Combining finances is a daunting task when you first get married, even more so when you and your partner have very different incomes.
Anyone who has ever been in a serious relationship will tell you that working through money issues is far more complicated than simply deciding who pays the cable bill – it takes a willingness to trust, communicate, research and make financial decisions as a couple.
Here are four things to consider when blending finances:
1. Figure out the feelings behind the numbers
When my boyfriend (now husband) and I moved in together, I was worried.
He earned almost twice what I did, so I had a lot of fear and insecurity about my ability to contribute.
Somewhere along the way I had gotten the idea that the amount of money I contributed to the relationship equated to how much say I had in financial matters.
This left me feeling vulnerable and a little out of control. Whenever the topic of money came up my heart would start to race, my head would get cloudy and I found myself getting defensive over things that weren’t even really an issue (No! I want Chinese food tonight!)
These types of beliefs and ideas can shape the way you think and communicate about money, so it’s important to sit down and devote time to identifying these potential pitfalls.
One of the best ways to identify your own soft spots is to pay attention to your own self talk. For example in my relationship struggle, I knew I was overreacting to things but I didn’t know why.
So to get to the bottom of this I decided to start journaling every day to track how I was feeling; what kind of self-talk I was giving myself and what was happening to me when I became defensive.
I didn’t have to journal for very long before I identified my belief that my share of the household income equated my share of say in financial matters. Figuring out this trigger helped me to start shifting my thinking about money in my relationship.
2. Communicate, communicate, communicate
Talking honestly with your partner can be tough for even the most open of couples.
There are lots of ideas and expectations that come with money (I should be in the same financial position as my friends etc.) and it can be hard to break down these barriers and talk honestly about saving, spending and everything else in between.
Communicating about money is about more than how to split the bill on date night, it’s about your priorities, your goals and your future.
Do you want to start a family right away? Does your partner want to go to graduate school? How do you envision your retirement?
It’s important to take time to work through everything. But do it over several sessions so you’re not overwhelmed.
While it’s important to talk about the big, complicated stuff you can give yourself a break and intersperse it with conversations about things you know you both agree on.
For instance, are you both socially conscious? Do you both believe it’s important to give back and donate to a particular cause?
Awesome! There’s an easy victory for you both which can pave the way for more challenging conversations.
3. Don’t go it alone: Research and reach out
I sometimes make the mistake of thinking I have to solve every problem myself. That’s what I’m going through with my husband is our problem alone and that we need to find our own solutions.
While it is our responsibility to find answers, we don’t have to do it in a vacuum.
There are several great blogs, books and other resources out there to help you get started. As far as books go, I really like Smart Couples Finish Rich by David Bach. He’s smart, he’s readable and he talks about the psychology behind the money.
Another option is to talk to a financial advisor that you trust. If you don’t know anybody yourself ask someone you trust for a recommendation. If you prefer the personal touch, talk with the friends and family you admire and trust.
If your parents have been happily married for thirty years and you’re comfortable with discussing your money matters with them, you might find that they also have some valuable insights into what goes into a good financial marriage.
4. Making the decisions
Okay you’ve read your books, talked to your financial advisor and gathered some great advice – what now?
The important thing to remember is that there is no one-size-fits-all solution. Your financial and insurance needs are a living thing and will evolve with your relationship.
It’s absolutely okay if you need to fix it, change it or scrap it later.
My husband and I use a percentage-based system. He brings in 60 percent of our household income while I bring in 40 percent – so that’s how we divide the major bills.
We also have a system for working out individual expenses and a “date fund” for our nights out together.
This is what works for us. And over time we’ll tweak our budget and work through problems as they arise.
The most important parts of this equation are you and your partner. Don’t let the well-meaning advice, the personal finance books, and all the facts and figures distract you from the fact that everything comes down to one simple number – the two of you.
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