Money and finances play a significant role in personal affairs; mismanaged, they can cause irreparable damage. Relationships are hard enough; why add money troubles when they can be avoided when faced and handled together. How do you recognize possible financial issues and prevent ruining your relationship? Let’s talk about five financial challenges couples experience and ways to avoid them.
Limited or Low Income
Many relationships begin when we are young, inexperienced, and have limited income. This situation may cause worry and stress early on, but with careful planning, this can improve. It is also common during this time for one partner to have a higher income than the other. Be considerate of your partner during this time because it can cause resentment, share the responsibility of finances no matter who brings in more. Avoid turning the disadvantage into a power grab.
Overspending and Setting Spending Limits
Sometimes people spend money without thinking about it. Buying a coffee, lunch with coworkers, new clothes, and other simple purchases can add up over time. If one partner is doing this, the other might feel they are being overlooked or their efforts to save money are not being taken seriously. The best way to handle this is to set spending limits or budgets and keep it even; one may spend small daily amounts, while the other spends less but makes a larger purchase later.
Allow for each to have the same amount of spending money, choosing to spend or save as they wish. Couples need to work at their relationship; it takes dedication, understanding, and commitment. Sometimes we expect too much or too little from our partner, and finding ways to create a balanced relationship might require a little information and self-education.
Not Sharing Investment Decisions
Investing in your family’s future is a smart choice. However, if only one person is making all the investment decisions, it can lead to problems. If bad investments are made and money is lost, this will lead to blame and resentment. To avoid making bad investment choices, partners should work together. There are tools and websites available, like high dividend stocks websites, to research investments together. Remember, investments are intended to improve life in the future; make sure you are on the same page regarding everyone’s needs and expectations about the future.
Keeping Debt Firmly in Control and Taking Responsibility for Your Part
Debt can be incurred before and during a relationship. Couples need to be aware of each other’s debts before entering into a long term commitment. They also need to agree on whether they will combine previous debts or be responsible individually for previously incurred debts. Set aside uninterrupted time to decide whether you will keep those debts separate or combine your debts.
When debts are separated, plan and a budget so that each of you can pay your debts using your income. When combining your debts, talk about them openly, and create a budget to pay off those debts as quickly as possible. You don’t want those old debts causing tension or arguments. Work together to avert creating unmanageable debt as your relationship and finances grow, agree on spending limits, including credit card use, and set a specific dollar amount the requires consulting each other before spending.
Family and Children Create Different Financial Problems
Start by always facing any financial problems concerning family members and children as a united front. If your brother wants to borrow money or your partner’s parents want the family to take a vacation together, let them know it requires a mutual discussion and decision, and one of you will get back to them soon. Always respect your partner’s needs regarding family and make sure your needs are being met.Children are a mutual commitment. You should both have an equal say in financial decisions about caring for children. You may need to decide on school tuitions or extracurricular activity expenses but always do it together. As your children grow and mature, take advantage of these situations as a learning opportunity. Teaching children about financial responsibility works best if you start when they are young and explain the positive and negative sides of financial accountabilities. Keep an open mind. Sometimes kids might surprise you with approaches to financial issues you hadn’t thought of before.