Financial Trouble In Relationships
by Richard Taylor, BS, CAMF
Often couples encounter disagreements over finances.
The couple has different spending habits and saving habits.
The U.S. government teaches us it is OK to spend more than we bring in.
This doesn’t help our own households.
In order to not be evicted from our houses and apartments, lose our autos, we must live within our income or dire consequences result. We cannot print more money.
Two Checking Account System
For those who are not married but living together the most often model used is two separate checking accounts. Each person who works put income into their own checking account and spend as they want. The shared expenses of rent (mortgage), utilities, water,
trash disposal etc are then negotiated between the two. In some cultures the man covers
all these expenses “providing” for their partner. In the US it most often a shared arrangement to whatever works for the couple. Some use the 50-50 model. When incomes are quite different where one makes much more than the other often the percentage reflects that. The bills are then paid out of the separate accounts. This works well for 2nd marriages as well.
It is important both comes to terms with over spending and creating a budget so you know where all your money goes. For one month track every penny spend by keeping receipts and by keeping a small notebook where you document every cent spent. Be sure to include auto bank withdrawals that can add up fast. Also money spend of coffees, cigs, drinks on the go, etc.
Then either on paper or with software input all your expenditures. The most popular software for doing so is Quicken by Intuit. I also like the cheap My Budget Planner Software. Many follow national radio host Dave Ramsey and cut up all their credit cards.
This makes you pay “cash” for everything and keeps you honest. No money equals no purchases. Debit cards will allow online purchases, travel purchases etc.
It is important you keep the emotions neutral and more rational and do not blame one another when discussing your financial situation. Your finances are a result of learned behaviors or no planning at all. Work as a couple to figure out what works best for you.
Really no one can do this for you. It is a give and take to what works for each partner.
A consistent attention to this will help you resolve your issues with finances. Both people
need to be on board for this to work. Learn to become responsible adults.
One Checking Account System
For those who are married for the first time Dave Ramsey, financial expert suggest one checking account for both. All income is collected and spend from here.
It is very important that you have an agreement and keep it as to the highest amount that can be spend by one spouse without the others OK. This amount will vary for each couple depending on combined income levels. The average couple who both work may have a combined income of $50-80,000. So they might agree that any expense over $200 or $250 needs approval by the other spouse. For wealthier couples it might be $1000 or $2000. How much disposal income will help determine this amount.
It is important both comes to terms with over spending and creating a budget so you know where all your money goes. For one month track every penny spend by keeping receipts and by keeping a small notebook where you document every cent spent. Be sure to include auto bank withdrawals that can add up fast. Also money spend of coffees, cigs, drinks on the go, etc.
Then either on paper or with software input all your expenditures. The most popular software for doing so is Quicken by Intuit. I also like the cheap My Budget Planner Software. Many follow national radio host Dave Ramsey and cut up all their credit cards.
This makes you pay “cash” for everything and keeps you honest. No money equals no purchases. Debit cards will allow online purchases, travel purchases etc.
It is important you keep the emotions neutral and more rational and do not blame one another when discussing your financial situation. Your finances are a result of learned behaviors or no planning at all. Work as a couple to figure out what works best for you.
Really no one can do this for you. It is a give and take to what works for each partner.
Controlling spouses help bring them to me for anger issues help. Realize that each spouse needs some money each month for personal expenses that are not tracked except under Personal Expenses column. Often this is for pedicures, hair appointments, facials, massages, golf outings, girl’s night 0ut or guys night out, etc. This helps avoid arguments and being felt controlled. Not even two years olds like being controlled. No!
A consistent attention to this will help you resolve your issues with finances. Both people
need to be on board for this to work. Learn to become responsible adults.
Three Checking Account System
For those First Marriages and also Second Marriages many prefer having three checking accounts.
Usually both partners already have personal checking accounts so you open a joint account in both spouses name allowing access to this account. You would list the other spouse as beneficiary on you own personal account in the event you die.
Each person who works put income into their own checking account and spend as they want. Money is deposited into the joint account according to income levels. The shared expenses of rent (mortgage), utilities, water, trash disposal etc are then paid from this account. When incomes are quite different where one makes much more than the other often the percentage reflects that.
Follow above advice for budgeting and setting goals.
Remember that no matter how you do it, the important thing to accept that Financial Independence is created by two willing creative partners invested in changing their money habits. You can do it. Both can act responsibly. Expect it to take a while to work out the kinks and actually make it work. If it was easy the US government would not owe trillions of dollars in debt. And neither would you!
Start today.
If you continue to have conflict then see a professional in Financial Planning
or if angry or rageful an Anger Management Counselor/Facilitator.
We offer Individual Sessions for Couples for financial dialogue that are structured
to avoid fighting.
Director Richard Taylor BS, CAMF
Certified Anger Management Facilitator
Atlanta Anger Management
5555 Glenridge Connector
Suite 200 (2nd Floor)
Atlanta, Georgia 30342 USA
Phone: 678-576-1913
Fax: 1-866-551-1253
Web: www.atlantaangermanagement.com
E-mail: richardtaylor5555@gmail.com
Linked in: http://www.linkedin.com/in/richardtayloraam
