When you look at the issues that cause strife in relationships, money is often at the top of the list. Even when a couple isn’t struggling financially, there can be big disagreements on everything from spending to investing to managing debt. Here are four key steps to building a more harmonious financial life with your partner:
1. Rather than splitting financial chores 50-50, just be crystal clear on who does what.
In one study, California researchers videotaped an entire week in the lives of 32 dual-income, middle-class families with children, monitoring their stress levels throughout the day. Even though the couples said their goal was to share tasks equally, researchers found no correlation between a 50-50 chore split and marital satisfaction.
What did matter to happiness? Well-defined expectations. In other words, it’s not the way chores are split that matters, but how clear the roles are, and how much autonomy each person has in doing their job. The more ambiguous the responsibilities, the more negotiation, repeated demands, nagging and tension within the family, noted Wendy Klein, associate professor at California State University at Long Beach.
“For example, if the husband is doing dishes and the wife comes up and says, ‘that’s not the way I would do it, look at the mess you made’—those kinds of comments display a lack of respect, and definitely had a strong effect on the level of stress spouses were experiencing,” said Klein.
2. Agree on goals, then divide the work.
Decide on your big goals first, such as buying a home, saving an emergency fund, investing for college or retirement or getting out of debt. Agree on a monthly budget, and how much risk you are both comfortable taking in investing. Then have one person oversee day-to-day money management, and the other manage long-term asset planning.
What did matter to happiness? Well-defined expectations.
Couples in the study who had an uneven division of labor got along well because the partners who did less were actively engaged and willing to jump in and help out when needed. When they did step up, their partners expressed appreciation without monitoring, interfering or critiquing the way they performed the task. So, if your partner asks for your input in spending, saving or investing, give your view without criticizing their approach.
3. Recognize that those who divide and conquer do better.
Photo by Dean Drobot/Shutterstock.com
There’s another reason to divide and conquer financial chores: Couples who do save more. A study by MIT AgeLab and The Hartford Insurance Company interviewed about 1,200 people between age 45 and 74. They identified different money styles among couples:
- “drivers,” in which one partner dominates financial tasks;
- “passengers,” who are either minimally involved or totally hands off;
- “joined at the hips,” couples who make every decision together, with no clear separation of duties; and
- “divide and conquer,” in which each partner takes the responsibility for a key financial chore.
Among the “divide and conquer” couples, 38 percent had saved $750,000 or more for retirement, compared with 17 percent of the “drivers” and 16 percent of couples who collaborated but didn’t have defined roles.
The “divide and conquer” couples were also more likely to report they were enjoying retirement, and more apt to have a financial plan in place for a surviving spouse in case of death. “I suspect it’s both members of the couple that may be working and generating income, and both have the opportunity to save through an employer’s retirement plan,” D’Ambrosia said. “They have better knowledge of what’s going on with their finances because both people are bringing in a paycheck.”
4. Stay in the loop.
Finally, it’s okay if your partner handles most of the financial tasks. Just stay educated and in the loop in the event of death, disability or divorce. “I talked to a group of widows on topics of financial management and one said after her husband died, she didn’t know how to balance the checkbook,” said Lisa D’Ambrosio, research scientist at MIT AgeLab. “She had no idea what to do because she hadn’t taken any responsibility for it.”
Anecdotally D’Ambrosio has found widows will sometimes liquidate their assets, resulting in losses, because cash is the only investment they understand.
Bottom line: Meet once a month in a relaxed environment (not while paying bills!) to discuss your financial progress, and be sure to respect and appreciate the work of your partner.