Does money create a strain in your marriage? Are you unsure how to handle finances in a marriage? If so, read on to learn 5 easy tips that you can apply to your financial life.
TIP #1: HAVE JUST ONE CHECKING ACCOUNT.
When you were single, life was simple, and you could essentially do whatever you wanted, whenever you wanted. Now that you’re married, life is slightly more complicated (okay, a lot more complicated if you have kids).
So, one of the things you can do to simplify your life is to maintain just one checking account. If you want to divvy up money between different goals (more on this in a minute) then set up multiple savings accounts. But one checking account is all you really need.
I’m not opposed to a couple having multiple checking accounts if handled in the right way. But often times the motive is, “my money is my money and your money is your money”. This is not healthy and one spouse may end up paying more of the bills than the other spouse.
TIP #2: CREATE ALLOWANCES FOR EACH OTHER.
One of the things that my wife and I implemented was paying an allowance to each other on a monthly basis. We have “x” amount of dollars go to a separate savings account each month for each of us. This provides us with the freedom to spend that portion of money however we want. Freedom is great in a marriage; you need to have your outlets.
In fact, don’t stop there. Feel free to set up multiple savings accounts for all of your goals (i.e. house repair fund, vacation fund, car fund, etc.).
TIP #3: BOTH SPOUSES NEED TO BE INVOLVED (to some degree).
At our company, we have run across a situation a number of times that could cause problems in the future. Often times we find that one spouse typically handles the finances in a marriage. In many cases we have found this to be the husband. The problem with this is that if something should happen to the spouse who handles the finances, then the other spouse will be left in the dark.
To remedy this situation, take turns managing the finances and paying the bills. Alternate every other month so that it is fresh in each of your minds.
TIP #4: UNDERSTAND WHETHER YOU ARE A SPENDER OR A SAVER.
As a married couple, have a conversation about money and understand the type of person you are. As you’ve heard, opposites attract. While that is good, it can also lead to some deep-seeded problems if one spouse is a saver and one is a spender.
In actuality it’s not good to be an extreme saver or an extreme spender. You must strike a balance between the two to have a healthy marriage.
Setting expectations is vitally important, so do yourself the favor and sit down and discuss what type of person you are and whether any old habits need to be changed. And try to understand the other’s point of view. Remember, we all carry certain baggage to a relationship – much of which was likely ingrained from our upbringing.
TIP #5: CONSOLIDATE YOUR INVESTMENT ACCOUNTS.
The most extreme example that we’ve had at our office is a client who had 17 different investment accounts. Our client’s husband had died and she was left to manage all the accounts by herself. We were able to simplify her life by consolidating these accounts into 2 accounts. Afterward, she was only receiving 2 statements per month as opposed to 17.
If you have multiple 401ks from previous employers or multiple IRA accounts, consider consolidating them into as few accounts as possible.
Keep in mind that money is never the problem; only how we view it. Open up a dialogue, lay some ground rules, and take a balanced approach. If you do, you may find that your arguments around money decrease.
We would love to hear any successful finance tips that you have used in your marriage. Please share them below. Thanks for tuning in.
Brad E.S. Tinnon
CERTIFIED FINANCIAL PLANNER™