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Saturday, June 4, 2016

Money in Marriage

     Let’s face it, money challenges can create an enormous amount of stress in a marriage and if we aren’t careful it can destroy our marriage.  Here are a few guidelines that will help you avoid many of the financial pitfalls that can occur. 
Live within your means- I know this seems simple enough, but you would be amazed how many are living on borrowed money.  Unless it is your home, an education, possibly a car, or starting a business, stay away from debt.  Learn to live simply and buy used items.  You don’t need the fancy furniture, expensive cars, huge mortgages, and expensive clothing.   Did you know that a car loses over 70% of its value in the first four years?  A car that is only four years old has a lot of good life in it and most are still very reliable. Let some other person lose the value while you take advantage of not having to pay inflated prices for a vehicle.  We bought a car for our son, paying $2,000 cash for a car that was 14 years old.  It has run great for over two years, needing minimal repairs.   With an average basic car payment of $250 a month, we would have spent $6,000 so far for a car that gets him around exactly like his older car and would still have three more years of payments to make. Instead after nine months we were money ahead, even if the car did break down and we would’ve needed a new one.  It was well taken care of and still looks great. Shop around.  Learn to shop sales, garage sales, and limit your spending to an amount that you can reasonably afford.  Make your money work for you.  Debt can act like a ball and chain wrapped around your neck.  It can bring a large amount of unnecessary stress into your marriage that could be avoided by being patient, setting up long term goals to get you where you want to be, and living wisely.  In the meantime, learn to get by on less.  When you see others with fancy things, be grateful you don’t live their nightmare of debt but can live in peace because you don’t owe other people.      
Tell the whole truth- Taking responsibility for your actions is absolutely necessary for you to win with money.  Owning up to your mistakes with courage, humility and openness is a huge step in the right direction.  Do not leave out details, as this will only lead to more pain for both of you in the end. 
Talk Honestly- If you are bringing debt into the marriage, be open about what that debt is from, how much it is,  and what you are doing to address the debt.  If you have accrued debt unknown by your spouse, fess up.  One of the key components to a good relationship is trust.  If you have broken trust in your financial areas, take responsibility for it and do what you can to right it.  Realize that your spouse may be upset for good reason, but at least you can start to heal and fix it.  Ignoring it will only hurt marriage.  If you have created the mess together, then sit down and honestly look at the debt and analyze how you managed to get in the mess you are in.  Sometimes we are in a mess due to medical issues, natural disasters, etc.  However, most of the time we have something to do with the mess we are in.  Acknowledge the part each of you played and make a plan to get out. 
Listen to your spouse- Listen without defending yourself. Simply let your spouse be heard.  Acknowledge their feelings. Apologize for any part you played in the problem. 
Work Together- Collectively brainstorm ideas of how to fix the issues, with no judgments on the ideas.  If your spouse suggests an idea and you think it’s stupid and tell them so, do you think they are going to continue to brainstorm ideas? Nope.  All creativity was destroyed.  Brainstorming is just putting ideas down, then you go back and choose the best ideas from the list you created.  The key is to realize that this isn’t his problem or her problem, it belongs to both of you. 
                When my husband and I were first married we had similar goals but handled money differently.  We disagreed about how to go about handling the money and would end up fighting about it.  Finally he said, “Okay, I will make the money and you run the home.”  This ended a lot of fights.  However, in time this became a huge problem.  He had no idea where our money sat, he literally turned it all over to me.  As we began to really struggle financially I had a huge burden of making the money stretch.  When I would ask for advice of what we can do, or which bill to pay first, etc. he would get defensive, feeling like a failure for not being able to provide for the family, which sent him into a depression for weeks.   Therefore, I felt like I was all alone in trying to figure it all out, which caused frustration and resentments to build.  Other times he would ask me if we had money to do something he wanted to do and if possible I would juggle the budget around to make it happen.  If I asked him the same question, the answer was always we don’t have enough money.  It began hurt my feelings and the resentment built.
