Whether you and your partner are newlyweds or celebrating your silver wedding anniversary, one of the best things you can do for the health and strength of your partnership is build wealth together. That doesn’t happen overnight. But it does happen if you make clear, systematic plans to achieve financial goals together. Goals both small and large.
Here are some tips for how to focus your financial conversations and actions so you can succeed financially, together.
1. Agree on Long-Term Financial Goals to Build Wealth
Managing money is something that happens both in the short- and the long-term. But a guaranteed way to get better at managing money in the short term is to think about what, exactly, it is you want your money to do for you in the long-term. Do you and your partner want to retire early and travel? Are you hoping to send all your children to college? Do you want to become completely debt-free — no mortgage, no credit card debt — so you can experience true financial freedom?
Make sure the two of you take the time to talk about your hopes and dreams for what you want your money to do for you. Keeping those goals front and center will make the work of sticking to a budget and setting aside savings so much easier.
2. Make (and Keep) Regular Money Dates
Sounds so sexy, right? Okay, maybe it sounds like the opposite of sexy but stay with this idea for a second. Is money stress sexy? No. Is worrying about paying bills sexy? Definitely not. Is trusting that you’ve made financial plans that put you on a path to future wealth sexy? Maybe not. But you know what? The absence of financial worry makes room for the fun times and togetherness that every couple needs to stay connected and close. Get it? Okay, then.
So what’s a money date? Money dates are a way to keep your financial planning – both short- and long-term — front and center in your relationship in a way that’s productive. So rather than waiting until things feel tight and stressful to have a conversation, you are instead just having regular check-ins to do the following:
- confirm that the plans you have in place for paying bills and saving for the future are working as planned
- flag any potential issues or talk about any “surprise” expenses and discuss how to handle them
- make sure you have enough money in your emergency fund to handle those expenses and make a plan to replenish that fund if you have to use it
Just a half hour twice a month, or even just once a month, can keep you on the same page and also keep the two of you focused on securing a safe and well-financed future together.
3. Have “Your” Money and “Our” Money
Now that you are aligned both on long-term goals and how to manage your money and pay your bills in the short term (those money dates!), you can trust that the two of you are on the same page financially. So now is the time you can consider: what money is “my” money and what money is “our” money? Research shows that there is no one right way for couples to share money: all separate accounts, all shared accounts, some shared and some separate. Doesn’t matter. What matters is that each partner has the ability to spend some money however they choose, without oversight from the other partner. This way you both have some financial freedom within the confines of the rules you’ve made and the goals you’ve set. That little bit of private dough helps keep both of you committed to the big picture.
4. Challenge Each Other to Spend Less to Build Wealth
If laying out your budget together shows that you are tight on funds, then look at where you spend, together, and see if you can make a game out of it. How much less can each of you spend on, say, groceries? Or gas? Eating out? Lunches at work? If you use a shared budgeting app, like Honeydue or YNAB (short for You Need a Budget), you can even see the expenses and comment on them in the app.
Always keeping your eye on the long-term goals you share will help make these kinds of expense challenges more do-able.
5. Beat Your Credit Card Debt
If you are struggling with credit card debt — especially if credit card debt is making creating a monthly budget difficult — you should make erasing that debt your top priority. (Caveat: attack the debt once you have set aside a couple hundred dollars for emergency expenditures that inevitably arise in life. You don’t want an unexpected expense to knock you off your debt repayment strategy!)
As with all things financial, making a plan is what works. Regardless of whether the debt belongs to one of you or both of you, remember that the debt impacts your long-term finances as a couple. So you should solve for it as a couple. First, sit down and get lean and mean with your budget: figure out how much more money you can direct toward your credit cards each month. (Streaming service may currently feel like a “must-have” but “being out of debt” is the best must-have of them all.) Choose the snowball or avalanche methods to decide which debt to erase first. Then systematically go through them until you’re done. Then: exhale. And celebrate!! (Inexpensively, please.) Now the two of you have cleared the way to plan for a financially stable and secure life. And you can start again at Item #1 above.
However, if you are really struggling to manage your credit card debt, and feel overwhelmed, or if you are suffering a financial hardship, you should consider reaching out for professional advice. A debt consolidation loan is sometimes a good solution, allowing you to pay off all your high-interest credit cards with a lower-interest loan, which both helps your credit score and lowers the amount of money you’re paying each month.
Want to know more? Contact White Mountain Partners, a known debt-consolidation loan financial firm. Their financial consultants can look at your numbers and let you know in just a few minutes whether a debt consolidation loan is right for you. And once your credit card debt is behind you, you and your partner can make plans to build wealth together and achieve your long-term financial goals. Start today!