At Deerfield, we help our clients build comprehensive financial plans. That doesn’t just mean we help you plan for your investments, or create a savings strategy. We focus on more than just the dollars and cents of your plan because your financial life is impacted by so much bigger than just your finances! One way we help our clients is by guiding them through how to navigate financial goals in their relationship.
The truth is, it’s pretty rare to find someone who is 100% financially compatible with you. We all have our own background with money. Our experiences and the way we were raised impact how we use money in our own lives, and nobody’s financial history is identical. Still, just because you and your partner don’t always see eye to eye doesn’t mean that you can’t set financial goals and work toward them as a team successfully.
Why Do People Spend?
In every relationship, there’s usually a spender and a saver. Before you judge how much (or how little) your partner spends money, it’s important to understand why they spend the way they do. Here are a few common reasons that motivate people to spend their wealth:
- They feel like they’re supposed to.
- It’s what their parents did (or didn’t do).
- They want freedom – and spending gives them some sense of freedom that they’re looking for.
Knowing Your Approach to Money
Once you have a grasp on why you and your partner are motivated to spend money, you can start to determine how each of you views money in your life. Typically, people view money in three different ways:
- Money is an opportunity. People who view money as an opportunity are often excited about their finances. They may also fall into the trap of overspending.
- Money is a vulnerability. People who look at money as a vulnerability often make fear-based decisions. They’re always thinking “what if” – and a financial plan can help them to find peace when it comes to their finances.
- Money is security. People who view money as security are often risk-avoidant. They can be hoarders and tend to be the more financially rational person in a relationship.
You and your spouse may view money in different ways, and the way you each view money will impact how you think it’s “okay” to spend it. The truth is that there’s no wrong answer when it comes to how you create your financial plan. The important thing is to coordinate your goals, and to find a balance between each of your money-viewpoints.
What Happens if You Have Opposite Values?
My wife and I have opposite money view-points. Personally, I see money as an opportunity. It’s a tool to be leveraged for experiences, freedoms, and more. Because of this, I’m more comfortable spending our money on experiences and opportunities. My wife, on the other hand, views money as security. She finds comfort in knowing that we have savings goals that we regularly reach and that we’re always planning ahead to cover all of our bases. She’s often not as comfortable with big expenses as I am, because they have the potential to take away from our family’s security.
Many times, these sort of opposing money viewpoints lead to arguments in a relationship. This makes sense because money is often a highly sensitive topic. But, when the two of you work together, you can come up with a plan that balances both of your views on money and leaves you both feeling fulfilled.
Working Out a Plan Together
Your first step is to know your goals as a couple. I don’t just mean what immediate goals you have for your future (like taking an amazing trip this summer, or having 3 months of expenses in an emergency savings account). When you two put your heads together, what role do you want money to play in your life?
My wife and I have different views on money. However, we both agree that we want our money to be spent on experiences – not things. So, when we budget, a bigger portion of our monthly cash flow goes toward experiences for our family to enjoy together. Similarly, we know that we’re passionate about charitable giving and using our money to make an impact. That’s why a portion of our cash flow is dedicated to a charitable giving strategy, as well.
Our different financial backgrounds and approaches to money are reconciled because we’re on the same page when it comes to how we want our money to be spent. We set goals together, and work to create a plan that accounts for what we both want.
Bring in a Third Party Mediator
Sometimes, navigating spending in your relationship isn’t easy to do. Working with a fee-only financial planner can help. They act as a third-party mediator to help you balance risk with opportunity, and align your financial goals. Want to learn more? Schedule a call with us today. Our team would be happy to help you determine whether a financial planner can help you and your spouse or partner create a plan that works for both of you.