Even the closest couples will agree that it is impossible to agree with each other all the time. And that’s what makes relationships special. Each person brings his or her own perspectives to the table. And if the relationship is a deep and mature one, both the individuals learn to move outside their own convictions and accommodate the other’s point of view on things like family, lifestyles, expectations, and of course, the big one: money.
Money can often be a long-standing cause of disagreement between couples. Money management is a deeply personal trait, like driving. Most of us assume that we know exactly how to spend and save. Hence, when a significant other criticises our financial habits, it can often lead to furious rows.
Like with any other disagreement between a couple, it is important to sit down and talk about money. Here’s how to approach that discussion with your significant other.
1 Ensure that money management is a shared responsibility: A relationship is a two-way street, and the sooner you and your partner understand that, the better life gets. Just like other responsibilities, financial matters should be divided equally among partners. It’s unfair to expect one person to bear the entire financial burden of the relationship. The best way to ensure a comfortable and a mutually respectful relationship is to ensure that both partners contribute as equally and fairly as their finances allow them.
2 Understand each other’s goals and perspectives: Every individual is different and thus, what’s important to one person might not be important to another. The same logic applies to a relationship, and that’s why it’s important to understand and acknowledge each other’s goals and perspectives. What’s your spouse or partner’s five-year plan? How important is buying that additional Smart TV? These may seem like silly questions, but they hold the key to understanding each other’s long-term goals.
3 Agree on how much to save and spend every month: Irrespective of who’s bringing in how much money, it’s important to agree on some spending and saving limits. Discuss with each other to arrive at a figure that you are comfortable with. If for some reason you can’t stick to the plan during a particular month, make sure you inform your partner about it.
4 Be open and transparent about all financial matters: Decisions like opening a joint savings account are important, so make sure you talk about it openly and clearly with your partner. If you would rather have separate accounts, always keep your partner in the loop in terms of your financial status.
5 Talk to an investment expert jointly: This will help you understand each other’s perspectives, choices and risk appetite and find common ground. It also creates a joint sense of responsibility, and allows facts and figures to dictate the conversation, rather than emotions.
Couples who agree on household finances are more likely to be satisfied overall with their relationship. The key phrase to remember here is ‘joint goal-setting’. It is important for two people to have a shared financial vision for their future and work towards achieving it. Mutual funds are a great tool for goal-based investing, as they allow users to select a time-frame, investment volume, and risk level that they are comfortable with. For more information on mutual funds and their benefits, check out the recent ‘Mutual Funds Sahi Hai’ campaign by The Association of Mutual Funds in India (AMFI) at www.mutualfundssahihai.com .