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According to Fidelity’s Couples and Money study, 45% of partners argue about money at least occasionally, and nearly 1 in 4 couples identify money as their greatest relationship challenge. Here are six common financial issues that stress married couples.
Key Takeaways
- Around one-quarter of all couples say money is their greatest relationship issue.
- Couples can employ various tools and strategies to pay off debt.
- Spouses should communicate their financial priorities around raising children, saving for retirement, and budgeting and spending.
- A financial advisor or planner can provide couples with unbiased advice.
1. Separating Earnings
Sometimes couples split the bills down the middle or allocate them in some other manner that seems fair and equitable. Once the bills have been covered, each spouse can spend what’s left as they see fit. This may cause resentment over the individual purchases made. It also divides spending power, eliminating some of the financial value of marriage.
2. Carrying Old Debts
Many people come into a marriage with student debt, credit card debt, a gambling habit, or something else. Sparks can fly between partners while discussing income, spending, and debt servicing.
Most debts brought into a marriage stay with the person who incurred them and are not extended to a spouse. Your partner’s debt won’t likely hurt your credit rating. In states that operate under community property, debts incurred jointly after marriage are owed by both spouses.
In nine states, all property and debts are shared after marriage regardless of individual or joint account status. These community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. In these community-property states, any debt incurred after the wedding is automatically shared—even when applied for individually.
3. Personality Differences
Even if both partners are debt-free, the age-old conflict between spenders and savers can play out in multiple ways. It is important to know your money personality—as well as that of your partner—and to discuss these differences openly.
Tip
It’s best to recognize bad habits, address them, and moderate them for the relationship.
4. Power Plays
Power plays may occur in one of three scenarios:
- One partner has a paying job, and the other doesn’t
- One spouse earns considerably more than the other
- One partner comes from a wealthy family, and the other doesn’t
When one or more of these situations are present, the spouse who makes or has the most money may try to dictate the couple’s spending priorities.
5. Supporting a Growing Family
Whether and when to have children is a financial decision. Food, clothing, shelter, Little League, ballet, prom gowns, minivans, and college tuition are on the list of child-related expenses.
Having kids isn’t just about the cost. If one partner cuts their hours, works from home, or leaves a career to raise children, couples should address how that changes marriage dynamics, assumptions about retirement, lifestyle, and more.
Up to $513,722
According to U.S. Department of Agriculture data, it may cost between $241,106 to $513,722 to raise a child from birth to age 17.
6. Coping With Extended Family
Sometimes partners help with the costs of their family of origin. His parents need a new car. Her brother can’t make the rent. One spouse is writing a check, and the other wants to know why that money wasn’t used to address needs at home or fund a vacation for “us.”
When a serious crisis arises, such as illness, major storm damage, or an unexpected death, the pressure to help is often magnified.
How To Handle Money Issues
According to Fidelity, effective communication is key to financial success for couples. Those who communicate well are more likely to discuss their finances and anticipate living comfortably in retirement.
- Communicate: Talk openly about your preferences for handling money, your goals for the future, and any concerns you have about how you jointly handle your income. Attitudes about money filter through many aspects of daily life.
- Set financial goals: A couple should agree on their long-term goals and how to get there. Much of that discussion will involve financial matters. Whether your priorities include having children, buying a house, saving toward a comfortable retirement, or all of the above, they should be planned for and agreed upon.
- Deal with debt: For many couples dealing with debt, partners should have an honest, nonjudgmental discussion about the debts they would bring into a marriage. Couples can apply debt payoff strategies, such as paying off the higher-interest debt first (the debt avalanche method) or paying off the smallest loans first (the debt snowball method).
- Sign a prenup or postnup: Couples who are unsure about joint financial matters before marriage may choose a prenuptial agreement. Those who have already said “I do” and want more than vows to protect them may want to create a pain-free postnuptial agreement, also called a marital contract.
- Know thyself: Personality will play a major role in your financial plans. Talking about your views and feelings can help put both partners at ease, or at least let them know what to expect. If you’ve got more cash, be sensitive about how you present spending decisions. Studies have shown that people with more power are more likely to act selfishly, impulsively, and aggressively, and approach others with less empathy.
- Address family matters: Extended family can be a huge challenge, and no advice addresses every situation. When choosing to help a family member or accept financial help from a family member, it helps to have a policy agreed upon in advance.
How Can Couples Pass Good Money Habits to Their Children?
Couples can start teaching children about money when they are young. Preparing them for a financially responsible future reduces the odds that they will dip into your wallet as adults and knock your savings plan off track. Use allowances and goals to teach children about earning, saving, and spending money.
Should a Couple Have Individual or Joint Accounts?
Some experts argue that couples should have joint checking accounts and credit card accounts. As personal finance expert Rachel Cruze points out, the household income and expenses are no longer “his” or “hers,” they’re “ours.” Joint accounts lend themselves to open, transparent spending habits. Separate accounts can lead to secretive and selfish behavior.
What Is Financial Infidelity?
Acts of financial infidelity may include opening a separate bank account that a partner is unaware of. It may be hiding debts or an expensive bad habit. It may be squirreling away a secret stash of cash.
The Bottom Line
Good communication before and after tying the knot can dull the blow of bad financial news and lead to honest exchanges about each partner’s money anxieties, habits, and expectations. Financial anxieties can become far bigger problems with much more difficult solutions. Couples may find it helpful to schedule a time once a month, once a quarter, or once a year to check in on short- and long-term goals. An annual financial plan and regular check-ins can defuse the tension of talking about money and keep you both on track.
