Editor’s Note: This is a guest post from Patty Moore of Working Mother Life.
For many couples, money is a major source of tension within a relationship.
In fact, in a 2017 survey, 49 percent of all respondents considered money to be the most critical and stressful factor in their relationship. Undoubtedly, problems with money can cause strain in a relationship. From arguing over having too little money to how money is spent, finances can play a major role in the health of a relationship.
That is why it is so critical for couples to work together and communicate in order to effectively work together as partners and to reach their financial goals. Talking openly and honestly about finances can not only help couples avoid many of the most common relationship stressors, but it can also help them plan for the future.
By working together to set financial goals, couples can achieve more by working in concert — instead of against each other. Here are some tips on how you can set financial goals with your spouse.
Make a List of Your Goals
The first step in setting financial goals is to actually have financial goals in mind. Perhaps you want to retire early, to move out of the city and into the country, or even to change careers. Having each partner make a list individually of his or her goals for the coming year can help define what is important to him or her.
This list can include anything from practical ideas, such as having more money in an emergency fund, to more exotic goals, like taking a round-the- world trip. The key is that you are spending time privately to figure out where you want to be financially, so that you can then work with your partner to make a joint plan.
Set Aside Time to Talk
Once you each come up with a list of your individual financial goals, sit down and share your lists and talk to each other about where your lists differ — and where they are the same. If you have a lot of common ground, such as a shared desire to put as much money into retirement savings as possible, that is fantastic — you are well on your way to a harmonious relationship, at least in terms of financial goals!
If you find that your lists are wildly divergent when it comes to financial priorities, you may have more work to do. For example, if your partner wants to save money for what you think is an unnecessary kitchen renovation while you want to put aside more money for an emergency fund, you will likely have to communicate more to determine how to come to a middle ground on
Combine and Prioritize
Once you have talked out your individual lists, combine your individual lists into one joint list. In doing this, make sure that you order your list in terms of what is most important to you as a couple, such as paying off all of your debt. The key here is to work together to decide what is most important to you, rather than having one partner decide for both what is the top priority.
Because both partners will be working on the goal, it is critical that each buys into it in order for it be successful.
So work as a team to come up with a ranking that works for you. Perhaps you can focus on paying off student loan debt as a top priority, and then move onto saving for a new car or big trip or other goal as an incentive working towards reaching the first goal. By coming together to set financial goals for 2018, you can avoid many of the disagreements over money that many
Create a Spending Plan Together
In order to reach your goals, you will need to have a budget or a spending plan that is realistic and based on your income and expenses. Sit down with your partner and work through the details of your budget, examining items such as your current monthly income and expenses.
Working collaboratively with your significant other, decide how you can tweak your budget to reach your financial goals in 2018.
For example, you might be able to cut certain costs, like cable or eating out, in order to make extra payments on debt or put money into a vacation fund. By deciding on this plan together, you will be better able to make it a reality — and there will be a lower risk that one partner will undermine the goals.
Patty Moore started blogging when she got the idea for Working Mother Life, her personal finance blog. Check it out to learn more about her journey as a single mom.