Talking about finances with your partner can be challenging. Money can be a touchy subject for many people, and disagreements over spending habits are a leading cause of divorce for married couples in the U.S.
In fact, a study conducted by the University of Tennessee found that even happy couples disagreed on certain money-related matters. But there’s hope: 87% of married couples who consider their marriage “great” regularly collaborate with their spouse to work toward long-term financial goals, and 94% of people with healthy marriages say they talk about their money dreams together.
How to Talk About Money With Your Partner
Approaching financial talks with respect, understanding, and empathy can help strengthen your relationship and encourage positive habits. Unsure of how to talk about money with your partner? The following tips can help:
1. Set the tone for collaboration and transparency.
Honest dialogue is the foundation of any strong relationship, and financial matters are no different. Start by establishing an environment of transparency and non-judgment. Let your partner know you’d like to have a discussion about money, and set aside a specific time to meet. Pick a relaxing setting that’s free of distractions, and make sure to express your desire to work together as a team.
When learning how to talk about finances with your partner, remember to avoid casting any blame or making accusations. Don’t assume that their intentions are negative, and encourage them to share their financial goals and concerns. This is also a great time to examine your own attitude toward money. We learn from our surroundings, and it’s easy to pick up negative spending habits from our parents or siblings. During this process, it can be helpful to ask yourself and your partner the following questions:
- Did you grow up in a household where finance-related discussions were avoided?
- Did your parents argue about money on a regular basis? Were they always in debt?
- Were you taught that making money was somehow wrong or immoral?
- Did your family prioritize saving and investing over spending?
- Did your parents establish and follow a budget? Did they set financial goals and work together to achieve them? Did they involve their children in family discussions about money?
Discussing your money values will encourage your partner to do the same. By identifying any areas of disagreement, you can start working to align your goals.
Remember that spending habits are more than just numbers. Your goal is to understand your partner’s perspective. Taking the time to understand one another’s money mindset will offer insight into your spending habits and can foster a strong sense of security.
2. Crunch the numbers.
Next, it’s time to crunch the numbers. Write down one to another’s income, current expenses, credit card debt, student loans, and investments. What’s your current financial situation as a couple? Where would you like to be?
While sharing the details of your current financial situation may feel uncomfortable or even embarrassing, avoid being dishonest or vague. Be as open as possible about all existing debt, outstanding loans, or other financial struggles you may be facing. And although 54% of people feel that debt is a valid reason to divorce someone, showing your partner that you’ve created a well-defined strategy pay off lingering debt shows responsibility and maturity.
Again, it’s important to avoid lying to your partner about money. They’re likely to discover the truth sooner or later, and the lack of transparency may tarnish the relationship.
3. Set financial goals as a couple.
Financial conversations become more effective when you establish financial goalposts that you can both work toward. Approach these discussions with a collaborative mindset, and write down any short-term and long-term financial objectives you hope to achieve as a couple. These can include:
- Purchasing a home.
- Eliminating or reducing your remaining student loan debt.
- Eliminating or reducing credit card debt.
- Starting a family together.
- Investing in rental property or properties.
- Building your family’s emergency fund.
- Establishing a college tuition fund for your children.
- Saving for retirement, contributing a higher percentage of your salary to a Roth IRA or 401(k).
- Buying a new or pre-owned vehicle.
Once you’ve written down your aspirations, break down each goal into smaller, simpler milestones. Establish clearly defined roles and responsibilities that build upon one another’s strengths. Make sure that both partners are actively involved in the decision-making process. During this phase, it can be helpful to avoid setting unclear goals that can feel unreachable or overwhelming. Paying off your student loans within a year may seem like a worthwhile endeavor, but doing so may not be possible with your current income and expenses. That’s okay! Setting realistic, achievable goals will help you both stay motivated and avoid discouragement.
Resource: What to Look for in a Financial Advisor: 6 Essential Qualities
Now, in some relationships, maintaining separate finances is the preferred approach, with each partner handling their money independently. While this arrangement can work well for many couples, it’s crucial to make sure that communication remains open and both partners are aligned on shared expenses, savings goals, and long-term financial plans.
Discuss how you’ll handle joint expenses and establish clear responsibilities. Transparency about individual financial situations builds trust and fosters shared responsibility. Remember, every couple’s financial setup is unique, and the key is to find what works best for both of you while supporting your shared goals.
4. Develop a realistic budget and track your expenses together.
A budget is a powerful tool! Make sure to involve your partner in the budgeting process and to review and make adjustments periodically.
- Put it in writing. Write down your combined income from full-time or part-time jobs, side gigs, or investments. Next, list all current expenses, such as your utility bills, cost of groceries, credit card payments, student loan payments, vehicle maintenance costs, money spent on gas, etc. It can be helpful to use a budgeting app, spreadsheet, or notebook to track all expenditures.
- Separate fixed and variable expenses. Fixed expenses include your mortgage payment, car payment, student loan payments, and anything that remains the same each month. Variable expenses include costs that fluctuate each month, such as money spent on groceries or your electric bill.
- Include your short-term and long-term financial goals, then rank them in order of importance. This ensures that you’re focusing on what matters most to you as a couple.
- Prioritize saving. Set aside a standard percentage of your income each month for retirement, emergencies, or long-term goals. Set up an automatic withdrawal to avoid any temptation to spend.
- Establish limits. Set realistic spending limits based on income and expenses. Identify any areas where you may need to reduce spending to meet your financial goals.
- Stay flexible. Take some time each month to review your budget together. Are you consistently working toward your short-term and long-term goals? Are you saving enough money each month? Do you need to make adjustments to account for unexpected costs?
Achieve your financial goals with the right advisor.
This blog has covered tips on how to talk about money with your partner. From setting a realistic budget to establishing financial goals, these strategies can help couples build a stronger financial foundation. But crunching numbers and staying flexible will only get you so far. Building positive financial habits together takes hard work, patience, and the right guidance.
The perfect strategy will depend on your current financial situation, your overall goals, your combined income, and more. But one of the best ways to improve the chance of success is to partner with a CERTIFIED FINANCIAL PLANNER® professional.
Click here to get a free 15-minute introductory session with one of our CERTIFIED FINANCIAL PLANNER® professionals. We’ll discuss your current financial situation, your goals, and how we can help you get there.