Four Tips on using Family Budget Planning to Bring Sanity to Your Relationship

Four Tips on using Family Budget Planning to Bring Sanity to Your Relationship

Don’t Surprise Me Again, Please.

Julie was about to enter the house when she noticed in her peripheral vision something shiny hanging in the corner of the garage. She did a double take, walked up towards it to be certain, and then with sunken shoulders slowly made her way into the house as most of the color left her face. He did it again! This was the third time this year that John spent a large sum of money without talking to Julie first. While she absolutely loved their Hawaiian vacation, and understood why John would “lend” his good friend money, it felt like this very expensive mountain bike he purchased was the last straw. Julie was very angry and frustrated and didn’t know what she was going to do. After all, their credit card debt was growing even though they had talked about how to lower it. They simply could not afford to be spending all this money! And to make matters worse, she knew John understood this and she could see why he never talked about his plans until after the fact.

Julie & John are certainly not alone in their struggle over money management. It is estimated that almost 80% of all divorces are due to conflicts over money and couples fight more about money than anything else! If family budget planning is given the proper attention it deserves and these four money-related tips are followed, any relationship can become much healthier.

1. Pssst, No More Secrets!

As the example above demonstrates, spending-related secrets can not only cause significant relationship distress, but it can also sabotage one’s family budget planning. Neglecting to tell your partner about a major purchase can easily cause resentment, hard feelings, and even more importantly, can destroy the trust in your relationship.

While a majority of couples can discuss sex, religion, and even parenting issues, many couples have a very difficult time broaching their financial matters in any depth. It is important to communicate not only what each of you spends, but disclosing all financial information (especially at the beginning of a serious relationship or marriage) is also very important. This includes what you earn, your savings, inheritance, debts, student loans, and the quality of your credit.

2. Get on the Same Page

Sharing the “basics” of your financial matters with one another is really only the beginning. Couples then must move on to discuss their family budget planning. The first step involves sharing with each other your “financial philosophies.” You each bring to your relationship different past experiences that can influence how you think and feel about money. Some of us are frugal and tend to be conservative with money while others are free spenders. After acknowledging any differences, it is important to compromise by meeting somewhere in the middle. After understanding why your partner has a specific philosophy about money, it often becomes easier to accept some of their money decisions.

The next step in family budget planning is to discuss your financial goals. These should at a minimum include saving for kids’ college fund and having a specific retirement plan. But it may also include getting out of debt, purchasing a house, buying a new car, or even taking a dream vacation.

The last step in your family budget planning is to actually set up a budget that is consistent with your agreed-upon financial plan and that also takes into account your family goals. Remember that it is important to keep in mind that the final budget usually should not be more than the combined family income unless going into debt is agreed upon and only for a short period of time.

3. Balance Freedom & Security

So now that you’ve discussed your family’s financial goals, outlined your family budget planning, and agreed-upon a financial plan, there are a couple of suggestions that can make a huge difference. Everyone wants to feel some degree of freedom to purchase what they choose and also have a sense of security that your partner won’t go for broke.

Following these two guidelines can help a great deal:

1. Come up with a certain amount per month that each partner can spend on whatever they choose with no questions asked. This set-up provides the freedom so that you don’t have to be accountable for 100% of what you spend. Often, this can make a huge difference for some partners who feel too reigned in or controlled by their partner.

2. Together make an agreement that any expense over a certain dollar amount MUST be discussed before being spent (unless guideline #1 applies). Any amount below such dollar amount can be freely spent without having to talk to your partner. This will provide you with the security of knowing that your partner can’t exceed this dollar amount without consulting with you first.

4. Be Certain You’re Really Talking About Money

Since financial discussions and disagreements often involve concrete subject matters (a specific purchase, decision, or object), it sometimes is easier to argue about finances instead of the “true” underlying issue. Frequently, couples will be in conflict about an unrelated issue (such as parenting differences or problems in their sex life), but it will be “acted out” by arguing over the concrete subject of money (usually about a specific purchase or decision). Therefore, it is particularly important that each partner think carefully before launching into a discussion or concern over money to ensure that there is not an underlying issue that is the actual problem. Try to first resolve the other issues before taking on the difficult subject of finances.

