33% of couples say they’re financially incompatible. What can I do to avoid this?

Category: Financial Planning

How often do you talk about money with your partner?

Issues around money can sometimes make or break a couple. Research indicates it causes a lot of struggle. According to a survey from Royal London, 62% of couples in the UK have argued about money. The most common cause is the perception that one of the couple is “spending too much”.

While differences are common in every relationship, a third of couples say they are mismatched with their partner when it comes to money. A quarter see their partner as unreliable with money.

How a couple deals with money now affects their future. Singing from the same hymn sheet is vital, and it not only reduces the chance of rows but increases the chance of achieving financial goals.

Here are seven tips that might help.

1. Talk about money more

Despite money having a vital role in our lives, the research found that couples often find it hard to speak about it. Making money a part of the conversation is a crucial initial step. Sometimes, misunderstandings can occur that being more open can solve.

2. Don’t keep your financial situation to yourself

Being open about debt, expenses, and other aspects of money improves financial decision making. It can also give insights into where differences may lie.

3. Create a joint household budget

Understanding who will be paying for what and when is vital. Some couples may split expenses evenly. If there are significant differences in earnings, a different split might be more suitable.

What is imperative is finding an option that works, which may mean depositing a set amount into a joint account every month or assigning responsibility for different outgoings.

4. Create a discretionary budget

How a partner uses money can be a source of conflict. Setting a budget for non-essential spending can avoid this, and it can create a balance between enjoying life, having enough to cover essential spending, and saving for the future.

5. Set out clear saving and investing goals

With budgets in place, thinking about other goals is a good idea. This could be buying a house, starting a family, going on holiday, or building a financial safety net.

Having clear shared goals can minimise arguments.

6. Don’t overlook long-term goals

The sooner you start looking at things like retirement planning, even if it is a long time away, the easier achieving your goals will be. Where there is a lack of knowledge of who is doing what, it can be challenging to know what needs doing. Knowing who is paying what into pensions would be an example.

7. Work with a financial planner

Doing all of the above can be a challenge. Financial planning can bring the various elements of money into focus. From discussing what your long-term goals are to reviewing protection needs. Having a financial plan can build a balance between living for now and saving for the future and can help ensure all parties are aware of what is going on.

If you would like to talk about how financial planning can help you, feel free to book a free no-obligation chat here.


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