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5 Reasons Why BOTH Partners Need to Meet With the Family Financial Advisor

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5 Reasons Why BOTH Partners Need to Meet With the Family Financial Advisor

As you know, tension over money is the leading cause of stress in relationships.  When I meet with my clients to discuss financial planning for their families, I consistently find that the purpose of the meeting is undermined when there is only one spouse present. Here are five drawbacks of having one, not both, partners present at a meeting with the family financial advisor.

1. Conflicts may exist that you do not even realize. 

If you think you and your spouse are on the same page about money, try sitting down with a financial advisor.  You may agree on the big picture (we want to own a house, we want to send our kids to college, we want to retire) but the devil is always in the details.  Forming a plan about **how** to achieve these big goals (even if you agree on what the big goals are) will require a detailed plan with specific action items affecting both your lives.  Assuming that your spouse will be on board with whatever you agree to do with your financial advisor (example, buying a new life insurance policy with a higher premium, cutting back on certain daily living expenses) can cause resentment when plans become reality.

2. Mistakes

Not having both partners at the meeting can result in misunderstandings, and even some pretty costly mistakes. I’ll give you an example.  Almost every time I meet with the male partner, if he is the breadwinner his attitude towards life insurance commonly is, “I need at least a million of insurance on me. My wife doesn’t work so there’s no (or little) need for any on her.”  Well, if the wife were there I am sure she would not have neglected to mention the $40k in daycare expenses he would have to pay without her, and that’s not to mention cooking, cleaning, driving the kids to doctor’s visits, etc.  These “services”, if they had to be bought, would probably start at $10-15/hour if you want the same quality that she provides. It adds up. This can be a costly mistake that threatens the family’s lifestyle; if something were to happen to the partner absent from the meeting, they wouldn’t have enough resources to sustain their lifestyle, due to poor planning.

3. Stalling.

Over and over again, I meet with one spouse who says, “Yes!  I totally agree that we should invest our money according to your plan, and my spouse will be totally onboard with whatever I say.”  Well, come time to write the check and the purse strings get yanked by the partner who wasn’t there.  The absent partner typically resents the one who makes the decision just for doing so without him or her; even if they don’t realize it they feel left out.  Or, they may not understand the value of taking this action because they weren’t there to hear it directly from the financial advisor. This can stall or even destroy progress.

4. Fingerpointing. 

Let’s say that you meet with a financial advisor and the two of you, without your partner present, decide to go forward with a certain investment in your kid’s 529 plan.  The next day the market crashes and you end up having to explain to your spouse why you now you can only afford half the years of college that you could have if you had left the money in a checking account.  Think you’ll be sleeping on the couch tonight?

5. What if the big bus comes?

The wife says, “My husband is the one who handles money. I don’t have to be involved in the meeting.”  Well, if the big bus comes unexpectedly and he passes, she’s left without a clue about anything more than how much she has in her checking account.  Completely powerless and now given the job of family CFO without even a clue what the job description is.  You never know when you’ll be in a position where you have to assume responsibility for the household.  Even if you aren’t the primary decision maker, awareness of what resources you have is your only defense if circumstances dictate that, by random chance, you must be the one in control.

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