Everyone knows that managing finances can be a touchy subject, especially for couples. In fact, managing couple's money is a lot like learning to dance. Sometimes you step on each other’s toes, but when you find your rhythm, it's pure magic. Here in 2024, with the cost of living doing the cha-cha all around us, mastering the art of budgeting as a team is more crucial than ever. Not to mention, it's the ultimate test of your relationship's harmony and resilience.
So, where do we begin this delightful dance without turning it into a wrestling match? That's where this guide comes in handy. From setting up a joint bank account to clever methods to save money, we've got you covered. Think of this as your financial GPS for navigating the sometimes bumpy but potentially rich roads of shared finances.
One of my friends once said, "Sharing finances feels like jumping into a pool. It's cold at first, but you eventually feel refreshed—and maybe start doing laps." Truth be told, she had a point. Combining the financial habits of two different people can be quite a splash. But worry not, we’ve got just the right pair of floaties for you.
To begin with, setting up a joint budget can be a game-changer. It ensures that both partners are on the same page financially. How do you make this less of a chore and more of a bonding experience? Check out our point on budgeting discussions over coffee. Trust me, mixing caffeine with spreadsheets can be surprisingly fun.
An often-overlooked but equally important key to financial bliss is clear financial communication. No one likes a surprise bill or unknown subscription fees cropping up out of the blue. Make it a habit to discuss finances openly every month—it’s like having a regular heart-to-heart, but about money. For more on fostering these open lines of communication, head to keeping the money talks sweet.
Equally significant is the concept of having personal spending money. Let’s face it; everyone loves a bit of financial freedom. You don’t want to argue over every single purchase. Set aside individual fun funds so you each get to indulge guilt-free. Discover strategies on this in our section on guilt-free personal budgets.
And lastly, make sure you sign up for financial planning. Because, in 2024, embracing the future means tackling today’s economic uncertainties with a balanced approach. Even if it sounds as exciting as watching paint dry, trust me, post-planning life feels like a new coat of fresh paint.
Ready to step in tune? We'll take you through 20 ways to better manage money as a couple that turns financial woes into a harmonious financial symphony.
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1. Set Solid Financial Rules
One of the easiest ways to manage money better is to set proper financial boundaries for you and your spouse, for basic everyday purchases. Have a clear understanding of those rules and re-evaluate them on a regular basis, to find out if they are still working for you and your family.
2. Team Finance
As a couple you need to realise that you are no longer a law unto yourself and that now you are part of a team; team finance. Make money and finance a regular part of your communication, and always know where you stand financially.
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3. Know What You Want
Have a clear understanding of what your financial goals are for yourself and as part of your relationship. If you want to put away some money and invest it, make that part of your financial goals that you will share with your partner.
4. Know What Your Spouse Wants
It is as important to know what your spouse’s financial goals are and where they want to go in life, as those plans obviously include you. If their goals and yours are totally different you are going to have a problem in working out vastly different futures and expectations. When you both have different views of your present and future money, you need to discuss managing joint finances.
5. Talk Often
One of the biggest mistakes couples make when trying to sort out money issues is not communication about finances at all because the subject always leads to tension. If you make money a regularly point of discussion, you will find that the subject is not that difficult to broach and becomes easier to discuss.
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6. Budget
A joint budget is a vitally important plan made for the household and relationship and put together by both of you. Putting financial goals and expectations down on paper will give both you and your spouse a good idea of where you are financially and will help you both prevent you from overspending.
7. The Emergency Fund
Another of the key ways to manage money better is knowing what your resources are when there’s an emergency. When times are good, nobody thinks about when times get tough, and to have an emergency fund, where you have surplus cash for unexpected situations, will help provide you and your spouse with a solid peace of mind. If one of your family members needs an emergency operation, or the car needs an expensive part, you won’t have to dig into your life savings or your monthly budget to cover the costs.
8. Retirement
Planning ahead for your retirement is something that should be addressed very early on in a marriage or relationship. Everyone wants to sit in the shade, but nobody bothers to talk about planting the trees. Better money management includes retirement planning and not just grocery budgets.
9. Debt
Debt is something that can really put serious strain on a relationship. If one or both parties have any amount of debt, it can cause ructions and tension between the happiest couples. Work out a plan to manage the debt and how you are going to pay it back.
10. Shared Responsibilities
Taking responsibility for money as a couple is a shared responsibility, and if one party is making bad financial decisions, the other party needs to approach their spouse in a loving and respectful way and find a way to overcome any difficulties.
11. Honesty is the Best Policy
It is so easy, for the sake of avoiding conflict, to lie about purchases to your spouse. But actually, honesty is a much better policy when it comes to managing joint money, as you are part of a financial team, and if you can’t trust your spouse or your partner when it comes to money, you have huge problems.
12. When Your Spouse Overspends
If you have a spouse that is an avid retail therapy enthusiast and you can’t necessarily afford to support their habit, you will need to approach this subject before it starts to have a negative effect on your joint finances. Manage money better by communicating, planning and following up regularly.
13. Financial Risks
As part of a financial team, if one party wants to take some financial risks, such as playing on the stock market, or investing in a get rich quick scheme, then the decision needs to be discussed together. Managing money better is not one party taking heavy financial risks on their own.
14. Joint Bank Accounts
These days, many couple may not have joint bank accounts, as both parties work full time and women like to keep some financial independence. One of the most sensible ways to manage money better as a couple is to have a joint account for household expenses, and reach a decision as to how much each of you contributes to it. Make your contributions like clockwork and if you can’t, discuss it. Don’t wait for a bill to arrive and there’s no money to pay it.
15. Big Purchases
There should be a rule when it comes to large and expensive purchases up to a certain amount. Couples should discuss what a large purchase means to them, and how they are going to deal with the financial implications. It is a good idea for couples to put a rule in place that prevents one spouse from splashing out without the other spouse’s knowledge.
16. Who Pays More?
When one party earns substantially more, it is not fair that both parties should contribute the same amount to the household. If one spouse cannot afford to contribute 50% of their monthly salary, and the other can do so without being left in the dark, the split needs to be fair, otherwise it leads to resentment and fighting.
17. Learn from Each Other
If one spouse has a better knowledge of grocery prices and the other has a better knowledge about the prices of car parts, you can both learn from each other and learn together about how to manage joint money better. If one of you has a strength in budgeting and the other not, then work together, learn from each other and you will become a formidable financial team.
18. 40/60
When it comes to relationships, we have all heard about it being a 50/50 partnership, but couples who have been married for a long time will tell you that it should be 40/60. Take 40 % and give 60 % all the time, in all aspects, every day in regards to everything, including money. How is that for a powerful concept?
19. Don’t Fight when You Are Angry
This is especially important when it comes to managing money better, because it can be such a sensitive issue. Anger can take the subject of money to an unprecedented level that can be hard to come back down from. Fight fair, and broach subjects with love and respect and count to 10 before you say something you can’t take back.
20. See a Financial Planner
A financial planner is like a relationship counsellor, except not for emotions but for money. Good money management will need expertise advice from time to time, and a financial planner can give you and your spouse the perspective you need.
Good financial planning is very important for couples who are planning a future together, and good money management really does take a lot of hard work. Consistent, honest and clear communication will help couples manage joint finances successfully. Do you have any more ways for couples to manage their money better?
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