Given that money troubles are infamously the leading cause of divorce, it’s clear that financial mistakes are a common problem for many modern couples. While some fiscal problems are harder to correct than others, there are mistakes you can avoid and steps you can take in your relationship to help minimize your chances of falling victim to a cash crunch. Here are a few of the biggest.
1. Communication Breakdown
This seems so basic, but communication is often overlooked. Remaining open to discussing everything with your partner – including money – is important to the health of your relationship. Failing to discuss a small financial issue can lead to it becoming a large financial issue for no reason, so set aside a time to talk on a regular basis to keep each other informed.
2. Dishonesty
A good relationship is built on trust, and it is vital that this foundation extends to your spending habits as well. No matter how troubled your finances are, you should not let embarrassment stop you from telling your partner all about any nasty details hiding in your credit report. This can be especially hard to do if one spouse is doing significantly better financially than the other, as the fear of being judged can easily cloud your better judgement. If you find yourself in a bad financial spot, it’s important to keep in mind that your relationship is a partnership and a lie of omission is still a lie. Sharing all your financial details with each other can help keep any money problems from deteriorating over time by allowing you to address them as a team.
3. Remaining Vague About Finances
An extension of maintaining financial honesty between couples is providing a detailed account of your finances to each other – not just the particulars of all your debt. It sounds mundane, but providing your other half with a full layout of your tax obligations, banking activities, savings and investments is just as important as knowing the bad stuff. How better to plan out your financial future than to start out knowing everything you have to work with? A personal financial statement can help with this by collecting all your assets and liabilities on to one list that’s easy to understand and share.
4. Neglecting Bills
It can be very easy to put off planning out your financial obligations each month, and that can set you up for needless arguments when the bills come due. If you do not explicitly determine who is taking care of which bills, there’s a good chance you’re not both on the same page about who is responsible for each one – which can be a recipe for disaster. Setting up a joint account to handle bills that each of you contribute to on a consistent basis is a good start to streamlining this process. This allows each individual to have their own money, but also creates a shared stash to pay for things you both contribute to and benefit from. This strikes a nice balance between sharing openly in your relationship, while still giving each partner a little bit of their own space.
5. Failing to Plan
Discussing finances is key to identifying any issues, but you still need to fix the problem at some point. Knowing you have a spouse that overspends doesn’t do you any good if you don’t collaborate on a solution. Laying out a plan to maintain responsible spending habits – like agreeing to avoid impulse buying – will provide a roadmap to navigate the issue. No matter what problems arise, open and honest discussion coupled with the proper actions to achieve a solution can work wonders for any relationship.
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