Your Money

Financial Friction: having different spending habits needn’t end in divorce

- May 18, 2018 3 MIN READ

With money issues being cited by 22 percent of couples as a motivator for divorce, it makes sense to set some ground rules around your financial habits before they become issues for you and your marriage.

You’ve said ‘I do’ but now your spouse’s spending habits have got you thinking ‘I don’t’.  Before things get out of hand it’s time to set some boundaries around spending and saving and rescue your relationship in the process. Like most marital challenges, communication is key.

It’s no secret, fighting about money can place a huge pressure on even the most loving couples. But financial stress doesn’t have to get the better of you, Nor do you have to let it destroy your relationship. Ending financial friction takes planning and commitment but it is possible.

Start with full disclosure

Many of us have been raised to think that talking about money is garish. So, to imagine discussing our finances with our significant other can make some of us cringe. However, if you’re in a serious relationship or about to get married, it’s time to let go of the discomfort and have a chat about cash… Now is the time to discuss any outstanding debts, loans, income sources, investments or other financial assets or obligations. Have you got a $30k HECS debt that you have to pay off? Does your elderly parent rely on you for financial support? Did you rack up loads on your credit card during the New Year sales? Before you take a walk down the aisle, t’s time to divulge all.

Are you a spender or a saver?

What’s your money mindset? Understanding your financial temperament and that of your partner will go a long way towards avoiding arguments. How you and your partner view money can be very different. A person’s parents’ attitude to money can also have an impact on how they deal with debt. What was your parents’ attitude to money? Is it different to that of your partner? Did your parents budget and save or were they big spenders? Often conflict arises in a relationship when one partner is a saver and the other a spender – but it is also important to understand where these habits stem from. Sometimes a past issue during childhood can impact a person’s response to money…

Set financial goals together

If you really want to be in sync with your partner, it is important to set financial goals together. Whether that means saving for a vacation, putting extra money into your super or squirrelling away cash for a house deposit. What’s most important, is that you are both on the same page. Set your eyes on the prize and don’t forget to check in every once in a while to make sure your goals haven’t shifted. This is really critical if you are in a relationship where one partner is the breadwinner, as sometimes partners can become resentful about where and how money is being spent or there can be guilt associated with not earning a wage.

Set a budget

Maybe the word ‘budget’ is anathema to you, but if you want your relationship to work it’s important to set a household budget. There are plenty of free apps available these days that can help you track your accounts and transactions to give you a realtime idea of how you are tracking. It’s worth checking out what’s available on the app store or Google Play to see what works for you.

Ditch the secrets

Many couples keep financial secrets. A recent poll found  around 6 million people in the US are concealing accounts from their spouse, while around 20 percent have spent $500 or more on items without telling their significant other. Lying about big purchases can prove toxic to relationships – so come clean now!

Decide what purchases need to be discussed

Set some ground rules. Make a rule about what purchases need to be a joint decision. This will be different for every couple. What generally works best is making joint decisions on big ticket items. You can also set spending limits on items like clothes, toys and recreational activities. It’s often a good idea to consider the cost per use.  A $1000 pair of Louboutins might be difficult to justify compared to a $1000 for a work suit which will be worn far more often…

Get help if you need it

If money arguments are getting you down, consider calling in an expert. A financial adviser can assist you and you partner to come up with a plan to get your savings and spending in line with each other.