Marriage is a partnership, and like any partnership, it requires effective communication and collaboration. However, when it comes to finances, many couples struggle to see eye-to-eye. Financial issues are one of the most common sources of conflict in marriages, and if left unresolved, they can lead to serious problems, such as debt, bankruptcy, and divorce.
According to financial expert Larry Burkett, eighty-five to ninety percent of surveyed couples claim finances were the main reason for their divorce (Rainey 19). Soaring over adultery, abuse, and incompatibility, financial problems are disintegrating marriages of all age groups.
One of the keys to a financially stable marriage is by incorporating proper accounting practices. When couples implement proper accounting practices in their marriage, they can have a clear understanding of their financial situation, identify areas of improvement, and take corrective action when necessary.
Below, we’d discuss some financial practices that ensure your financial life as a couple will be smooth sailing.
- Setting Goals
The first step in solving financial issues in marriages is to set common goals. This can be anything from saving for a down payment on a house, paying off debt, or planning for retirement. By setting common goals, couples can work together towards a shared vision and stay motivated to achieve their objectives.
According to Ramsey Solutions (5 steps to improve your relationship with money), unrealistic expectations pave the way for money and marriage problems, so set goals.
- Creating a Budget.
The next step in solving financial issues in marriages is to create a budget. A budget is a financial plan that outlines income and expenses over a certain period, typically a month. By creating a budget, couples can track their spending, identify areas where they can cut back, and make adjustments to achieve their financial goals. A budget can also help couples avoid overspending, which is a common cause of financial issues in marriages.
One fun way to make this happen is to set up budget date nights, at least once a month. According to Dave Ramsey, scheduling budget date nights brings the couple together because the trust factor is higher.
- Savings
Saving is essential in any financial plan. Couples should have a plan for saving money for emergencies, future goals, and retirement. By setting goals together and sticking to a savings plan, couples can avoid financial stress and achieve their long-term financial goals.
Saving also involves making wise investment decisions, by investing wisely, couples can grow their wealth and increase their financial security.
- Building an emergency fund
Another important financial practice is to build an emergency fund. An emergency fund is a savings account that is specifically set aside for unexpected expenses, such as medical bills or car repairs.
As a couple, it is important to save for rainy days, sometimes, the unexpected happens; a health emergency, or a loss of a job. By building an emergency fund, which is usually 10% of your gross income, couples can avoid taking on debt or dipping into their savings in case of emergencies. Paying for health insurance is also a form of an emergency fund.
- Building wealth by Investing
One of the ways to stay financially stable and build wealth as a couple is by investing. Investing is a way to increase one’s income and secure financial stability. Aside from building an emergency fund and saving in a bank, explore other investment options that make your money work for you and multiply your earnings as a couple. Opt for stocks, mutual funds, or invest in real estate.
- Live within your means as an individual and as a couple
Living within your means is one of the most beneficial financial habits to cultivate. As a couple, prioritizing your needs over your wants is an excellent way to live within one’s means. If what you can afford is to live in the cheaper region of your city, don’t go renting an apartment in a highbrow area.
- Communication and Collaboration
Proper financial practices require effective communication and collaboration. Couples need to be open and honest about their financial situation, including debts, income, and expenses. By working together, couples can make informed decisions and avoid surprises that can lead to conflicts.
Additionally, couples need to be willing to compromise and make sacrifices to achieve their financial goals.
“If money isn’t something you are comfortable or used to talking about, consider starting with a money date. Perhaps you’ll already have some financial agenda items to discuss, but if not, consider beginning with an open discussion of your financial history, and any attitudes about money you may each be bringing into the relationship” Fidelity Investments (3 tips for marital financial bliss).
- Seek professional help
Finally, If financial problems become too overwhelming, couples may need to seek professional help from a financial advisor. A financial advisor can help couples create a financial plan and offer advice on investments and debt management. Professionals can provide couples with unbiased advice and support. It can also help couples address any financial or emotional issues that may be causing stress in their marriage.
Financial issues can cause severe problems in marriages, but by adopting proper financial practices, couples can avoid conflicts and strengthen their relationship.
References:
American Psychological Association. (2015). Stress in America: Paying with our health. Retrieved from https://www.apa.org/news/press/releases/stress/2014/stress-report.pdf
Lusardi, A., Mitchell, O. S., & Curto, V. (2010). Financial literacy among the young. Journal of Consumer Affairs, 44(2), 358-380
National Endowment for Financial Education. (2015). The cost of financial stress in the workplace. Retrieved from https://www.nefe.org/Press-Room/News/2015/The-Cost-of-Financial-Stress-in-the-Workplace.aspx
“5 Simple Steps to Improve Your Relationship with Money” by Ramsey Solutions.
Retrieved from https://www.ramseysolutions.com/relationships/the-truth-about-money-and-relationships
“How to Keep Money from Ruining Your Marriage” by Dave Ramsey.
https://www.ramseysolutions.com/relationships/how-to-put-an-end-to-money-arguments
“Marriage and Money: How to Get on the Same Page” by Fidelity Investments. Retrieved from https://www.fidelity.com/learning-center/smart-money/marriage-tips
image credit https://www.verywellmind.com/financial-cheating-2302866
