As I was sitting at an outdoor wedding this past weekend, sweating and listening to the couple exchange vows, promises and one well-timed kiss, my mind began to wander back into the financial realm.
Having been to dozens of wedding in my lifetime, and having witnessed thousands of couples’ financial lives, I always feel like it would be worth everyone’s time to just spell out the financial challenges that lie ahead in every marriage, or any committed relationship for that matter.
Finding your way onto the same financial page as your significant other is one of the smartest things you can do for both your marriage and your future. You’d think that your aligned interests would help you in this endeavor, but it doesn’t work that way. You’re basically set up for failure from the beginning, and the sooner you realize that and put a real plan together, the better.
Your problems began before you ever knew your sweetie. You were raised by different people with different values in different circumstances. This is to say that your relationship with money was crafted by one or more people who may or may not have had any idea what they were doing with money. You can have a perfectly “normal” childhood, yet still be the product of a financial ignoramus. You likely won’t realize this until you’re deep into adulthood. Combine this baggage with the other person’s baggage and you’ve got yourself a ton of baggage.
Distilled down to the essence of the problem — the chances of you and your significant other getting the exact same money education are slim to none.
No matter what financial background you come from, I encourage you to follow my four rules for a financially successful relationship with your significant other.
No. 1: A dollar doesn’t equal a vote. Unless you experience an unbelievable coincidence, one person is going to earn more money than the other person. But as long as you remember my first rule, that won’t be a problem.
If you earn more money than your significant other, you don’t get to call any more shots than they do. You don’t get a more powerful vote if you happen to earn more money. Feel free to violate this rule if you don’t care to stay happy and married. Your combined earnings equal your household income, and that income is for the household’s needs, wants and goals.
No. 2: Develop household goals. I find this to be the most challenging aim for most couples. I have this little scale I call the stuff/stability scale. On one end is stuff and on the other end is stability. It’s hard to create joint goals because it’s tough for two people to be at the same place on the stuff/stability scale.
One person is more interested in acquiring more and better stuff and the other person is more interested in creating more and better stability. And when you have extra money laying around which you can assign to financial goals, the stuff person is gonna want more stuff and the stability person is gonna want more stability.
No. 3: Do not revenge spend. At some point in time in the relationship, a person is going to make a mistake — accidental or otherwise — and when that happens, the other person shouldn’t break rule number three: Do not revenge spend.
It makes zero sense to punish your partner by committing an additional financial atrocity. If one person makes a financial decision they shouldn’t, don’t adopt an eye-for-an-eye philosophy. Just pick up where you left off and get back to work on the next household goal.
No. 4: No loners. This final rule is a vital rule. One individual cannot be left out of the household’s finances, no matter the circumstances. It’s not fair to leave one person solely responsible for a couple’s financial future.
If your partner suffers from good behavior lapses from time to time, leaving them out in the dark is the worst thing you can do. Your household finances are only as good as your weakest link. Strengthen the weakest link, don’t isolate it.
Sharing your financial life with someone is very difficult. It requires a tremendous amount of sustained effort.
When your partner falters, as they will, just as you will, you’re to be there to hold them accountable and then move forward toward your household goals. The alternative is easier, but it’s not sustainable.
Have a question for Pete the Planner? Email him at AskPete@petetheplanner.com or visit petetheplanner.com.