                One day we sat down to discuss it.  It was no longer working.  I asked him why he always said no to me and he said “I have no idea how much money we have so I just assume we don’t have it.”  That was my “Ahha” moment.  We created this problem because we weren’t communicating about the money.  He was absolutely clueless of where the money sat, and what bills we had, because I had always handled it.  This was just as much my fault as his.  Without him being aware of our money and the budget, it was creating miscommunication and huge misunderstandings.     
                We learned the importance of sharing the burden, being informed of where the money was going, and of making a budget together so that we could both be fully aware of our finances.  I will admit that it hasn’t been easy.  However, we understand the need for both of us to be actively involved and to be accountable to one another for our financial lives. In short, we must work as a team if we want to be successful with money.    
Create a Working Budget- Decide together if it is a budget you can keep.  Be honest with yourself and each other.  Each month sit down together and go over your expenses and then decide where all of the money is going.  Don’t forget to give each spouse “play” money that doesn’t to be accounted for.  That can be ten dollars or a hundred depending on your budget.  However, everyone needs a little flexibility or the budget will never work.  Sometimes the idea of a budget freaks out people who are free spirits.  It feels like bondage to them.  However, by budgeting in wiggle room it can give them a sense of freedom.  True freedom comes from living within certain boundaries that protect your way of life.  Wild abandonment will cause heartache and ruin.
Be Accountable- Check with each other and work as a team to prevent bad habits from kicking in.  If necessary get a financial counselor to help you.  If you agree to the budget, then keep your end of the deal unless you discuss it together and decide to change the budget based on something you failed to plan for.
Continue to Communicate- Life happens.  Big emergencies and small emergencies come up and the budget has to shift to accommodate unplanned expenses.  You can’t be successful if you aren’t keeping an open communication channel open between you. 
Share your Bank Account- Some people like the idea of having separate banking accounts because they don’t want to assume the risks involved in sharing their money, wanting to stay independent.  However, why would you marry if you have intentions of divorce?  This is where trust comes in.  I know a man who gives his wife so much money at the beginning of each month and then she has to account for every penny of it before he gives her any more for the next month.  This is more of a father/dictator role, not a role of a loving spouse.  He maintains all control of the money.  He is telling her loud and clear that he doesn’t trust her, nor thinks she is capable of handling money.  Not a great foundation to base your relationship.  Even if the wife has her own account and the husband has his, it becomes more of a checklist of who is responsible for what bill, rather than WE are responsible for these bills.  My husband’s grandmother never touched money, the bills, or the budget in their home.  He died, leaving a huge estate behind.  All of a sudden at the age of 85 she was not only faced with having to learn how to write a check, but now had to manage a million dollar estate.  It was foolish and cruel to leave such a massive burden on her.  If your spouse doesn’t know how to manage money, teach them.  If you don’t know how, study and learn how.     
Learn your money style- Each of us have certain money personalities.  Some of us are savers, some hoarders, some free spirits, and some spenders.  Regardless, by understanding what both of your styles are, it can help you work with it in a budget.  If you tie down a spender so they are held captive by the budget, they will break it and start to hide the money they are spending.  However, if you make room in the budget for them to play with, they can also be successful in the budget if you agree on a compromise between you.  If you are curious as to what your money style is go to https://www.moneyharmony.com/moneyharmony-quiz and take the quiz.  It takes less than ten minutes.  Just remember, no style is the wrong style.  It’s just different and you need to accommodate for the differences.  Respect the hoarders need for security and the spender’s need for freedom in the budget.

                By following these tips you will gain more confidence and control of your finances as you successfully work together to create common goals towards your future.  By accepting accountability and being honest, you are creating more trust and intimacy in your relationship. 
Challenge
1.       Discover your Money Personality
2.       Develop a budget together
3.       Discuss how your parents dealt with money.
4.       What does Money represent to you?  Your spouse?
5.       Share your dreams for the future and what you hope to accomplish with your money. 

References
Real Debt Help - Get out of debt with Dave Ramsey's - daveramsey.com. (2016). Retrieved June 02, 2016, from http://www.daveramsey.com/blog/

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