Some of the nastiest fights I’ve seen between spouses in session have not been about sex, affairs, or kids… they’ve been about money! Money is heavily tied to feelings of security, power, and opportunity. Nothing triggers a heated argument like partners being on different pages when it comes to finances. These fights don’t usually come from a lack of money, but from partners not seeing eye to eye on how to manage “our money” as a “we”.
As singles, we develop our own systems to manage our own money. When we couple up, broaching the money conversation becomes an anxiety-filled struggle because we end up feeling like we are losing or giving in. I ask all couples I work with how they handle money. The majority of them identify it as an issue and report they don’t even know where to start the conversation.
I’m a couple’s therapist and while I hear couples fight about money all the time the actual nitty-gritty of financial organization is definitely out of my scope of practice. So, I enlisted the help of financial expert Michael Kramer, founder of Mott Capital Management, LLC, to help couples who want, nay, NEED to have the money conversation, but don’t know where to start:
For couples that have not yet discussed finances together, what are the main topics they should cover in their initial discussion?
Finances should be something that is discussed openly and freely, like any other topic. Given that this is tax season, it is an excellent time to review 2015 together. Start with the basics: How much did you earn? What were your deductions? What do you plan to do with your refund? Or how do you plan to pay if you owe? These are all pretty basic things to start with. At some point, the discussion should really shift to what your long-term financial goals are. Take advantage of tax season to start the dialogue and ease into it.
What is a good starting point of discussion for couples who are not financially organized or aren't on the same page when it comes to finances?
The most basic thing a couple can discuss is cash flow. Are you saving? At the most basic level you need figure out your income and expenses together. After you figure out your cash flow you can start talking about other things.
What is the key information a couple should know when setting up a joint bank account for the first time?
A joint bank account is not the end to your financial freedom. In a way, it is actually the beginning. As a couple, you will have a better idea and understanding of your finances. This will hopefully lead to a discussion on how you can both work towards your financial goals.
What are your thoughts on financial transparency in marriage? Should spouses have access to and know how much is in each other’s individual accounts?
I think financial transparency is extremely important in a marriage. Both people should know what is going on and have a say. It is not uncommon to have one person handle the finances. However, both parties should have a say in what happens and it should be discussed. Hiding anything from one another could be a real catastrophe for a family’s finances.
When should a couple see an investment advisor to help them manage their finances?
I think it is commonly thought that you only need to see someone when you have a certain amount of money. I think that is completely wrong. Everyone should sit down with a professional to talk about their finance at least once a year. Life is constantly changing and so are your finances. If you can handle them yourself, that is great. However, if you and your spouse are the kind to not pay attention to it, then you need to find someone you trust to sit down with. Start early and stay involved.
Michael added a great bonus question to address:
When should couples start planning for their children’s college?
They need to start within the child’s first 6-9 months of life. Even if it is $25 a months. Set-up a plan and start. There is nothing more powerful than the time value of money and the compounding of interest. There are many easy ways to do this. You will be glad you did this when they are ready for college.
In summary, the key points to discuss when you are first starting to talk about money are: creating financial transparency by discussing money openly, monitoring your cash flow, opening a joint account to get a better understanding of your combined finances, finding a trusted financial advisor (like Michael), and starting a college fund for your little ones. Creating financial organization in your relationship is a powerful way to reduce anxiety, build trust, and work together towards your goals and dreams. Now, that sounds like a worthy time investment to me!
Let us know in the comments below how applying these tips helped you and your partner address finances. We look forward to hearing from you!
Marina Voron, MA, LMFT is a Licensed Marriage and Family Therapist, Co-Founder, and Clinical Director of Nassau Wellness. Marina believes all couples have the power to form a loving and lasting relationship given the right tools. Marina specializes in couples therapy, sex therapy, emotional affairs, anxiety, and communication issues. Read more...