Most couples take an in-depth look at their finances just twice per year, at year-end and tax time. Even for many of those couples, ‘in-depth’ may entail little more than actually fully reading all of their bills and account statements. Thus, all too often when one partner wants to have a more detailed discussion about finances, stress and arguments ensue.
How is your relationship with money? How easily can you talk about it? Sure, it can be no problem when it is just you, but mix in another person — and yikes! — communication can shut down or turn into a heated argument quickly. Especially when you decide 11:00pm is the best time to address your spouse about a high credit card bill. (Hint: make a rule that no money issues may be discussed after 9:00pm. You’ll sleep much better).
The key to having a successful financial plan when you have to share with someone else — most notably a spouse, but this can apply to a roommate, a girlfriend or boyfriend or a family member(s) —is intentionally taking the time to DESIGN YOUR ALLIANCE with each other.
What is an alliance? Think Survivor if you must. An alliance is where you form an agreement with another party about how you will structure your relationship and determine who has what role(s) and responsibilities. You make the ground rules before an emotional situation comes into play so you know how to respond (coming from the logical part of your brain).
Money Management Alliances are formed to create a workable solution for both people involved. This way you take the personal parts out of your money discussions and always refer back to the terms of the Alliance. With an Alliance, you both know how to act under the system, what your role is, and you have an open way to share concerns, wins, and changes. In fact, to make it most effective, write down your agreements so you have a document to reference later. You take the “he said, she said” out of your discussions and direct your attention to a separate entity — the Alliance (or The Agreement). Remember, if the Alliance is not working for one or both of you, you create the safe space to discuss and propose changes.
How do you make an Alliance happen? It all starts with a regularly scheduled Money Meeting. A Money Meeting is where you talk rationally about your money issues. Unless a question is urgent (as in you will be late making a payment if you do not have resolution), save up your list of topics until the meeting. This helps diffuse any anger you may hold.
Strive meet weekly but starting semi-monthly will get you going. Block out a window of time in your schedules when you know you usually have high energy. Your relationship with money should take the same level of importance as your work and family appointments.
As you may at a ‘work meeting,’ set an agenda. Allow each party to share, leave time for discussion, and make sure you wrap up by summarizing any action items — assigned to owners with due dates. Finally, make sure you congratulate yourselves for proactively handling your relationship with money.
This may sound like a challenging and perhaps time-consuming exercise, but many couples that I work with (as well as my husband and I) find you can quickly develop a format that doesn’t take very long, helps you take far better control of your finances and can even substantially reduce a key stress point in your relationship!
When Kristin isn’t writing awesome content for us, she spends her time as a Financial Planner in San Francisco. She often blogs about life and finances.