What true loves share without losing each other

As February is the month of love, it is fitting to consider how to keep it alive by avoiding one of the leading sources of conflict and breakdown in relationships: money.

When you start dating someone, your money habits and personal finances are not usually the first thing you want to discuss. As things get more serious and you have been together for a while, the prospect of spending your lives together becomes more real and can lead to more serious conversations, including those about your visions for the future.

You must discuss what you want to achieve together in future, such as building a career or a business, getting married, having kids, buying a home, and so on. Each of these major life decisions have financial implications for which you need to make provision.

How resentment grows

When couples are not on the same page in terms of the goals they want to achieve and how they should spend their money to achieve those goals, it can lead to anger, resentment and conflict.

It is important for each partner to clearly understand their significant others’ goals, preferences, money habits and personal balance sheet.

And you need to establish and maintain trust in each other. This means there needs to be full transparency. You need to face your financial situation and what you need to do to improve it warts and all.

A nasty surprise, such as severe debt, that you have kept hidden from your partner for a long time could be the death knell of your relationship.

Setting your money principles

By discussing money with each other, you can establish important money principles for your relationship. For example:

• We save and invest first and we then we live off the rest.
• We budget and we track our spending each month.
• We never spend more than our means.
• We do not take any debt except for big purchases, such as for a house or a car, and we put down the biggest deposit possible, finance it on the shortest term possible and with no balloon payments.
• We meet as a couple to discuss money once a week and with our financial planner at least twice a year.

Engaging with a financial planner can also help you, as a couple, focus and organise your goals. A planner with help you quantify your goals, weigh up different priorities and trade-offs and help you to put in place an actionable strategy that you are both happy with and committed to.

Some couples prefer to have their own financial planners and to manage their money separately. This can work, provided there is full transparency and that your shared money principles are respected.

Yours, mine and ours

While it is important for couples to provide for goals and expenses and even fun things such as entertainment together, it is also important that you provide for your individual goals.  

Each partner in a couple should have some money each month and each year to spend as they wish without having to ask the other partner for permission.

If you do this you take significant steps towards achieving your joint goals, but also ensure your individual dreams are achieved and you each maintain some individual autonomy.

Aligning your money personality

When it comes to your money personalities, there are two extremes: Some people are spenders and some are defenders.

Spenders want to live life to the fullest. They spend freely now and forgo the future.

Defenders want to make sure that their future is secure first. They want to save and invest as much as possible now, living frugally to ensure a bright future.

These two money personality types are incompatible and without working together and reaching a compromise it is unlikely that a relationship between a spender and a defender will last.

You need to strike a balance between providing adequately for the future through savings and investments and having fun and enjoying your money.

Red and green flags

Red flags when it comes to money and your relationship are a lack of transparency, the failure to recognise and provide for one or both partners’ individual needs and goals and an unwillingness to compromise from either side.

If after significant effort you are unable to reconcile your money differences, it may be better to move on. Staying together could be deeply frustrating and ultimately disastrous.

But don’t give up before you have conversations and make the effort to find common ground when it comes to your money. That can lead to a deeply satisfying long-term relationship in which you are committed to and supportive of each other.