The fact that you’ve committed to being someone’s life partner doesn’t mean you share the same approach to money. Far from it: 73 percent of married couples consist of one saver and one spender, reveals a survey conducted by Bethany and Scott Palmer, married coauthors of The 5 Money Personalities: Speaking the Same Love and Money Language. This combination can lead to frequent conflicts and flat-out financial dishonesty. Nearly one third of couples polled admitted to keeping secrets about their spending habits, according to a recent study by Harris Interactive. To stay together (and happy), it’s critical to get on the same team.
Is your partner the type who will invest in a pricey child backpack for the one time you’ll ever go hiking? Or, by contrast, does he (or she) insist on squirreling away extra cash toward retirement even if it means skipping a new swingset for your kids? Understanding his underlying money values is an essential first step if you hope to reach a compromise, says Bethany Palmer.
Fewer than half of all partners discuss financial matters regularly, despite the fact that maintaining an open dialogue is the most effective way to avoid budget fights, notes Scott Palmer. Sit down with your other half once a month to update your money goals and discuss your needs and wants so that you can work toward achieving them together.
Regardless of your work status, you and your partner each need some financial autonomy, says Jean Chatzky, founder of Money School, which offers virtual financial classes. Some couples set up a monthly allowance per person. Others put aside a percentage of their individual earnings to spend as they please, whether it’s on a workout class or concert tickets. Come up with an arrangement you can both live with, and revisit it every few months.
Agree to discuss purchases that exceed a set dollar amount in advance, whether it’s $50 or $500, suggests Brad Klontz, Psy.D., coauthor of Mind Over Money. This “checks and balances” approach ensures that your big buys are joint decisions—and avoids unhappy surprises when the bill comes.
Whether you’re a saver and your partner’s a spender (or vice versa), you can each make minor adjustments in your money-management strategies to find common ground.
If You're a Spender...
Born shoppers need to cut down on impulse purchases by evaluating buying decisions more carefully. If you fit the description, try adopting these strategies to improve your money habits and build a healthy savings cushion.
If You're a Saver...
You have clearly defined financial goals and track your monthly living expenses (such as food, rent, and child care) closely. Chances are you already have emergency, retirement, and college accounts in place. If not, make sure you do.