Sorting Out Your Finances As A Couple

 “Money can’t buy you happiness” is one of those sayings most of us have grown up hearing although maybe an add-on should be …….” but lack of it can make you very miserable, especially in our culture”.

That sounds longwinded though and doesn’t give us much hope if we’re really struggling with money.  Is this struggle better or worse if you’re part of a couple?  Everyone has different ideas – it can be good to share your worries and feelings with a partner, but not if they’re totally unsympathetic, dismissive or unworried themselves.

For most of us, when we first meet our partners, money is one of the last things we want to talk about.  Other things are more of a priority because, after all, we don’t know if this relationship will ultimately work out.  So, interests in common, attitudes towards our own families, friendships and how compatible we are sexually often take precedence.

However, more of us are now experiencing financial uncertainty, hardship and unemployment than in previous decades and it’s time to talk about the reality of money issues before they develop into something that can ruin our relationships.

Someone’s financial habits are an incredible insight into his or her values and ethics. That doesn’t mean that having a lousy credit score is a reason to break up, but if you find that your new love interest doesn’t handle money responsibly, you have to question what else he or she isn’t going to be upfront about.  Most importantly, don’t think they’ll change overnight – they won’t, even with you loving them to distraction.  That will see you through for a while but probably not long-term!

Our attitudes towards money are often formed when we’re still children, even though these weren’t conscious thoughts and attitudes.  If you come from a family where people enjoyed their money by taking regular holidays, eating out and buying clothes without much thought about future security, it can be hard to understand a partner whose ideas can seem ‘penny-pinching’ and ‘tight’ because they refuse to waste food, only buy clothes when they need them are already buying their own house when you meet them.

This is the time to talk about deeply held values, feelings about sacrifice and possible mutual goals regarding the future.  If you find talking about money difficult, it will pose even more of a problem if one of you is made redundant in the future and your income is effectively halved.

When someone loses their job there are often feelings of panic, guilt, fear, blame and helplessness. People under this sort of stress often cease to acknowledge or even notice the kind and helpful things their partner does, only responding to irritating habits that are accentuated by worry. This in turn makes it harder to tackle a new budget and priorities. If people are honest and compassionate towards one another, they can learn to work things out and plan ahead for a better future.

A lot of relationship dynamics get played out within a changing financial environment, such as one person going on a spending-spree to get back at their partner. To build a strong future, here are some tips to help you along the way:

  • Control your spending (easier said than done for most of us!). This is one of the first ways that differences can occur – your partner takes pride in taking a flask of coffee to work whereas you like nothing better than meeting friends for a coffee or beer on the High Street.  Compromise might be one way to deal with this.

One of the biggest ‘don’ts’ is to do with credit cards – try to use them only if it is an emergency or for health care. If you have savings, try not to dip into them unless you both consider them absolutely necessary

  • If you already have debt, handle it as a couple: make a plan about how you’re going to pay off any existing debt. This may involve drawing a line in the sand -saying that your partner’s debt isn’t your problem isn’t going work. Even if the debt existed before you got together your credit rating can be negatively impacted, as well as the bottom line being how much money the two of you are paying monthly in interest charges.
  • Make a plan to pay off existing debt. Drawing a line in the sand and saying that your spouse’s debt isn’t your problem is not going to work because even if the debt existed before you married, expense absolutely necessary.
  • Try to be realistic. We’ve all heard about making a list and it can be time-consuming as well as boring, but listing your expenses does help you to cut back. When you compare your expenses to your income, it can be a wake-up call.

You won’t read this on many money forums, but adding ten percent to your expenses is a realistic way to work them out – there’s always something that happens that we haven’t budgeted for – your child wears out their shoes in three weeks (how does that happen?!), you scrape the car when you’re reversing off the main road or your mother expresses a sudden desire to have her birthday tea at the most expensive hotel in a fifty mile radius.  Adding ten percent might help you cope with one of those (although not all of them in one month!).

  • Identify where you can’t cut back and where you might be able to do so – looking for a cheaper telephone plan, eating out less, using the car less. Some people take to these ideas very enthusiastically, deciding to grow their own vegetables or do more home baking – take it slowly, one step at a time. What you started with zeal in September can look very unenticing by January.

  • Your bank account(s)
    Here’s how I suggest every couple organises their cash flow: Create three accounts—one for you, one for your partner, and one joint fund. Once you’ve determined the total cost of your shared living expenses, both of you need to contribute your portion of these costs to the joint account each month, based on your share of household income.

  • Finally, try not to run away from your problems – it will just make your situation worse. Don’t try to escape from your unemployment and financial problems. Overeating, smoking, drinking, over spending, not sleeping, etc. will only make your situation worse. Remember the importance of taking care of yourselves, both emotionally and physically. That means regular sleep, a healthy diet, exercise, taking care of yourselves and each other and, most of all, having FUN!

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