A monthly series answering questions that I get from you! Have a question that you’d like to see answered in a future month? Email firstname.lastname@example.org
“I was wondering if you have any advice for when your husband and you don’t agree on spending. I saw your money arguments article but we are fighting about the fact that he loves to buy new clothes and I think it’s excessive! How do you find a resolution to something like that?”
I love this question because I feel like it’s something we ALL deal with when we’re figuring out how to combine a life (and money) with a partner. This was something Jordan and I addressed during week 1 of marriage. How romantic. We have different spending patterns and rather than get on the same page about every purchase, we each needed some independence. We both value independence.
There are two things that I’ve found incredibly helpful:
- Keep a separate allowance account for each person’s discretionary spending, and
- Get really clear on life goals
For the first point, Jordan and I both have our separate allowance accounts that we use for personal spending money. Our paychecks are deposited into a joint account, we pay all of our bills and make transfers to savings/investment accounts from this joint account. We also have an automatic monthly transfer that moves a set amount of money from our joint account to each person’s personal checking account.
We can use this money, however, we want to with no judgment from the other person. Or we can choose to save it and have it build up in there until we use it for a really big purchase.
I know some people don’t like the idea of keeping anything separate from their partner when they’re married, but we’ve really enjoyed having that freedom.
And an unpublished study in behavioral finance shows that couples who put money into a joint account first and then transfer a set amount to a personal spending account end up saving more in the long run. Science agrees with our approach.
I have an article that details more about how we handle our shared money here.
If you’re worried about keeping track of money outside of a joint account, it’s not complicated. Automated transfers will become your best friend. Now that we have this system up and running we spend less than 15 minutes a month reviewing our money. It’s seriously easy. Here’s information on how we manage our accounts (plus a download so you can put this system to use for yourself).
The second part of this – and I think really the foundation for making this work – is to get on the same page about life (and relatedly, financial) goals. Both Jordan and I love setting goals separately and there was definitely a learning curve when we had to start setting goals together.
Rather than sitting down and asking each other “what are your financial goals” (because that’s not really a great conversation starter), we instead switch up the question and ask each other, “How do you want to live?” This question has become our new favorite conversation topic when we’re out on walks or running errands around town. It’s a fun question that not only gets us talking about goals but gets us thinking about the longer term implications of how we’re spending our time and our money each day. Deep, I know.
I’ve detailed out how we don’t necessarily start with the financial goals in an article here.
Once we’re really clear on our life goals, it makes talking about spending so much easier. If Jordan is shelling out for some socks that I think are too expensive, (seriously this is a real example – I’m crazy) I know that he’s doing it mindfully. It’s not frivolous spending with total disregard for our goals. And if I do worry that he’s gotten off track, or vice versa, it’s easy to gently remind the other person about the life goals we have.
My husband and I have different approaches to risk. Recently we have been talking/arguing about how we should invest as we have slightly different risk appetites and approaches. it mattered less when we both were earning tons of corporate income but now neither of us is really doing that, so now it matters more. I used to not care [about how we handled money] but now I care.
Having a new financial situation – expected or unexpected – can send even the most rock solid money relationships into a tailspin. All of a sudden the stability that you had from a paycheck is gone and the unpredictability can be terrifying.
The amount of risk that you take with your long-term investments really shouldn’t change because of your short term situation. I’m guessing that it’s not really the risk appetite with investments that you’re butting heads about most often. It might be more the uncertainty for the short-term future (how to pay bills!) and the fact that as you mentioned, you’re just now interested in money. If your husband has been taking the lead with money, he’s likely really surprised to see you taking an interest now.
Rather than jumping straight into the tactics of where your money is going, try sitting down with your husband and having a really honest conversation about goals. I always start with the life goals part of things because once you have the end destination in mind, figuring out how to get there is so much easier.
You can start with questions like:
- How long do we see this situation lasting for?
- Now that we have the opportunity to look at our money and our time, what kind of lifestyle changes do we want to make? (ie: do we want to go back to the corporate income or is this a time for an intentional switch)
- Does this change our long-term life goals?
- What do we need to feel secure?
For example, maybe this isn’t a long-term situation (you’re both planning on heading back to a corporate role in the next few months), but in the meantime, some of the short-term bills are stressing you out. How can you bridge that gap right now? Are there some budgeting or spending habits that you need to address? Is there a short-term way to bring in some cash now to help alleviate the stress during a transition period?
Or maybe it is a long-term situation and you’ve both left the corporate world indefinitely. How does that change your long-term life goals? It may mean that for the next few years your long-term money priorities need to change. What will make you feel more secure during this transition period? A larger cash cushion? Paying down debt?
Don’t let the stress of a new situation keep you guys from getting into the real conversation of goals and what you each need financially to feel secure.
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