"Sometimes I feel like I'm doing a little couples therapy in my financial advisory sessions. And nothing makes me happier than watching a couple visibly relax once they get their finances in order." - Katy Song, Financial Planner.
More than just who's right and who's wrong, it takes a little patience, a lot of respect, and some hard work for couples to fix their money issues. Take it from Mill Valley-based financial advisor extraordinaire (and mom of two), Katy Song. This former San Francisco investment banker and graduate of Berkeley's Haas School of Business will whip your relationship back into shape in no time. And, if after reading her article you still can't get it together, check out Katy's website to take a look at her amazing financial advice packages for families in Marin County.
No one likes to fight about money, so why does it happen? There are three main reasons rational couples fight about money.
by Katy Song, Financial Planner
You and your spouse are different “money types." It is more than just “saver” versus “spender”. It relates to how you perceive money and its role in your life. Some are inherently optimistic about money and believe everything is going to work out. On the other side, some believe they are one step away from a life in the streets. It is abundance versus scarcity.
Opposites attract at first but as life gets more financially stressful, these differences can cause tension. There is a communication breakdown from not accepting each other for their money type. To get past this, accept each other. You cannot change money types, but you can learn to respect each other and communicate better. Try this exercise: Write down a description of how you see money and of your partner’s relationship with money, then share what each of you wrote. Agree in advance that this exercise is not meant to be judgmental but to help you better understand each other.
You do not have shared financial goals or maybe you have never talked about it. Try this exercise: Start simple with one page and a big marker. Together, decide on what matters most to your family, such as: owning a home, travelling the world, getting the best education, or having a stay-at-home parent. These goals are not mutually exclusive, but you will need to decide which ones are most important and where to focus your resources. This is your One Page Financial Plan.
You are not sharing responsibility. Often one person does all the work because he/she is a proclaimed financial person or the other person feels they are no good at managing money. With the work comes worry too. You both need to know what is going on at least on a monthly basis. You both need to be able to answer these questions: How much did your family spend last month? What are your savings goals? Have you made progress towards them? Work through the exercises under each section. It takes work to be on the same page about something as serious as money. The happiest couples and the ones with the best chances of reaching their financial goals have Clarity, Communication and Respect for each other.