Issues about money are a leading causes of marriage problems in New Zealand and around the world and as mortgage brokers we see this all too often.
Ask yourself how often have things about money affected your relationship?
Sure, some people have serious money issues that may have been caused from a failed business, a bad investment or even a gambling or drug habit. These are specific causes that lead to financial issues and even financial ruin – they are serious issues!
Sometimes our personal money issues will affect our spouse and immediate family, but sometimes this extends to parents and other family especially when those people have gone as a guarantor for your loans.
Luckily most of us do not have money issues that are this serious.
Little Annoying Issues About Money
Most people in relationships will agree that they have had or still have some annoying little issues about money.
“the wife spends too much on clothes”
“the husband spends too much on fishing gear”
These spending patterns might not amount to much really; however often they do lead to resentment and can escalate into bigger money issues especially if a persons spending leads to a situation where there is not enough money left to pay the bills.
We Justify Our Spending
Do you justify your spending?
My father is a car nut – I cannot remember how many cars he has owned, but it is a lot.
I remember his justification for buying a new car; it’s really going to save money as this new car is more economical, a new car shouldn’t have any maintenance for some time and as a business vehicle there are some tax benefits too.
Forgetting that it just cost $60,000, my father justified to himself that it was a smart decision.
This is not uncommon and we all probably have examples where we have justified our spending.
In reality, spending is just spending.
Unless you are spending money on an income generating asset or tool, then when you spend money you will not see it again. You might go to the shop and buy a new jacket and it makes you feel better, be warmer, look nice … but it still leaves you with less money for something else.
It does not really matter how we justify our spending to ourselves or others.
Who Earns And Who Spends?
A very common situation about money that causes friction in relationships is when one partner earns more, but it is the other partner that spends more.
Before we got into a relationship we earned our own money and then spent our own money. We were in total control and while we might have had times where there was not enough money, we could really only blame ourselves – so we didn’t blame anyone.
In a relationship we have to come to terms that there is now another person who may e earning and/or spending money.
This concept needs both parties to a relationship to make adjustments in how they think and how they spend.
This can be tough when other factors influence things – like buy your first home, starting a family or taking time off work to study.
Like so many things in life it is good to have a plan before money causes any real issues and this is why I have come up with these 5-steps to fighting less about money.
5-Steps To Fighting Less About Money
Here are the 5-Steps to Fighting Less about Money;
1. Set a date – you need to set a date to talk about money.
Set a date where you can sit and talk about money issues before they become a problem. This should be scheduled into your calendars as a regular “meeting” each week, fortnight or month in the same way you would schedule any other meeting.
Too often money issues are raised in the heat of the moment and this almost always leads to friction.
2. Listen – it’s so important to listen intently at what your spouse is saying, why they’re saying it, and only then respond.
Sometimes – too many times – people get all wrapped up in the emotions of a money issue that they stop listening and miss the real issue which is often not about the money.
Listening to what your spouse is saying helps put you in their shoes and understand them better, which helps you connect better, respond better, and ultimately reach a common ground so you can work together to resolve any issues rather than working against each other.
3. Learn to let go – easy to say, but often harder to do!
Couples often have a hard time letting go even after they have made a decision or come to a compromised on a money issue.
When you and your spouse have agreed on something, move on and even if you are not 100% happy you need to learn to let it go otherwise it will continue to niggle away at you and will come out at an inappropriate time.
4. Design a shared vision – “shared” not adopting one person’s vision!
This is powerful and involves planning together for a common ground that you both take ownership in. Too often one person agrees to what the other person says so as not to “rock the boat” and therefore avoid any friction.
Having a shared vision does not need to mean everything is a compromise.
We recently purchased a boat and the decision on what boat to get was 100% my decision. In saying that, the decision to get a boat and the amount we spent was a joint decision. When we last purchased a computer that was 100% my wife’s decision as that is an area that she knows about and interests her.
5. Don’t take it too seriously – again this is easy to say but harder in practice.
Money is a serious issue and as we know it can lead to a host of other problems if not managed well; however life is meant to be fun too and when we take money too seriously we often find that we avoid the subject rather than embrace it.
Most people love to spend money, or at least love the “nice things” that money can buy.
Most people also know they need to earn money – that’s common sense!
I always suggest to people that if they set budgets they also need to have rewards. Instead of putting $50 extra a week into the home loan, why not put $30 each week into the home loan and the other $20 can go into another account which you then use to slash out and have a night out or weekend away as a reward for your efforts. You still get to pay off your home loan more quickly, but you also get to do something nice with your partner – it’s more fun that way.
The First Step
It is easy to talk about money and how you are going to stop spending and start saving; however unless you make a decision you will not change a thing. You need to take that first step.
Today you need to set a date with your partner to talk about money.
Agree on what you want to discuss and what you want to achieve, document it and review progress at the next meeting.
I like to measure progress and if you want a budgeting tool try PocketSmith.
PocketSmith tracks all of your spending directly from your bank account and this way
A Little Thanks Must Go To…
The inspiration for this article came from a blog I found called “confessions of a terrible husband” – a personal journal by Nick Pavlidis and contributing writers who are all committed to continuous improvement and personal accountability in marriage.
Please Share These Tips
The purpose of this blog is to help people avoid money issues.
You can help too by sharing this blog and/or any of the posts on StuartWillsBlog with people that you know or on your social media accounts.
Let’s work together to help put a stop to people’s money issues.
