Many couples disagree and argue, but there’s a particular subject that tends to be more damaging to relationships than others: money. A study published in 2013 in the journal Family Relations examined more than 4,500 couples and found that fights about money were a top predictor of divorce regardless of income, net worth, and debt levels.
When you’re constantly at each other’s throats about money, you and your partner lower the satisfaction you get from your relationship. Even in cases when decreased relationship satisfaction doesn’t lead to divorce, it can increase your stress levels and have a negative impact on the health and happiness of other members of the family, including your children. Understanding what you’re fighting about and why you’re fighting about it helps you and your partner come up with a way to work through arguments.
1. Spending Habits
Whether it’s you or your partner who’s a shopaholic, a difference in spending habits isn’t something to sweep under the rug. Resentment and frustration can grow if one of you feels helpless in the face of the other’s habits – or if one feels that the other is spending all your money with no thought for the future. If you and your partner regularly butt heads about the other’s spending habits, there are a few ways you can work through the issue and understand each other better.
See Where the Other Is Coming From
Habits develop over time and for a variety of reasons. Try to put yourself in your partner’s shoes so that you get a better sense of the reasons and motivations of spending. A good conversation starter is to ask each other about the spending and saving habits your parents modeled for you. For example, ask if your partner’s parents were savers or if they lived beyond their means. Ask if parental behaviors and attitudes toward money have affected the way your partner looks at or treats money.
You can also work together to identify each other’s spending triggers. Sit down together and ask yourselves what makes you more likely to spend. List the cases when you might be more inclined to go out shopping, such as after a bad day, if your favorite store is having a major sale, or if you’re bored. When you see what’s triggering your partner, you can develop a better sense of how to work together.
If a bad day makes either of you more likely to shop, make a list of things you can do instead. Rewatching an episode of your favorite show, making cookies, or working on a craft project are all great places to start.
Because spending habits develop over time, it’s a rare thing for a person to give up something quickly. Be patient if your partner is the one cutting back on spending and ask your partner to be patient if you are the one making the big adjustment.
Keep track of your joint spending for a month. If you’re spending so much that you aren’t reaching your financial goals, begin to wean yourself off certain unnecessary expenses. For example, if you both buy morning coffee and lunch out daily, commit to bringing them both from home one day per week. If you go out for drinks every day after work, skip one evening of happy hour.
The next week, reduce your spending budget by making another cut. For example, bring a brown-bag lunch to work two days that week, instead of one. Keep reducing week by week until you and your partner reach an acceptable and agreed-upon level of spending.
If one of you slips up and overspends, take a close look at why that happened. If it was a bad day that triggered the spending spree, come up with alternative ways to deal with stress and anger, such as meditating or going for a run.
Get Everything Out in the Open
Honesty is the best policy in any situation. When you first have the money talk with your partner, break out your bank and credit card statements so each of you can see what the other tends to buy. Before revealing your financial details, promise that you won’t judge each other or make snide comments. Reviewing your spending habits can help you both set goals and find where you need to cut back.
Once you’ve set a budget together, if you slip up and buy a $500 purse or drop $400 on a pair of concert tickets, don’t try to hide it from your partner. Instead, come clean and admit that you overspent on an item.
When you’re honest, you can work together to come up with a solution. You can return the purse if you both agree it strains your finances and is something you simply don’t need. If you can’t get a refund for concert tickets, you can try to sell them on a third-party website, if doing so is legal in your state.
2. Saving Habits
Couples don’t only fight about the spending habits of one another – they often disagree about how (and how much) to save as well. For example, some people might be so focused on saving that they’re willing to pass up many life experiences, from travel to eating out at a restaurant, while others appreciate a little splurge now and then. One half of a couple might be nervous about investing in stocks and wants only to invest in CDs or savings accounts, while the other half can handle a bit of risk.
Create Common Goals
Sitting down with your partner and making a list of goals can help you both determine how much to save each month. If neither of you has focused on retirement savings yet, you can jointly decide to put aside 10% of each of your incomes into your own retirement accounts every month.
Typically, it’s recommended that you have between three and six months’ worth of expenses tucked away in an emergency fund. Look at your joint income and determine how much you can comfortably put aside each month, and how long it should take to reach your goal. If you’re able to live for six months on $10,000 and you can afford to put $1,000 toward the fund each month, it should take you about 10 months to have a full emergency savings account.
