Do you and your partner fight over money all the time?
While money is something that everyone needs and wants, did you know that money-related issues are the number one cause of stress in relationships?
Talking about the issues can help, but what helps, even more, is learning how to manage money as a couple.
Learning how to manage money together can alleviate many arguments, problems, and stress in your relationship and life.
If you’re ready to learn how to manage your money, continue reading this guide that explains the most helpful money-management tips for couples.
Create a Pact of Honesty
Are any of the fights you have related to secret debts or purchases? If so, you’re not alone. A lot of couples struggle to be honest with money, and experts call this “financial infidelity.”
For some reason, many people find it difficult to talk about money. They find it even harder to admit they owe money on debts that their spouses do not know about.
Hiding purchases and debts from your spouse will always lead to arguments and issues. Your spouse will question why you weren’t honest and may wonder if you’re hiding other things, too.
Avoiding financial infidelity is essential if you want to improve your financial state and stop fighting over money issues. Therefore, one thing you and your spouse should do is create a pact of honesty.
A pact of honesty means that you both agree to be transparent about your spending habits and debts. You agree not to hide money-related issues from each other, and you decide to have open conversations about your finances regularly.
Develop a Budget
Once you agree to be honest with each other about every financial detail, you should start working on a budget.
As you do this, you must each present every debt you owe, regardless of whether the other person knows about it. Remember, you have to be honest, and you cannot create an effective budget if you leave things out.
An effective budget should list your total monthly income and your regular monthly expenses. Your regular monthly expenses consist of every bill you pay each month, such as your mortgage, car payments, and utilities.
Next, you can list the extra expenses you have monthly, such as groceries, entertainment, and gas.
When you add up all your expenses, you can subtract them from your income. The amount left is the money you can use at your discretion.
If you both like having the freedom to spend money as you wish, divide this money between both spouses. Each would then have some cash to use for discretionary spending.
Spending some time researching budgets and tips for creating them can be helpful as you start working on yours.
Have Three Bank Accounts
Using three bank accounts is another excellent idea for managing money in a relationship. With three accounts, you can each have your own account, and you can have one mutual account.
You can place all your paychecks into the mutual account, and you can transfer the discretionary spending money into each person’s account weekly, biweekly, or monthly. You can then pay all the bills from the joint account.
If you decide to use this tip, make sure that you tie all three accounts together. You should both have access to all the accounts you have. Allowing each other to see every account keeps transparency with your finances.
With this option, you should have one spouse manage the joint account. This person will be responsible for paying the bills on time and reconciling the account. The other person should check in on the account periodically, though.
Determine Your Goals
When talking about money and relationships, you need to discuss your goals. Now, it is not uncommon for spouses to have very different views on spending. In many relationships, one person is a saver, and the other is a spender.
If your relationship has a saver and spender, you both probably know which is which without even talking about it.
It’s normal to have these differences in a relationship, and it’s often a good thing. It helps balance things out, and it can even improve the financial aspects of the relationship.
Creating goals might be challenging if you have differences, but it is also vital. As you talk about your goals, you can each discuss what you would like to see for the future.
After discussing these things, write a list of goals. You can divide the goals into two categories if you wish:
- Short-term goals – These are goals that you hope to meet within one year or less.
- Long-term goals – These are goals that you hope to reach within a few years or more.
Having goals gives you a plan and something to look forward to with your finances.
Agree on Major Purchases Beforehand
Finally, you should agree that you will not make major purchases without talking about them first.
For example, imagine if you were driving around and saw a car at a dealership that you want. Instead of going to the dealer and trading the car in without thinking about it, you would first talk to your spouse about it.
Making substantial purchases without the other spouse’s consent will lead to problems in your relationship. Making this agreement and sticking with it can help resolve issues before they happen.
How to Manage Money: Learn More
Talking about your financial situation is an excellent way to begin learning how to manage money together.
If you find out that your finances could use some extra cash to pay off debts, contact us to claim your cash.
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