3 Tips on Forming a Fight-Free Financial Plan for Your Family
Please enjoy this week’s post on marriage and money written exclusively for Mad About Marriage by Sophia Emma!
Whether we’d care to admit it or not, money can spark some of the biggest family fights. In fact, Bride’s article on common arguments states that money is allegedly responsible for up to 19% of fights within a 15-day period. This is most likely attributed to the fact that money, as a finite resource, can bring up feelings of power and autonomy. In close settings, like among married couples, this can lead to explosive arguments that often end up bleeding into other non-finance-related areas. For example, the American Institute of CPAs recent survey on cohabitating couples shows that 73% of couples cite money decisions as a source of tension.
That said, since money is an essential part of life, it’s essential for families to find healthier ways to manage it. Although some money-related sensitivities are inevitable, here are some ways to help make financial planning less stressful for the family:
Ask the difficult questions
While most people like to think family finances are split 50/50, the reality is rarely like that. So rather than finding this out the hard way, talk openly about money as soon as possible. As explained in Mike Tucker’s post about managing money after marriage, resentment can fester when couples leave financial matters unaddressed. So, before any arguments or bad feelings even begin, don’t be afraid to ask difficult money questions. Who pays for what bill? Will the main earner pay for more? How are we accountable for each other’s expenses, if at all? By asking these questions early on, you have the advantage of being on the same page. From here, all decisions related to your financial planning will be built on honesty and clear expectations.
Too often, we get hung up on the ‘what’ before we even establish the ‘why’. In financial planning, this can lead to frustrations stemming from not understanding the bigger picture behind certain financial decisions. Therefore, make it a point to talk about your family’s financial goals together. This way, you are mutually dedicated to a clear and vivid picture that benefits everyone. As detailed in a breakdown of budget components on AskMoney, the proper way to establish goals must include short- and long-term goals. This could mean setting aside money for a vacation as a short-term goal, while having an education fund set up as a long-term goal. With these in mind, it is easier to buckle down as a unit and work together to accomplish them.
Check financial records together
Admittedly, budgeting and financial planning is not the most fun shared activity. But going over your records together can have longer-lasting benefits. New research on couple finances on CNBC reveals that couples who crunch numbers together are more likely to stay together. This is because sharing the experience of financial planning with loved ones encourages better communication and cooperation. This leads to a more unified front that means it’s easier to get through money tasks in general. For romantic partners, pooling your money, reviewing financial history, and doing the math together can even lead to better relationship satisfaction because “my money” becomes “our money”.
In conclusion, while financial planning can be challenging, it doesn’t have to be the cause of negativity. Although money gets a bad rap for disrupting peace in families, when financial planning is tackled with transparency and unity it becomes a much easier and more pleasant task.