Is money something you avoid talking about in your relationship? Open and honest communication is an essential part of every relationship, especially when managing finances in your relationship.
Money is one most common issues couples argue about, and it’s also one of the top causes of divorce.
Decision-making may come naturally to you as a business owner, but there should always be an equal say when it comes to financial decisions in your relationship. If one person makes all the calls, there may be blame and hostility when mistakes happen.
Money conversations are difficult, but they begin with inclusivity, where both parties are heard. Here are four tips to navigate towards financial success in your relationship.
4 Tips to Manage Finances in Your Relationship
1. Get clear on your goals both individually and as a couple
One of the most insightful things we’ve discovered through Ocean 6’s goal-setting exercise is that couples are unaware of each other’s personal and financial goals.
But why is coming together and getting clear on your goals so important? It creates a scenario where both of you can advocate and support each other’s goals, rather than being uncertain of what either of you is working towards.
When your goals are on the table, you can find ways to align them and allocate money towards both your shared and individual goals. Two people working towards the same goal will help get there faster.
(This is how you can intentionally save and allocate money towards your important goals)
2. Set up joint accounts
We get questions about setting up joint accounts all the time—“Should we combine or separate our money?”. We recommend both.
Setting up a joint account is perfect for taking care of the things you share; this can include your home, bills, legal affairs, vacations, or supporting your children. Money is readily accessible when you need it, and you won’t need to ask your partner to contribute to paying the bills every single time. There will be full transparency on all shared expenses.
However, it’s still important to have your own separate account to keep financial independence. People have different spending habits; for example, you don’t want your partner questioning why you bought a coffee last Tuesday!
Figure out how much of your income you’re putting into the joint account and your separate accounts.
3. Review your goals and cashflow plan monthly
Your goals and cash flow plan are not a one-time discussion.
In reality, things change all the time. You’ll buy homes, have kids, move to different cities, and get new jobs, so it’s very important to review your goals and cash flow every month.
If there are changes to your financial situation, you can adjust your cash flow plan for the time being. The most important thing is that you’re on the same page as your partner. It’ll prevent resentment and conflict towards where your money is going.
Remind each other that you are a team with shared goals you’re working towards.
(Is work-life balance an issue for you? Goal setting can help fix that)
4. Celebrate your wins
When one of you has accomplished a goal, make it a routine to enjoy and celebrate that goal instead of just moving on to the next thing.
You want to recognize if you’ve just had children, bought a new home, or achieved anything of substantial success and excitement.
Not celebrating these wins and goals will make them feel less important, and you won’t be motivated to allocate time and money towards them.
Establishing Financial Success and Trust in Your Relationship
These might be simple tips, but they are also foundational building blocks to having financial success and trust in your relationship.
If you haven’t noticed, all of these tips essentially come down to clear and honest communication.
(Figuring how to talk to your partner about your financial future? Here’s what you need to know)
Everyone has different money expectations, which is why it’s a must to lay the groundwork when handling your finances together.
Here are some starting questions to clarify with each other:
- Which expenses are considered shared? For example, that sports channel subscription – personal or shared?
- Which of your goals are shared, and which are your personal goals?
- How much money should you contribute to the joint account? Is it equal amounts or proportionate to your income?
- Will you contribute to the joint account on a weekly, biweekly, or monthly basis?
A common source of money issues is not recognizing and understanding each other’s money expectations and financial goals. Don’t neglect to sit down and talk about it.
If you’re a business owner and want to discover how creating a financial plan with your partner can bring clarity and make a difference to your relationship, book a call today.
We’d love to help you and your family build confidence in your financial future.