Along with long-term saving goals, you should set up shorter-term goals. Perhaps your car is on its last legs – if this is the case, you can agree to set aside a small portion of your incomes every month to save up enough to buy a car outright or put a sizable amount down on a car loan. You can also agree to create a joint savings account for vacations or other yearly purchases, such as holiday gifts and other expenses.
Deal With Different Investing Styles
It might not be how much to save that you and your partner disagree about, but rather how to divvy up or invest your savings. Having a partner who’s very risk-averse – or the opposite – makes it difficult to build up a balanced, diversified portfolio.
Keep in mind that your retirement accounts are separate, meaning you can each invest in your own accounts however you deem best. That means if your partner likes to play it safe, lower-risk retirement vehicles such as bonds might be ideal. If you’re more of a risk-taker, you can invest in stocks in your own retirement account – these can lose value, but may also earn a higher rate of return over time. If you want to diversify even further, you can invest in fine art through Masterworks or real estate through DiversyFund.
You need to be more diplomatic when it comes to a joint non-retirement investment account, since it is held by both of you. Working with a financial planner can help the two of you figure out a good investment strategy so that you both feel comfortable with how you’re managing your savings.
3. Who Earns What
It’s fairly common for one partner to earn more than the other, and income disparity can lead to fights and feelings of resentment or insecurity. Additionally, one partner can feel inclined to have more of a say over what happens to the money if there is a big difference in income.
Even if there is a large gap between the amounts both partners earn, you can still work together to create a balanced and fair budget. Instead of dividing your joint expenses in half, split them up so that each person pays an equal portion of income. If one partner earns $100,000 per year and the other $50,000 per year, and your mortgage payment is $1,500 every month, the higher earning partner can pay $1,000 and the lower earning partner $500.
Each person should also have a say when it comes to decisions that affect the home. For example, even if the higher earning partner is paying for an entire vacation or for a new furniture set, it’s not fair for that partner to get to choose the vacation destination or the furniture style without any input from the other.
If that’s happening to you, take the time to share with your partner how it makes you feel. It could be that your partner doesn’t realize that making decisions without you is hurting your feelings. In this case, a reminder that you are both working together, even if your incomes aren’t in alignment, can be helpful.
There’s also the issue of unpaid housework to consider. The partner who works outside of the home might not contribute as much to the housework as the stay-at-home parent or spouse, or the higher earning partner might do fewer chores than the lower earner.
If there is a big disparity when it comes to household chores, you can monetize one partner’s contribution. Your spouse might not earn $100 per week in cash for housework, but do the equivalent of $100 worth of work each week (if that’s what it would cost you to hire an outside house cleaner or cook to do the same job). To make up the difference, the partner that earns a higher salary can agree to contribute $100 per week to another expense, such as the cost of groceries or cleaning supplies.
In some cases, a partner who earns less might take on more responsibilities at home to try to close the gap between incomes. A spouse who doesn’t have an income producing job might care for the kids or work to put dinner on the table every night.
However, even if one of you works and the other doesn’t, it’s not fair for any single person to do all the household chores or handle all of the home maintenance issues. A partner who has to care for a home alone, without help or support from a spouse, can start to feel angry and resentful.
Instead of having the lower-earning partner shoulder all responsibilities, work together to divide up chores based on schedules and time. For example, if you stay home all day, it might make sense for your working partner to drop the kids off at school in the morning or pick them up in the afternoon so you don’t have to make a special trip. If the partner who works outside of the home has to go to bed early, you can take on the responsibility of finishing dinner clean-up and making sure everyone is set up for the next day.
4. Who Controls What
Having one person handle the budgeting and bill paying can make sense. However, issues can crop up when one person oversteps the boundaries or tries to take full control of a couple’s financial situation.
Signs of a control problem can include a partner who expects you to hand over your earnings each month without question, a partner who won’t let you use a credit card, or a partner who gives you an “allowance.” Avoiding fights with a financially controlling partner can be particularly challenging, as this type of person isn’t likely to want to give up control.
Have a Talk
As with other common arguments, having an open and honest talk can help people realize they may be too controlling over money. It can also help folks work together to get to the source of the issue and come up with a solution to the problem. If talking together on your own doesn’t help resolve the issue, you and your partner can benefit from working with a couples’ counselor.
Agree to Alternate
One way to work through control issues when it comes to money is for you and your partner to decide to alternate who’s in the driver’s seat. Your partner can take the reins one month and make sure the bills are paid and that your disposable income is allocated properly. You can take charge the next month, paying the bills and keeping the budget balanced.
