How to Talk To Your Spouse About Money

Money causes more friction, heartache and anxiety in relationships than just about any other subject. Most couples report that it is often the center of their arguments. In any relationship, there will be differences based on your family history and myths about money, your earning situation, your spending patterns, and your future dreams.

Consider this from The Secret Meaning of Money by Cloe Madanes:

Everyone worries about money.  Some of us feel that if only we could have more money, our lives would be greatly improved and we could find happiness.  Yet those who have a great deal of money seem constantly worried about making more, how to spend it, and the possibility of losing it.  Everyone worries about money, and no one seems satisfied with how much they have and how they use it.

Well, with that worrisome outlook, let’s try to get a bit more creative in figuring out how to shift the conversation with your spouse around money.  Strive to make it about building collaboration (instead of competition and frustration) as you try out some of these ideas:

Make sure you have a common language and understanding as you work together through your relationship.

Both people need to know what the household monthly income and expenses are, and what the priorities are for any extra funds (pay down debt, experiences like travel or entertainment, retirement savings).  If there is a joint account to cover household expenses, consider a ratio approach based on income levels to keep it fair, rather than 50/50.  If one party has more debt coming into the relationship, this has to be factored into the discussion to be sure payments are made on time and responsibly to protect your credit ratings.

Talk openly to each other.

Discuss what you care about and consider whether the businesses where you shop and make purchases, and even where you work, match your belief system.  Having strategic intentions about your money can be empowering as you show the world what you value when you spend your hard earned resources.

Determine a set amount (for example, $100) that you promise to consult with the other person on before you spend more than this amount.

This allows each person to make small impulse purchases without consultation or fear of judgement. However it also helps avoid surprises in the bank account or credit card statement.  This amount helps set priorities around spending on home renovations, travel, or other big-ticket expenses.  The main concept is to keep the conversation flowing about money.

Create a motivation to save or avoid spending on extras.

For example, if you need to do a “fiscal fast” and avoid dining out for a few weeks, make sure to implement an Experience Reward at the end of the timeframe.  Research has shown that when people spend money on experiences, it creates a lasting positive impact on them—often the memories and the re-telling of the stories of this shared experience keep the couple connected.  Experiences can be travel, a sporting event, a concert or play, or any other activity you both enjoy together.

Learn how to “fight fair.”

Once you’ve been in a settled relationship for a while, one or both of you may make a bad money decision—we’re human.  It may, or may not, have been under your control, but you may have ended up at a place where financial worries have taken over your household and trust is eroding quickly.  If you’ve built up large credit card bills, try to honestly consider how that happened—were you trying to avoid some other emotional issue and used retail therapy to ease the pain?

In Stop Fighting & Start Talking, Ed Coambs describes the Stop, Drop & Roll method to move arguments to resolution:

STOP—Recognize that you are entering a conflict (it may show up as screaming or yelling, passive-aggressive behavior, or seething resentment)

DROP— Drop your defenses and focus on what the other person is really upset about.  There’s a good chance that you may not fully recognize the source of their frustration.

ROLL—When you really understand where the other person is coming from, you must be ready to roll with the punches.  Ultimately, your spouse will surprise you more often than not regarding the source of conflict and the way it makes them feel.

You can read more tips like this on his website.

Think outside yourselves to build gratitude and share your abundance.

If there is a not- for- profit where the mission speaks to your soul, work together as a couple and consider allocating a portion of your money (and time) in support of this. The gratitude research of Dr. Robert Emmons (UC Davis) found that people who regularly practice an attitude of gratitude have on average a 7% higher income than those people that don’t (and you’ll spread some good in the world).

Remember to keep your spouse’s feelings at the forefront of your thoughts (even when you’re seething about money). Money conversations are necessary to keep life moving forward, however LOVE conquers all.  To recap:

L—Learn about each other’s money beliefs and listen to the other person

O—Organize your money behaviors with limits and rewards, and patronize businesses that match your values

V—Validate each other when you accomplish a goal like saving money

E—Expand your life together through experiences and helping others—money is the conduit, not the end game.


So You’ve (Unexpectedly) Inherited Some Money…What Next?

It can feel like a rollercoaster when you unexpectedly receive news of an inheritance. It could be completely out of the blue, or it could include a larger or smaller sum than you thought might be available. Here are five steps to navigate your new financial situation, and how to best handle it when others may be involved.

Step 1: Acknowledge that there are emotions attached to this money.

Many inheritors skip this first step. You could be be feeling excitement, sadness, anger, jubilance, or anxiety. No matter what you are feeling–and how often it changes over the coming weeks and months–it is important to appreciate that these feelings are natural and appropriate.

Step 2: Appreciate that nothing needs to happen fast.

Resist the urge or impulse to make a big purchase or change your lifestyle until you have thought through all the implications of each choice. Also, resist the pressure when others ask you to loan or give them money. By approaching this as a process and consider all options before using any of the money, you will be happier when confirming a loan or gift will be an appropriate use of funds down the road.

I recommend at least a three-month timeline for this process to consider ideas. This time period allows you to balance your emotions about honoring the person who provided the inheritance, and letting go of the past so you can plan for your future.

Step 3: Set up a strategy for reviewing options with a group of trusted advisors.

Ideally, these will be people without an agenda for the money.

Spend a little time dreaming about saying YES to YOU! How do you want to use the money for short-term and long-term outcomes?

For some people, the dream could be starting a business, paying off a loan that causes you anxiety, taking a big trip, buying a house or making charitable donations—all of these are noble thoughts and deserve full exploration of the pros and cons.

Get input from this group (colleagues, friends, family, advisors) to help you articulate these dreams and how they connect to who you are and your future. This group can also be your accountability checkpoint when you have an impulse to spend the money. Sometimes a counselor or coach is helpful to process these ideas and the associated emotions. Ultimately, you can come up with a plan with categories for the money , for example:

  • 5-10% for a splurge (BIG YES TO YOU!)
  • 50% investing for the future (you and your family legacy)
  • 40-45% for your dreams that you have created and discussed with your advisors (starting a business/gifts/loan payoffs/charities etc)

Along the way, stay curious about the process and your reactions.

Step 4: Recognize that this is a great opportunity to take a look at your inherited beliefs about money.

Decide if what worked (or didn’t work) in the past is really a match for the person you are today.

“Our past is a story existing only in our minds. Look, analyze, understand, and forgive. Then, as quickly as possible, chuck it.”—–Marianne Williamson

I recommend reading The Emotion Behind Money, Building Wealth from the Inside Out by Julie Murphy Casserly, CFP. This book can be helpful as you navigate these financial choices.

Step 5: If you choose to invest some of the money, look at it through fresh eyes.

Was it invested using a 1980s model with companies that do not behave in ways that match your values? If it was inherited from an elderly relative, perhaps it was invested in a risk averse manner that matched them.

However, you are younger and more interested in building a solid nest egg for the future, and you may be willing to take more risk to hopefully generate higher returns. If you resonate with the triple bottom line philosophy, specifically seek out companies that fulfill these characteristics (they make a profit and make a difference in the world). This investment strategy leaves a legacy for future generations that clearly states what you believe in and value.

Rejoice that you have been given this opportunity to responsibly navigate this inheritance.

Have questions about an inheritance or need a consultation for your investment strategy? Contact us.