One-third of couples report that money is a huge source of conflict in their relationship but, while fighting about money may be common, the source of the tension can be varied – making it difficult to find ways to resolve the conflict.
Here are the most common reasons why couples fight about money:
Different money experiences
We are all defined by our previous experiences with money, how we were raised, and what role money did or didn’t play in our upbringing. A couple’s differing experiences with money can create tension within the relationship, especially where those experiences were vastly different. A childhood marked by financial scarcity and indebtedness can cause a person to become overly frugal and intent on saving as much as possible. When partnered with someone who experienced a financially comfortable childhood, friction can arise.
What to do: Be open with your partner about your past experiences with money and to what extent they have impacted on your money fears, work ethic, attitude towards saving and/or debt, and financial goals. Seek to find common ground on which to start building your joint financial future. Finding a balance between being comfortable in the present while saving for your future is key.
Differing levels of financial education and literacy between partners can be a source of tension. It may be that one partner has a good understanding of how investments work, the dangers of debt, the power of compounding interest, the need for budgeting, and daily money management, while the other partner lacks basic financial literacy and/or shows little interest in learning about it.
What to do: The starting point is to agree that managing the household’s finances is a joint responsibility. Although one partner may have a greater inclination for finances, it doesn’t absolve the other partner from sharing the burden. Commit to working as a team and find a way to allocate responsibilities fairly between you. For instance, one partner may be responsible for the payment of accounts, while the other commits to checking the bank statements every month.
Financial infidelity can be just as devastating to a relationship as an affair, especially where there are dire consequences for your joint financial future. Hidden purchases, having undisclosed bank accounts, secretly borrowing money, lending money to family and friends on the sly, or incurring debt without a partner’s knowledge can be catastrophic to any relationship. Implicitly trusting your partner to work with you in building your future financial security is paramount.
What to do: There is a fine line between being financially transparent with your partner and having to account for every penny that you spend. To avoid this, agree on a spending limit above which you agree to discuss the purchase with your partner beforehand. At the outset of your relationship, decide on how you are going to deal with friends and family members who ask for loans, and then stick to the plan.
Previous financial commitments
Financial commitments to a previous spouse or children from a previous relationship can lead to resentment, bitterness and complicated financial tensions. Unreasonable maintenance demands from an ex-spouse, refusal by an ex-spouse to pay maintenance, or guilt-spending on children from a previous marriage can lead to emotional financial baggage being brought into your new relationship. Having financial commitments to a previous relationship can make it difficult for you and your new partner to move forward financially.
What to do: Managing the financial intricacies of blended families can be emotionally and financially challenging. If you are bringing financial baggage into your new relationship, the onus is on you to be open and honest about the extent of these commitments. Your new partner needs to appreciate your desire to honour those commitments while at the same time feel assured that you are intent on securing a financial future with her.
Outside interference in your financial affairs from in-laws and friends can hinder teamwork and break down trust. Where one partner’s financial decisions are being influenced by interfering family or friends, the other partner is likely to feel angry and betrayed. Likewise, being excluded from major financial decisions, such as purchasing a property or booking an overseas trip, can make a partner feel less than an equal in the relationship.
What to do: Commit to keeping your joint financial affairs private unless otherwise agreed to by both of you. Disclosing personal financial information to other people is often interpreted as an open invitation to become involved in your affairs.
Being a stay-at-home parent can be tough, especially if you’ve chosen to give up your career and earnings to raise children. Having one spouse working while the other manages the home and raises the children can take enormous adjustment, especially when it comes to finances. Not generating your income and becoming financially dependent on the working spouse can shift the balance of power and lead to resentment on both sides. While the stay-at-home spouse may feel unfulfilled and resentful at being reliant on her spouse for money, the working spouse may feel overburdened, tired and burnt out by work stresses.
What to do: Think very carefully before giving up a career to become a stay-at-home parent. Consider all other options including flexible work hours, reduced hours or working from home, and give thought to other childcare options. Will you be comfortable receiving a monthly ‘allowance’ from your spouse? How will you feel asking for more money if you run out? Will you have money to spend on small luxuries for yourself? What will happen if your relationship fails? How will five years out of your industry affect your future employability?
Joint or separate money management
Choosing whether to manage your money jointly or separately can cause friction, and there is no right or wrong way to go about it. Where one spouse chooses to manage his money separately, the other spouse may feel suspicious and mistrustful. On the other hand, where one partner insists on joint money management, the other partner may feel like she is being monitored and controlled.
What to do: Ideally, this decision should be made before getting married or committing to a long-term relationship. Trust and communication play an important part in establishing the grounds for managing the household finances, so be sure to lay your expectations and fears bare at the outset. Whichever method you choose for the technical aspects of your relationship’s money management, it’s essential that both partners are happy with the approach.
No common set of goals
Not having a common set of goals can leave a couple feeling directionless and isolated from each other. In the absence of common goals, a couple may end up working against each other and jeopardising their financial future. Every team needs a set of goals to work towards to stay united and motivated.
What to do: Developing a shared set of goals is one of the most important steps to take as a couple as this will provide you with a touchstone against which all future financial decisions can be made. Be sure to listen carefully to each other’s dreams and goals, and then find a set of goals that are shared and valued by both of you. Empathy and compromise are key to this process.
Some people have an outright aversion to debt, while others are comfortable borrowing money and don’t lose much sleep at the thought of owing large amounts of money. Where one partner comes into the relationship with debt or incurs debt during the relationship, it is only natural for the other partner to feel somewhat aggrieved. Debt, especially credit card and retail debt, is burdensome and can prevent you from building future financial security, which in turn can compromise the joint goals you have agreed upon.
What to do: Revisit your goals with your spouse and voice your concerns about how his debt is compromising your joint financial future. Put a debt reduction plan in place and make a joint commitment to eliminate the debt as quickly as possible. Celebrate your small victories together.
Power struggles can come into play where a couple earns disparate incomes, especially where one spouse tries to assume financial control because he/she earns more money. The higher-earning spouse may feel entitled to spend more money or have a greater say when it comes to financial decision-making.
What to do: Talk to your partner about financial teamwork. If you’re both working towards the same financial goals, then it really shouldn’t matter who earns what. What matters more is that you both stick to the game plan and share the responsibility of managing the finances.
Different value systems and parenting styles can cause tensions in your relationship, especially when it comes to children and money. Co-parenting means having to find common ground on issues such as pocket money, whether your children should find holiday jobs, private versus government schooling, how to teach your children financial responsibility, and how to let them deal with the consequences of their decisions.
What to do: Have discussions with your spouse about how you each envisage raising your children, what values you would like to instil, and how you would like to teach them financial responsibility. Finding mutual ground with your partner will help you to parent your children as a united force, as opposed to letting your children play one spouse off against the other.