It is often stated that money is one of the primary causes of divorce. While I have never been able to find a real statistic to back up this claim, there is no question that, whenever I come across a couple facing struggles, finances are usually one of the variables in play. In my experience, this highlights the old adage ‘opposites attract’, which definitely applies to the ways we view money and finances.
Typically when it comes to money, there are two distinct personalities in a relationship. There is the diligent, disciplined and money conscious individual and there is the carefree spirit who, for a variety of reasons, doesn’t want to be bothered with the complexities of money. Unfortunately, it often becomes a tug of war between the two. The carefree spirit feels that the money conscious partner is nagging and overbearing. The disciplined partner believes that the free-spirit doesn’t care, and internalizes this to mean that this person also doesn’t care what happens in the future. Both feel that the other doesn’t value or respect their view on money, and the end result is an underlying frustration that can build over time and manifest itself in other situations. The carefree spirit can easily be pushed away and the money conscious can easily blame the other for their current financial situation. While frustration and marital problems can certainly be the result, inevitably there is one common theme, zero financial progress.
For any relationship to work, there has to be compromise. While we live in a day and age where equality has become the norm, it is foolish to think that both parties in a relationship should approach family finances in an equal manner or have the same responsibilities. The sooner you delegate who does what, the better off you’ll be. This is not rocket science, but it does take some humility.
Identify the Chief Financial Officer – CFO
In any organization, there is typically one person who handles the books and finances. It is their responsibility to pay the bills, set the budget and set the financial plan. A critical component, not to miss, is that they also report their actions to others in the organization, seek feedback and guidance, and their job is not done in isolation.
In your marriage, one of you must take on this responsibility. Maybe you’re already doing this and have been for years, but now it’s really time to own it. Furthermore, and this is a big one, stop being bitter about this. You may feel that this shouldn’t be your job, that your spouse should take more interest, that you feel lonely, stressed or under significant pressure. I will speak to the other individual momentarily and attempt to throw you a bone, but in the meantime, get over it. Stop throwing this pity party for yourself and accept the responsibility. Rather than feeling burdened or bitter, be thankful that God gave you this ability and the desire to right your financial ship. The sooner you understand that your partner’s hatred for this area does not mean they feel this way about you, the better off you’ll be. CFO’s or bookkeepers don’t walk around feeling bitter that others in the business don’t help more, and neither should you. Own it, and become the best family CFO there is.
While one of you takes the lead, as CFO, the other will take a supporting role. If you’re the male in this role, this can be a difficult pill to swallow but here’s the deal; if it’s not your gift or passion, allow your wife to handle the funds and be the best darn support person you can be. Stop feeling as if she’s trying to suppress your inner manhood, because she’s doing nothing of the sort. Just because she doesn’t want you to eat out each day for lunch with the guys, doesn’t mean you can never eat out again. It simply means that she’s trying to follow a real budget and a real plan that, when executed, will lead to a much less stressed wife and a much better life. If you are the female, in this supporting roll, I need you to do one thing even though it’s hard: pretend you care and engage with your husband when he wants to review finances – even if it bores you to death. Long ago, my lovely bride learned that it is much easier to engage with my crazy antics; and, while most of the time I think she’s pretending to be interested, it’s precisely what I need to keep pressing forward. Whoever occupies the supporting role, your job is to be involved in the process and provide encouragement along the way but not to be in charge of the finances.
Neutral Territory Meetings
Once the roles are established, it is critical to have a regular dialog regarding the budget, the overall financial picture and any goals that you have. Here’s the trick, this discussion cannot be at 7:15 in the morning, when you’re rushing to get the kids to school and off to work. This cannot take place in the heat of the moment between sports practices or ball games nor, in my opinion, should it even be at home. It has been my personal experience that any in-depth financial discussion is much better held at a neutral spot, when there are few distractions and the anxieties of the day are left behind. It would be fantastic if this could take place during a date night Maybe you’re not financially able to include this in your budget, and so you’ll need to get creative; perhaps a quick jaunt to the local Starbucks for a coffee or meeting for lunch. I can’t stress enough how important consistent dialog with your spouse is regarding your financial affairs, and I also feel that a neutral spot is key. If you struggle finding the time to do this, I’d revisit your schedule and your priorities. Speaking about money is one of the most important areas in your relationship and demands a slot at the highest priority level.
Goals & Dreams
When you meet to discuss your financial situation, it is key that the CFO be prepared to review such items as the monthly budget, current financial position, outstanding expenses and the like. Owning this role doesn’t just mean you log receipts, while catching up on Netflix, but rather it is your job to set the overall direction and course of your family’s financial future. A well prepared CFO is ready to discuss the current as well as the future.
This leads me to my next topic of conversation. Let’s face it, the budget and current expenses are unexciting, at best, and often create a level of anxiety that you may feel when addressing your finances. This is normal, and it’s certainly not easy to get excited about your financial picture when you’re facing bills that you don’t have money to pay. Unfortunately, there is no way around it and the best course of action is to push through. We’ll discuss creating more forms of income in the future. One of the things that helps us is to make sure that some of this meeting time is spent on addressing, revisiting, or setting goals and dreams. There is nothing like setting and achieving financial goals with your partner, and I can tell you for a fact that, while money is one of the biggest potential wedges between marriage partners, it can also be one of the things that cements a marriage. Other than raising your children, there is very little a married couple can do together in order to identify and witness tangible results. It feels pretty darn good when you reach financial goals. Maybe, right now, the goal is simply to track your expenses consistently from now on. Maybe it’s to pay off that pesky credit card, tackle the car loan or get aggressive with the student loan. Maybe it’s to pre-plan your Christmas spending, set aside money for a vacation or, who knows, pay off your house!
I can vividly remember when my wife and I paid off our very last credit card. We went to a local restaurant and brought a pair of scissors to cut up the card while we sipped our wine and enjoyed our meal. The funny thing is, that since that time, we’ve been able to accomplish financial goals that were far beyond paying off that credit card; but, that moment remains the one that is the most memorable and I know exactly why. After we paid off that card, I remember thinking that we could do anything together. We dreamed of paying off the remainder of a car, student loans and ultimately a bigger house. Fast forward 15 years; my wife and I are now completely debt-free, including the house. It’s mind-blowing to think of what you can accomplish as a team.
This is something I think is critically important; when you hit milestones, I believe, there must be rewards. Now, I’m going to assume you won’t be an idiot with this. For example, buying a 70” TV after knocking out a credit card is pretty dumb; instead, take an evening out and enjoy a nice dinner. Maybe your objective is to track your expenses, and you decide that when you meet this goal you’ll treat yourself to a date night. Maybe your target is much bigger and you desire to knock out that car debt and accomplishing this will create an additional $400 per month in cash flow. The minute you do this you decide that you’re going on an overnight date trip and will spend the first month of excess cash. Whatever it is, I think it’s critical to set a reward that is proportional to the goal obtained.
The key to any successful relationship is communication in many areas and, in my opinion, the biggest and most important is your finances. Start this process today, and stop letting the stress or anxiety of money impact your relationship. Travel down this path and, in the near future, tell me how it’s going!