Manage your finances together
Photo by: BjÃ¶rn SÃ¶derqvist
Mrs. Micah started a collective post that asked readers to share their best personal finance practices of the year. Here’s mine and it applies to those of you that are married:
Do your finances together!
Money problems and disagreements are the number one cause of marital strife and divorce in the US. The key to avoiding these problems is communication. I’ve discussed this topic before in these articles: How to get my wife or husband to follow a budget, In Financial Chaos? Pass the test, and 1 year ago today – 10 things we’ve done to regain financial control.
I highly recommend you face your money problems together, develop your financial plan together, do your budget together, save together, invest together…well you get the point. Frequently in a marriage, one person does the finances. This is generally the more detail oriented person, the geek as I call them (I can say that, I’m the geek). The other person isn’t involved, or least not enough. Money fights are generally for one of two reasons:
- The person not responsible for the money begins to feel controlled because they either don’t understand the finances or don’t have a say in how the money is budgeted.
- The person responsible for the finances gets frustrated because their spouse spends too much money, thinking in their mind that the overspending is intentional when in fact it’s really a result of the couple not communicating.
Working together on your finances solves this problem. When you both understand how much income you have, how that income gets allocated into your budget, and you agree on your short term and long term financial goals there really isn’t anything to disagree on. When you both partake in the process you both become accountable. When you develop and agree on your monthly budget together, the budget (that you both agreed to) becomes the controller of your finances.
Have a budget meeting
One of the key techniques we use to ensure we do our finances together is to have a weekly budget meeting. My wife and I meet each Monday night after the kids go to bed and we review our budget. Since I’m the geek, I update the budget and print out all of our expenditures. I update how much is remaining in each budget category and print her off a copy. We review the categories and adjust our budget if necessary. There is no, “You spent too much here” types of phrases. If we overspent in a particular category we pull out from another. Remember, unless you had a unplanned windfall of cash, the income is generally fixed and all you can do is adjust your expenses.
What if you can’t pull from another category? Then you pull from your emergency fund.
Yes it really is this easy
I know, I sound like one of those late night infomercials or knife commercials, but it really is that simple. The extent of our money disagreements now is just discussing how much to put in each budget category. The solution is to just split the difference.
I’m not really sure why this simple and easy to follow process occurred to me so late in our marriage, but I am just thankful that it did. Genesis 2:24 tells us: “For this reason a man will leave his father and mother and be united to his wife, and they will become one flesh.” For this reason alone we should do our finances together, as one flesh.
Funny how it’s so easy to miss the obvious. If this is something you would like to start doing in your marriage, but your spouse is reluctant, read my article How to get my wife or husband to follow a budget for some ideas. You can even leave a comment or contact me and I’ll see if I can help.
Do you manage your finances together? Do you disagree about your money? Let me know what your thoughts by leaving a comment below!