By Marlis Jansen with Lily Boyar
Imagine watching a movie and seeing a depiction of a Hollywood couple, dining by candlelight, and “going over the books.” This certainly isn’t your typical rom-com scenario. Discussing spending, debt, or saving isn’t what most of us picture for romantic date night conversation. However, while talking about money might not seem sexy, it is necessary for building healthy, lasting relationships.
Money is one of those taboo topics we’ve been taught to avoid. In fact, 44% of Americans believe it is the hardest subject to talk about, above sex, religion, and death (Coca, 2019). And many American couples feel their financial situation is directly linked to their self-esteem and social status, making it especially sensitive to discuss.
However, when we shy away from discussing our finances, we unknowingly hide an important side of our identity. Our ideas about money reveal deeply held beliefs and values. Our money behaviors can reveal insecurities and lack of knowledge. Avoiding the subject altogether can increase anxiety in a partnership because overall well-being in modern society is tied to financial stability. When partners in a couple don’t communicate well or at all about their finances, there is an increased risk that something will get in the way of a stable happy life together.
Many studies have shown that poor financial communication often has devastating results for couples. Conflict surrounding the topic is one of the greatest predictors of divorce. 1 in 5 American couples identify money as their greatest relationship challenge (Fidelity Investments, 2021). And in one study, 24% of couples reported feeling frustrated about their partner’s financial habits, but they tend to keep it to themselves in an effort to avoid an argument (Fidelity Investments, 2021).
Learning to discuss money in a meaningful way and to manage it collaboratively are essential skills for healthy partnerships. Even couples who keep their finances separate must make some decisions together. Charlotte Zeamera and Alisa Estey write in Journal of Financial Counseling and Planning, “The health of a domestic partnership is intricately involved with the way that finances are handled within that partnership” (p. 53). And this requires talking. In fact, couples who make decisions together about their resources report feeling better about their overall communication, and 84% feel more trusting in their partner’s financial abilities than couples who make financial choices separately. Successful collaboration around wealth can bring couples closer together.
Couples Often Have Divergent Values
In dating and relationships, we are constantly having money conversations, from how to split the bill to where to go on vacation. And from a young age, we each internalize expectations, beliefs, and opinions that influence our attitudes, preferences, and behaviors. The truth is, there are no right answers. How we feel about money is individual and personal.
Take the example of Debbie. She met a man in her late 20’s through mutual friends at a birthday party. As they got to know each other, she learned he was planning to open a restaurant. They shared a love of food and wine, and he enjoyed taking Debbie to decadent dinner dates around the city as “research” for his future menu. When the check would come to the table, Debbie would offer to split the bill but he insisted on treating her. It wasn’t until months later that Debbie learned he was carrying a significant balance on his credit card. She was shocked and felt deceived. Growing up, her father always instilled the importance of budgeting and avoiding credit card debt. Debbie felt she unknowingly participated in irresponsible behavior, and months later the couple stopped seeing each other.
It is common for couples to have divergent values regarding wealth. In fact, it is typical and expected for two people in a partnership to have differing beliefs and backgrounds. Factors such as gender, race, class, family background, and levels of financial literacy are all influential. With investing, for example, female-identified investors tend to prioritize using their resources to fund specific life goals (Fidelity Investments, 2021). They are more likely to cite retirement, future health costs, or their commitment to stewardship as their motivator for building wealth. Whereas male-identified investors are more likely to evaluate their investments based on “pure performance” (Zakrzewski et al, 2021). Female-identified investors also tend to be more risk averse as compared to male-identified investors. Women are more concerned about using their finances in a way that is consistent with their values and supporting causes that are meaningful to them (Zakrzewski et al, 2021).
Of course, it is ill advised to generalize attitudes about money based on identity factors alone, but it is important to understand the societal influences and cultural narratives surrounding each individual, and how they might impact a relationship. Differences are not a recipe for disaster. They are an invitation for partners to listen, share and get to know each other more deeply.
Intentionally embracing the practice of regular conversations about money and what it means are important skills that all couples need in order to thrive. But it can feel intimidating if we don’t know where to begin. We invite you to sit down with your partner and try some of the following activities, each intended to help reduce fear and anxiety surrounding money, encourage you to create your individual and collective financial identities, and build your capacity for collaborative planning. These suggestions are encouraged for all couples, regardless of whether or not finances are shared.
Square Up with Yourself
- Before we can talk openly with a partner about wealth, we must reflect on our own expectations of money in a relationship (Debbie). Consider how you like to spend money. What do you like to spend it on? What feels excessive? If you’re dating, ask yourself how much money plays a role in choosing someone. And how might your age or life stage impact these feelings? When we can honestly reflect on our own expectations related to money, we can have deeper, more meaningful conversations with our partner (D.A, 2022).