Hold On a Minute

I don’t think my partner is hiding anything but he is the one who takes care of the finances and I don’t really have a good sense of our financial picture. Is this a problem?

Ideally speaking, the responsibility of the household finances should be shared between partners. Sometimes because of one’s skills, interest or availability, it is not uncommon for one partner to handle the bulk of the financial responsibilities. If it is not possible for each partner to truly share such responsibilities, it is important that both partners are involved and aware of how your family’s finances work and that big decisions are made together.

My girlfriend will go shopping and bring home tons of clothes and is spending more money than we can afford. How can I get her to stop?

Although you are not married, if you are combining finances it is important that you also follow the “Get on the Same Page” guideline. If you’ve already discussed financial philosophies and goals, and together decided on a budget, then you may need to tactfully confront your partner about her spending habits. If this were to continue after reviewing your budget and financial goals, the two of you may need professional help to resolve your situation.

Our budget is so tight right now that we don’t have enough money in order to come up with a monthly amount that we each can spend without accountability as you suggest. What else could we try?

For the sake of having some financial “freedom,” I would encourage some amount – even if quite small – to look forward to being able to spend. If finances are too tight right now to afford any monthly amount, perhaps you could come up with an amount that can be spent every two or three months. Alternatively, if the two of you can agree on a vacation idea, each of you can save a certain amount per month for a “vacation fund.”

My husband has blown up at me recently about some very minor purchases I’ve made. I suspect he’s really upset about our infrequent sex life, but hasn’t mentioned it. I’m not sure how to approach this.

The best approach would be to tactfully, but directly, talk to him about your suspicion that his frustrations over your sex life seem to be the reason he’s bothered you about your recent purchases. Hopefully, if this is the case, he will acknowledge it and then the two of you can focus on your sex life. If it turns out that he is sincerely upset about your spending patterns, review with him your budget and financial goals that the two of you have already set-up.

In My Practice…

One couple I recently worked with strongly disagreed over finances. They came in feeling pretty hopeless and stuck. The wife started off feeling very controlled and resentful. She felt that since she earns money, her husband has no right to try to put limits on her spending. The husband, on the other hand, was the budgeter and initially saw his wife as the continual “budget buster.”

After each partner described their perspective of the current situation in our first session, I had them sit down and express their financial philosophies to one another. (They really had never done so.) In the third session together, they discussed and set up the framework for their financial goals including their family budget planning. In order to address her desire for freedom, they agreed on an amount that they each could spend every month without having to be accountable to one another. To satisfy his desire for security, they also agreed on a dollar amount that if they exceed, they’d have to consult one another. As a result, she began to feel much more secure without feeling controlled. The husband also experienced a big relief that he would now be informed before she would make a “big” purchase (over their agree-upon limit). The next time I saw them two weeks later, they were both very happy with their family budget planning and the system we set-up. Interestingly, other relationship issues they had presented were now “not worth” addressing any longer. As is the case with many couples, it appeared that the stress of their financial conflicts exacerbated other minor issues.

Summing Up These Financial Tips

1. No Secrets. It is important to communicate all purchases and financial information to one another. Not doing so can ruin your family budget planning and destroy trust in your relationship.

2. Get on same page. Share financial philosophies and goals. Compromise if necessary and decide on family budget.

3. Balance freedom & security. Together decide on: 1) Amount each of you can spend per month without any accountability. 2) Dollar amount that if you exceed, you MUST consult with your partner before spending.

4. Be sure you’re really talking about money. Be certain the money matters you raise with your partner aren’t due to underlying frustrations stemming from other issues in your relationship.

Give It a Try…

Agree to run with this plan for three months, and then talk with each other about what needs to be adjusted. If either one of you feels too controlled or resentful, or has a hard time sticking to your commitments, you may need a professional to help you navigate the situation.


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