REMARKABLE RELATIONSHIPS – Relationships and Money

Money can be a key problem of communication in relationships. It brings to mind the problem of oil and water – they simply do not mix. However you can shake them up and the oil will be held in suspension – which is a way of mixing the two together. Equally you can mix relationships and money – you just need a particular way to do it.

Six key points to remember:

1) Make decisions ahead of time This may sound like a no brainer but for many the opportunity to have ‘that’ conversation passes and then neither want to bring it up so it goes unmentioned until you hit a problem. Better to have the conversation before you get to that point.

2) Make the decision – joint or separate money This is a key question and one to be discussed openly and honestly. And openly and honestly is the magic ingredient here. If one side has a strong opinion and does not listen to the other then further down the road you will find resentment creeping in. I have had both in my current relationship – in the beginning we had joint money but when we started to have our businesses in different countries we split it up. It was only then that I realised what a stress having joint money was. It wasn’t that either of us were spendthrifts – we weren’t. But we did have different priorities. By being individually responsible for our money it made it easier. This was not about both earning equally – we have and do subsidise each other. But once that money is in our individual accounts it is our responsibility how it is used.

3) Have a joint account for joint expenses. This makes life so much easier – especially if you do not agree totally with each other how money is used. By having a separate account for joint expenses that is paid into by both parties, if both are earning, you both know that the ‘survival’ level of money is taken care of. The amounts you pay in may be equal or may be pro rata depending on the level of earnings. It is an agreement between you both.

4) Always talk about any debt you want to take on. Ensure that both of you are on the same page. By agreeing all debt up front, and who is responsible for paying it back, you avoid arguments. This is also true for credit cards. Talk about how you want to manage credit cards – do you want them paid back at the end of each month or are you both ok with having a certain balance on your cards? If you are ok with a balance on your credit cards, how much? At what monetary level does a purchase need to be discussed beforehand? This will help you build trust around debt.

5) What kind of savings do you want to have? Firstly decide what saving you want to be doing. Is it just long term, as in pension, or do you want a fun savings account for those lovely holidays or new car? How are these accounts managed? If you have separate accounts are your savings separate too? Think about what you want to do with that money ahead of time.

6) Acknowledge that you may have different ideas about money. That does not make either one of you wrong but it is important so that you can work out the best way to work together. I have seen in these kinds of relationships that individual accounts often work better. Have a joint account for joint expenses, an agreement how you manage the debt, the savings etc and then an agreement that with what’s left over it is up to the individual what they do with it. The saver may want to save the spender may want to spend – and that’s fine. Neither is right or wrong – it is up to the individual. We all have different ways of looking at things and money is a very emotive issue for many. By talking about things up front and honestly you stop a lot of grief before it can even get going. You can mix the oil and water of relationships and money and catalyst to do that is communication. Follow the key points above and you will be going a long way to getting rid of one of the most contentious part of relationships And – you get to live even more happily together.