Did you know couples fight about money more often than almost anything else? They aren’t always fighting about money itself, but about financial surprises caused by lack of communication.
The time to discuss your finances together openly and honestly is now – before you get married or make major decisions that tie your finances together! It doesn’t have to be scary. Following a few basic steps can set the two of you up for long term success.
Get it out in the Open
Each partner should start by listing all of the pieces of their financial puzzle. Now is not the time to keep secrets. If you have financial skeletons in your closet, know that they will come out eventually. Make a list of your goals too: do you want to buy a house in 5 years? Live abroad in retirement? Put it on the list.
Finally, write down some things you might be willing to sacrifice in order to achieve those goals. Think about your recurring expenses. It’s not impossible that you’ll discover some surprising things about your partner, but it’s important to uncover it now. When you’re still financially independent from one another, you can make rational decisions without the pressure of joint accounts or a mortgage.
Don’t Make it Personal
Bring your lists together and keep an open mind. Don’t judge your partner’s financial style or goals. For example, BMG loans to all kinds of people, we see firsthand that life can happen quickly and require emergency spending. If things get too tense, take a break or reschedule, but make sure to come back to the table. If it seems impossible to understand your partner’s ideas, remember this is someone you care about.
Neither one of you should be trying to “win”. If you find a way to work to compromise and make each other feel heard, the two of you can come out of this process feeling good that you’ve decided to work together toward goals you agree on.
Set a Schedule
Unfortunately, you can’t have one discussion about this topic and call it a day. In order to be successful, you have to meet regularly to stay on the same page. Making this meeting fun can help! Agree to order take-out once a month or meet at a restaurant you both like in order to discuss the ongoing state of your plan, expenses, income and goals going forward. Put it on both of your calendars and stick to it.
Loving Your Plan
A budget is not a punishment. Making and sticking to a financial plan is a way to achieve your dreams big and small. Simply knowing how money comes into your household and is spent can alleviate a lot of stress on your relationship. Agreeing on the things that are important to you and reaching toward big goals together can reinforce that you are in this together.
Last but not Least
Acknowledge that talking about money is not always going to be easy – especially in the beginning. If you can stick to your plan, it will become another automatic part of your routine. As you pay off debt or watch your savings grow, you will have something to celebrate together.
Talk to your partner today. Be ready to do the work and give each other the gift of financial honesty.