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Making Smart Money Choices as a Couple

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Fights over finances can stem from a number of causes, ranging from disagreements over goals and priorities to feelings of anger and resentment over who earns more. Sometimes it can be a challenge to make smart money choices together.

Here’s the good news: arguing over money doesn’t need to be the norm in your relationship. You can reduce anxiety, fear, and other negative emotions over your household finances by taking action to become a financially savvy couple who feels confident and excited about the future.

And most importantly, you can feel financially in tune with your partner so that money fights don’t happen in your house. So, what money choices can you start making together? And how do you get on the same page?

Talk It Out

You need to be communicating about your finances from the early days of your relationship. If you’re already a few years in – better late than never! The first step to becoming a financially savvy couple: communicate! Remember, you’re a team and you can work together to achieve your goals and get what you want. But you can’t do this successfully if you don’t speak up, share your ideas, and understand what your partner thinks.

Always be honest, remain open, and don’t bottle up negative feelings.

Set up a framework to ensure each person’s thoughts and ideas are heard on a regular basis. Put a monthly “money date” on your calendar. Take 30 minutes to an hour once a month to sit down with your partner and go over all of your finances.

Look at your budget, pull up your bank and credit card accounts, examine your bills, and look at your retirement fund and investments. Evaluate what happened with your money last month, and make a plan to correct any mistakes or reign in any runaway spending for the upcoming month.

Then, brainstorm ways you can continue to improve your current actions with your finances. Save some time at the end to discuss goals, hopes, and dreams and ways you can continue to feel motivated and inspired to work for those things.

When you sit down for regular check-in’s, or “money dates” to talk about your finances as a couple, it can be helpful to ask each other questions and listen to your answers. A few of the questions you can be asking one another are:

  • Are we combining our bank accounts?
  • What’s our monthly budget?
  • Are we staying on track to meet our financial goals?
  • What are our financial goals?
  • Who is in charge of the day-to-day finances?
  • Are you happy with how we’ve been handling our money?

Having these conversations on a regularly scheduled basis is key to finding your financial footing as a couple.

Set Goals as a Team

If one of you is set on paying down your debt, and the other is focused on fully funding your retirement savings, you may have to pick and choose which goals get prioritized. In an ideal world, we’d all be on the same page about our financial priorities, but that doesn’t always happen. Checking in regularly to better understand what your goals are, and if priorities have shifted, is incredibly important.

Keep Records

Couples who are financially savvy understand the importance of staying organized. This can help with everything from small, everyday situations to your big annual trip to your accountant’s office to file taxes.

When you keep records and document all aspects of your finances, you create a detailed source of information when you have questions or aren’t sure about the right decision to make. You can reference your files to solve problems, answer questions, and realize what money moves make the most sense for you in the present.

And of course, keeping records of your cash flow — in other words, keeping a budget — means you stay on track for the future, too.

Track Your Progress

Don’t let your money run wild without supervision. Financially savvy couples track income and spending so they can evaluate whether or not they’re putting their available dollars to the best use.

Another smart money move once you’ve started tracking your finances: measure your progress! Each month, measure how much your savings has grown. Keep tabs on your home value. See if your income is growing or staying stable.

You can also put all these metrics together to measure your net worth. This is a good indication of your overall financial health.

When you track and measure, you understand what’s going on and you can see your progress over time — and that can be a huge motivating factor to help you keep going.

Focus on Debt

Debt is a huge point of contention amongst couples, so focusing on a gameplan to knock it out together can take a lot of financial pressure off of your relationship. If you have multiple debts, they may feel completely overwhelming. Before you panic, know that you and your partner can do this! And there are a few strategies you can use to help make it easier. The first strategy is known as the avalanche method.

This method directs you to prioritize your debts by their interest rates. You work to pay off the debt with the highest interest rate first (while still paying the minimums on your other debts). Mathematically, this makes the most sense. The interest rates on loans and credit cards cost you more the longer you hold on to them, and of course higher rates cost you the most. But some people find it really intimidating to try and tackle their biggest, baddest debt as the first step toward debt freedom.

Related: How to Plan and Save for a Home Down Payment

Related: How to Set Income Goals for Your Growing Business

If you prefer to start small, you can try a different strategy that comes at the problem from the other end. This strategy, known as the snowball method, involves prioritizing debts in order of the amount of money you owe. You start with the debt with the smallest balance and work your way up, regardless of interest rate.

This is helpful for those that feel discouraged by the amount of debt they’re in, as it should give them a quick win. However, it may not be the most financially efficient way to deal with all of your debt. You may end up paying more in the long run if you let high interest rate debts sit on the back burner while repaying other balances. What matters is that you’re making progress with your debt and moving in the right direction. It’s best to just start. If there’s one debt really weighing on you emotionally, tackle that first!

Discuss Your Investing Strategy

If you don’t know anything about finances or investing, recognize that you need to increase your financial literacy. Ask for help from a professional, start reading up on personal finance books, and look into educational courses on money and investments that you can take together. You don’t need to be financial experts before you start investing, but you do need to understand the fundamentals so you aren’t throwing your money around blindly. Start by reading this post on How to Get Started with Investing and then following up with Basic Investing Terms You Should Know part one and part two.

Keep Learning Together

The couple that learns about money together stays together! Sure, it sounds a little silly, but communicating and constantly adding to your financial knowledge as a couple goes a long way. Disagreements and misunderstandings about money lead to serious marital stress.

Remember that you and your new spouse are a team and you’re working together towards what you want to achieve in life. It’s up to you to create an ideal, secure retirement for the two of you. No one else is going to take care of your financial needs in the future, so it’s important that you plan ahead and start saving now.

If you’re feeling like your spouse isn’t on board with the whole making smart money moves concept, start small and work into conversations and steps in increments that will help you to make measurable progress along the way.

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