Another option is to switch who regularly oversees what. Your partner might keep an eye on savings one quarter while you handle the day-to-day expenses and bills.
5. Past, Current, and Future Family Support
Although the exact cost of raising kids varies based on where you live, the USDA estimates that a middle-income, two-parent family can expect to spend between $12,800 and $14,970 per child, per year. No wonder couples often fight over whether to have kids and what to do about them once they arrive.
You and your partner should agree on how much to budget for a child or children and how long to provide support to your kids. Although the USDA’s figures assume parents support their kids from birth to age 18, without paying for college, plenty of parents are left supporting their kids well into adulthood. It’s important to sit down with your partner and make a financial plan for when you have children.
It’s not only children that you might fight about. You and your spouse can disagree when it comes to caring for aging or ailing family members, and one of you might be planning on having your mom and dad move in at some point. If that’s the case, you should share those feelings with your partner sooner, rather than later.
Develop a Plan
Before you have children or decide to have one set of parents move in, sit down together and devise a plan for future expenses. Look at whether you’d be able to afford a child on your current income, or if one of you stops working to care for the kids. Discuss how you plan to save for your children’s college, if at all, and whether (or how much) you should save to care for ailing parents in the future.
Enlisting the help of a financial planner is a good idea. The planner can examine your current financial situation and make recommendations for college saving plans and other savings accounts, based on what you might need in the future.
6. Past, Current, or Future Debt
How much debt each of you brings into a relationship, as well as your attitudes toward tackling it, can be a source of strife. As with other financial matters, you and your spouse can have different mindsets when it comes to debt, from whether it’s acceptable to carry a credit card balance, to whether you should be in a hurry to pay off your student loan debts. Instead of fighting about debt, you want to be upfront and honest about your attitudes and your actual debt burden, and devise a plan to help you both reduce or eliminate your debts.
Work Together to Pay it Off
When you’re part of a couple, the other person in the relationship doesn’t automatically assume responsibility of any debt you bring into the partnership. In fact, any debts you bring into a relationship remain your sole responsibility, even after you get married. That doesn’t mean that you and your partner can’t work together to figure out a debt repayment plan that works best for your joint budget. After all, coming up with a joint plan to reduce debt can help you work together to achieve other financial goals, such as qualifying for a mortgage together and purchasing a home.
Come up with a debt payment strategy together. You can decide to tackle any consumer debt first, putting a significant portion of your income toward credit card debt. Once that’s paid off, you can focus on your student loans and other less expensive debts.
If one of you has more debt than the other, try not to resent that person. The important thing is that you are both working together now to pay off the debt so that you can move forward with your financial lives.
Keep Certain Things Separate
Resentment can grow if you feel obligated to assume some responsibility for your partner’s debt, or vice versa. It’s okay to keep things separate and to make each individual responsible for paying back any debt that was assumed before you got together.
Even after you’re together, don’t feel that you need to take on debt for your partner. Co-signing for a loan puts you at risk financially, especially if your partner has a history of skipping out on debt. Agree at the beginning that you won’t co-sign for loans together, unless you both benefit from them.
Plan for Joint Debt
If you do decide to take out a mortgage or other major loan with your partner, there are a few things you can do to minimize arguments and prevent issues from cropping up in the future. First, it’s a good idea to wait until you both have a good credit score before you apply for a mortgage. Even if one of you has a score over 800, if the other is at 550, you won’t get the best rates on a loan.
It doesn’t sound romantic, but drafting up a partnership agreement before you take out a loan or buy a home can protect you both in the long run. The agreement, sometimes called a home-buying prenuptial, outlines who is responsible for what and what happens if things don’t work out between the two of you. Putting something in writing and signing on the dotted line can save you both a lot of headaches if things don’t work out or if you suddenly need to sell the house.
The thought of talking about money, especially with someone you love, may make you very uncomfortable. According to a survey conducted by Wells Fargo, 44% of people ranked personal finances as the most difficult topic to talk about. Many people would rather talk about death, politics, and religion rather than what they earn, spend, or owe.
However, if you want to have a long and happy relationship with someone, one of the first things you’ve got to get over is your fear of talking about money. Letting financial concerns simmer beneath the surface leads to fights – and in many cases, those fights lead to break-ups or divorce.
How do you handle talking about money with your partner? Have you been able to avoid any major disagreements?