Managing Money in a Relationship
Financial issues lead to friction and arguments in relationships. Arguments about financial issues are the 3rd most cited reason for divorce after basic incompatibility and infidelity. Learn how to handle money, so there is one less stress in your life.
Managing your own financial situation can be a challenge but when you add a new partner into the mix it can become a battle of wills that turns good relationships into a war zone. Many couples spend a lot of time planning their wedding but very little time on planning the marriage. There are no winners when financial disagreements causes a relationship to end or erode, so managing the financial aspects of relationships early on is an important part of financial planning.
So how do you stop money wars in a new relationship? The first step is to make sure that your own money management views are built on solid ground. Only then can you figure out how to integrate someone else’s finances into your lifestyle. While it’s important to find common ground, share expenses and budget, you also need to keep some aspects of your finances separate. For example you should not share a bank account because in the event of one of you dying the bank account may be frozen leaving you with no access to cash.
You should both make a monthly savings commitment and have at least a basic idea of what you want to achieve by the time wrinkles and grey hair have caught up with you. Have a definite blue print for your future and set a time limit on when you want to be financially independent. To do this you need to identify the lifestyle you want to achieve how much it will take to get there. Don’t forget to look at risk cover like life insurance, income protection and medical cover, this really matters when building a solid financial strategy.
If you are not yet married, don’t buy anything that costs over R1000 jointly or buy things that cannot easily be divided if the relationship ends. This includes cats, cars, furniture and homes, especially homes. You may be able to agree on who gets the fridge and the toaster but trying to sell a house when the owners lock horns could be messy. There is plenty of time to join resources if you decide to seriously commit to one another down the road. Having to sell a house after a short period of ownership will often result in a financial loss for all concerned.
Money issues are the leading cause of divorce, keeping money argument’s at bay is a challenge but good planning, a little negotiating and a lot of patience will keep the peace and beat the odds.
Source: Hollard Insurance