOT help the situation.
- Make a list. It is easier to see what you’re working with when it’s on paper. Start with liabilities – balances and payments. Start by categorizing – I Owe, You Owe, We Owe. Using the same categories, list your after-tax income by pay period – I Bring Home, You Bring Home, We Bring Home. This is about the ‘WE’, right? Continue on by assigning each liability to a pay period. For example, if the mortgage or rent is due on the first, pay it with the income from the first. If cable is due on the 20th, pay it with the nearest pay period. Giving each income an assignment minimizes the energy and stress of constantly thinking about the when and how liabilities will be paid.
- Prioritize spending. I am a proponent of giving oneself an allowance to be used as desired – on lunch, lipstick, golf, movies, etc. All other spending should be prioritized. Is it more desirable to upgrade a vehicle or take a vacation? Have you saved what’s needed to propel you to the retirement that you desire?
- Decide whether you will operate a joint account or separate accounts. There are many schools of thought on this point. Some people want to maintain ‘control’ over their income where others want one spouse to take responsibility for bill-paying and managing saving accounts. While either method can work, it should be agreed upon and adjusted as needed.
- What’s the score? Credit scores are an important component in the ability to borrow money and the rate you must pay for that money. It is a good practice to get a copy of your credit score at least once per year. Reporting agencies do make mistakes and sometimes things slip through the cracks on our end. The last thing you want to deal with at the buyer’s table is incorrect information on your report.
- What are your money dreams and desires? What do you want your money to do for you? Buy or save, now or later? You may want to live like a prince now, live like a king later. Saving 10 to 15% now can produce a healthy account in your later years. Dreams can become a reality…with planning.
- Keep up with where you are and where you’re headed…personally and fiscally speaking. The Money study showed that 60% of husbands and wives check their bank balance more often than they have sex. Can you imagine?
Right now, commit to be a statistic-busting couple. Find ways to communicate about money with an end goal in mind. You’re in this together, I encourage you to stand as a united front and make decisions that benefit the union.
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