5 Moves Every Couple Should Make

By Melanie Vu

 

An exclusive survey on love and money shows that how you handle your finances affects how happy you are in your marriage.  Following these 5 moves may improve your financial compatibility.

1.       Get Financially Naked with each other – lay it all out on the table. Financial transparency will set a solid foundation for your relationship, whether you are dating, about to get married, or already married. Knowing your significant other’s savings, debt and goals will give you a good idea about how they handle their finances. If you and your significant other aren’t already open about finances, don’t rush them into it.  To avoid coming off as confrontational, wait until the mood is happy and plan to make lists together. Make a list of assets and liabilities and monthly expenses together, as well as setting individual and mutual goals.

2.       If you haven’t already discussed retirement yet, start by creating a vision plan. Write down what age you want to retire, where you want to retire, what activities you would like to do together in retirement. See how much you have each saved for retirement and how much you will need in order to achieve retirement success.

3.       Tackle the biggest source of tension – If you and your partner are on opposite ends of the spectrum when it comes to spending and saving, meet halfway. Many couples hide purchases from their partner to avoid conflict. Make lists of what each of you have spent for the month and decide together what is necessary and what is excessive. Make compromises that both partners can agree with.

4.        Handling Debt – debt can be one of the biggest silent killers of a relationship. Credit card debt and student loans impact a person’s self-confidence, also making it harder to save for specific goals.  If you create a plan together to pay off debt and review your progress periodically, you will both feel accomplished and be more motivated to continue paying it down.

5.       Keep Tiny Tiffs from Escalating – Practicing all of these steps doesn’t guarantee that you and your partner will always agree and find a solution. The important thing is how you handle your disagreements. When you do argue about money, don’t wait too long after you cool down to have another discussion. Relationships are give and take; don’t let money rule your relationship.

 

This content was adapted from Time Money’s article “Five Money Moves Every Couple Should Make.”

Written by Dan Kadlec with Kerri Anne Renzulli.

To read the full article, click here.

Who Is Your Go-To Person For Financial Advice?

Presented by Nick Bautista 

Have you ever thought about the people in your life who you turn to for financial advice? Think about that for a minute. When you have a financial question, who do you call or text, and why? Is it because you perceive them to be smart, or wiser than you? Or is it simply because you believe they have the experience to handle your similar situation.

Whatever and whoever you listen to when making your financial decisions, there is one thing you should know. It goes back to the old saying you used to hear when you were a kid. “If Johnny were to jump off a bridge would you do jump too?” Although a ridiculous analogy for following what others do, the message is clear. Why do we blindly follow the advice from someone who doesn't necessarily know or understand our financial situation?

Okay maybe this doesn't hit too close to home or is just too simplistic. So instead, think of the first person you would ask if you had/needed medical attention, a gaping wound, would your parents or best friend know if you needed stitches and be able to do it right then if you did need them. Of course not, you would go see a doctor immediately. So why is it that in our financial need we turn to those who do not understand our situation?

Everyone agrees that finances are extremely important yet we automatically assume those around us with little or no experience can help us with our questions. No one financial situation is the same. Let me repeat that so it sinks in, no one financial situation is the same. Just ask any doctor and they will tell you how no one patient is exactly the same.  

So again I ask who do you ask for financial advice? How much experience do they really have and is it the exact same or similar situation you are in? If the answer is yes, then think one step further. Does your financial friend know if you should do a Roth Conversion or how much you should defer in 401k contributions to save on taxes now? Do they know how much you can contribute to your retirement in a given year based on your retirement plan? Do they understand the history of the stock market or the correlation between asset classes in a given time period, knowing what your allocation should be based on your age and amount saved already? Do they know your goals, and what the money is needed for in order to invest it in a suitable place? Do they know the effect on your retirement plan for buying that car or house you are thinking about?

If your answer is no to any of the above you are getting poor advice and ultimately the wrong answer. While your wound may be okay without stitches you don’t want to find out 30 years later you really needed them, or more importantly you were given the wrong financial advice and your retirement plan is now underfunded to meet your goals.