Finances and your spouse

loving-ajamu

Ajamu Loving, CFP®, Ph.D.

Our past determines our present and the present shapes our future. Whether it’s a positive or negative experience, it influences our habits – especially with money. When working with coupled clients, how often do you see this manifest? My guess is daily!

Money problems are often identified as one of the top reasons for marital troubles and can even lead to divorce. Put yourself in your clients’ shoes: Did you know your spouse’s spending habits before you were married? Were you discussing debt during Valentine’s Day dinner? I’m sure you covered favorite ice cream flavor on date number two but how about credit score?

With so much of your life tied together (in the best way possible, of course), it’s a no-brainer that your coupled – or soon to be coupled – clients may rely on you to help facilitate a discussion of finances. So, how can you help?

A good place to start is by guiding your clients through a few questions that will help them talk about themselves first as individuals. Whether you have been married for a long time or are a newlywed, you may have your own personal financial goals. Retirement may mean a boat and a house in someplace warm for one, whereas it may mean a downsized home within walking distance of grandchildren for the other. Encourage your clients to answer honestly and be sure they know this is a judgment-free zone.

  • Reflect on your upbringing. Did you have an allowance as a child? When did you get your first job?
  • Be honest about your natural behaviors. Are you a saver or a spender? Do you pay off your credit card regularly?
  • What have you done well?
  • What can you learn from?

After discussing personal financial goals and attitudes, you can facilitate a conversation that allows couples to approach goals they are working toward together. Identifying common ground is key. Begin with their current financial situation, which is likely the conversation you’re having with your clients anyway. This includes things like joint and individual assets, income, joint and individual debt, and living expenses. You may already have a good idea of the situation, but sometimes writing the numbers down and discussing them as a team makes them more real.

Then tackle the good stuff. What are the priorities for the next 1, 5, and 10 years? Ask the questions:

  • Are you saving to buy a new home, renovate your current home, or buy rental property?
  • Have you started a retirement savings plan together?
  • Do you have an emergency fund in the event of unemployment or serious illness?
  • What are your priorities in life – as they pertain to finances and outside of finances?

Talking about finances with couples may seem easy, so what’s the problem? Why do so many couples cite money as one of the main areas of discord in their relationships? Communication is also on the list.

How and when couples have these discussions are just as important as setting goals and tracking progress. It’s also important to remember that this is not one discussion. It’s an ongoing dialogue most often during the boring, mundane parts of everyday life, so these things may not normally come up in an annual meeting with you:

  • Discuss personal budgeting.
  • Set guidelines for gifts and other extra expenses.
  • Talk about how you would help a family member struggling financially. If someone asked you to borrow a large amount of money, what would you do?
  • Consider if you would ever have a family member live with you – in-laws, adult children, and so on.

It may seem easier to discuss these topics when they occur, but it helps to set expectations before these events happen. They say practice makes perfect, and that is what this is about. The best coaches understand the strengths and weaknesses of their players. They bring out the best in each so that the team has the greatest chance to win. It’s hard to break up a winning team, and playing by the same rule book can make all the difference.


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For financial professional use only. Not for public distribution.