- What does it mean to add value in a relationship? Money can create perceived power imbalances in a partnership and couples often struggle to find a sense of equity (Mikeska, 2022). This is especially true when one individual works outside the home or if someone enters the relationship with more assets than the other. Michele Mikenska, Clinical Psychology PsyD at The Wright Institute conducted a study on couples with female inheritors and found that those who were able to fully accept and appreciate their partner’s contributions (both financially and otherwise) were able to adopt a new perspective that resulted in less conflict and more resiliency (p 48).
Get To Know Each Other’s Money Values
- Set a “money date.” Choose a salient financial topic to discuss, whether it’s a planned date night, an anticipated large expenditure, paying off debt, or more generally discussing differences around your attitudes on the subject. Then reflect on what you learned about each other.
- Share what emotions come up for you during your date. What is it like to talk about a particular expenditure or decision with your partner? What is it like to listen to your partner’s point of view? For seasoned couples, it’s never too late to discuss current patterns related to money and ways to change course. Taking the time to understand each other’s feelings about money and articulating your own can promote honesty and support future decision making.
Be Proactive about Debt & Spending
- Talk about any financial debt you or your partner are bringing into the relationship as well as any debt you take on during a relationship. Even if you choose to maintain separate finances (which is a very respectable decision for any couple to make), debt still impacts the partnership. It weighs us down psychologically and can limit our financial freedom. Even though it is very common to have college debt, for example, it is still important to share this with your partner as early as possible. This allows couples to practice being open and explicit with each other, which fosters healthy communication.
- Create a budget that acknowledges the debt each one of you is carrying. Budgeting doesn’t work for everyone. Sometimes, it can be easier to “rebrand” a budget as a “spending plan” (the words “spending plan” are more positive and aspirational, which can make a difference). With or without a spending plan, it is important to track and revisit spending on a regular basis so that you know where your resources are going and can make adjustments if needed. Couples that keep separate finances will need to do this individually as well as collaboratively for any expenses that they share.
- Make a rainy day fund. It is difficult for many couples to save for the future, and we tend to prioritize the fun stuff. But having money set aside for unexpected circumstances like car repairs, medical costs, and other unpredictable life events can reduce stress and give couples a sense of security.
- Don’t forget to create a “fun fund.” Relationships are not just about business! Consider putting aside money for fun things you want to do together. And, also, don’t forget to brainstorm non-spending activities (i.e. hiking, picnics, biking, free concerts, going to the beach, etc).
Invest as a Couple
- Investing offers an opportunity to collaborate, and build wealth. And it is an important conversation for any committed couple to have. Even with limited resources, consider investing a small amount. If you have a 401K, you are already an investor!
- Meet together with your investment advisor at least once a year. If you don’t have intermingled finances, share your separate investment strategy and results with your partner.
- Choose any particular aspect of your investing (whether it is your investment manager or a particular investment in your portfolio) and share your reflections with your partner. Why did you choose this manager or investment? How might it reflect your attitudes about money?
- Learn your respective risk tolerances. Relationships involve making difficult decisions. Having an understanding of each other specifically in the area of financial risk can help you transform the way you communicate. Here is a risk tolerance questionnaire to try at home.
We love follow up comments and questions. Was this helpful? We are curious about your experiences with these activities. And remember, even if you don’t want to share with us, it can be helpful to reflect on your experiences for yourself.
- D.A., personal communication, August 16, 2022.
- Coca, M. (2019, October 9). How to overcome the fear of talking about money. NEWS BBVA. Retrieved September 2, 2022, from https://www.bbva.com/en/how-to-overcome-the-fear-of-talking-about-money/
- Fidelity Investments. (n.d.). 2021 Couples & Money Study — Fidelity Investments. Retrieved September 6, 2022, from https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/about-fidelity/Fidelity-Couples-and-Money-Fact-Sheet-2021.pdf
- Investment risk tolerance assessment. Personal Financial Planning. (n.d.). Retrieved September 5, 2022, from https://pfp.missouri.edu/research/investment-risk-tolerance-assessment/
- Mikeska, M. (n.d.). Creating Balance in Financially Diverse Partnerships When She Has The Money.
- Zakrzewski, A., Reeves, K. N., Kahlich, M., Klein, M., Mattar, A. R., & Knobel, S. (2021, July 5). Managing the next decade of women’s wealth. BCG Global. Retrieved September 5, 2022, from https://www.bcg.com/publications/2020/managing-next-decade-women-wealth
- Zeamera, C. A., & Estey, A. J. (2021). For Love or Money? Factors Associated With the Choice Between Couple-Based Versus Individual Financial Coaching. Journal of Financial Counseling and Planning, 32.