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How to Discuss Finances with Your Partner Without Killing Each Other

How to Discuss Finances with Your Partner Without Killing Each Other

Money is often cited as the number one topic that couples fight about. This can be incredibly trying, especially when you and your significant other have different views about the ways that your money should be saved and spent. Listed below are a few ways that you can talk openly and honestly about money in your relationship, but of course, no two relationships are the same, so you might have to try several of these tactics in order to find the one that works best for you.

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    Understand Their Background

    Instead of fighting about money, first try to understand how your significant other grew up. Were they raised in a home where they were taught to pinch pennies? Or, were they raised in a home where they were able to buy whatever they wanted? Often, people have difficulty leaving their personal upbringing behind when it comes to creating their own way of managing money. We often mimic the money management systems that our parents use, which might not work when we bring another person into our lives. Understanding why they are the way that they are in terms of finances can help open the door for some clear conversations.

    Establish Trust

    Establishing trust is one of the most important things a couple can try to do when they are managing their money. This can be difficult since many people might wish to buy extravagant things without telling their partners, thus breaking their trust. At first, you might have to resort to only using cash and writing down what you spend, but you should be able to rebuild that trust eventually and communicating within the relationship will become easier.

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    Have a Common Goal

    We should all have some idea of the money we want to save and financial goals we want to achieve, be that taking a trip, paying off credit card debt, or something entirely unique . If you and your partner share the same goal (like a romantic vacation), working together to save the money for it can put a positive spin on managing money.

    Talk To a Financial Counselor

    There are many financial counselors who also specialize in helping relationships: you just need to do an Internet search to find one who can help you plan for your future and understand your partner’s goals and habits as well. Going to talk to a financial counselor can definitely be an intimidating experience, but people often feel so much better after they do, since financial counselors can give you realistic numbers of the amount of money you should be saving and spending. You’ll leave feeling informed, organized, and rejuvenated.

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    Have “Fun Money” Accounts

    Most of the arguments that couples have about finances are in regard to how each person should be spending money—most often, with one partner getting mad or upset that the other has purchased something they shouldn’t have. This can be avoided if each person has a specified amount of money that they can spend on whatever they like. If they want to save for a few months and buy an iPad, they can do that; if they want to spend it all right away on a hundred packs of M&Ms, they can do that too. The important thing is that each person can decide what to do with his or her own “fun money”—this establishes trust and allows each person to get what he or she wants (within reason).

    Manage it Together

    If you find that you and your partner consistently argue about money, it’s time to get organized. Sit down together once a week for a budget meeting so each person is fully aware of how much each other has, and what needs to be done each week to keep your budget in check. This type of meeting can really keep the lines of communication open and encourage each of you to stay accountable for the amount of money you spend.

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    Track Your Money

    Getting into the habit of writing down everything you buy will help you to be aware of your spending patterns, and so much more. Pretty soon, you will consider each purchase and ask yourself if you want to write it down—this keeps you from spending needlessly. If both you and your partner get into this habit, you can be well on your way to attaining financial freedom and having fewer arguments about money.

    The tips and techniques above are not for everyone, and I’m not a relationship expert. I do know from experience, however, that utilizing at least one of them can help your relationship to be more open, honest, and understanding. Every relationship has trying times now and then, and these tips can help you to avoid some of the tensions that can arise when you disagree about money.

     

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    Published on September 17, 2018

    How Being Smart With Your Money Leads to Financial Success

    How Being Smart With Your Money Leads to Financial Success

    Achieving financial success is not something that just happens. Maybe if you win the lottery or something, but for the average person like you or me, it comes from a series of small steps you take over a long period of time.

    With each step, you form a new smart money habit. And with each smart money habit, you build towards financial independence.

    So what sort of habits can you form to get on that path? Let’s take a look at smart money habits you can start today to get you closer to a financially independent future.

    1. Avoid being “penny wise but pound foolish”

    It’s tempting to try saving a couple cents here and there when buying small items. However, that’s not where the real money is saved. You’re putting in extra effort for something that doesn’t move the needle.

    You get the most bang when you’re able to cut down on your bigger bills. For example, finding a lower interest rate for your mortgage could save you $50+ per month. And cutting your transportation bill by purchasing a cheaper car or taking public transportation can provide large gains as well.

    So, look at your recurring expenses such as housing, transportation, and insurance, and see where there’s wiggle room. It’s a much better use of your time than trying to pinch pennies here and there on smaller purchases.

    2. When you want something big, wait

    Impulsivity can get you in trouble in most aspects of life. Finances are no different.

    It’s human nature to see something and want it right then and there. It starts as a kid in the checkout line at the grocery store, and it continues on through adulthood.

    We get an idea in our head of something we want, and it’s hard not to go out and get it right then.

    A good example is wanting a new car. Perhaps you’ve had your car for several years. It’s crossed the 100k mile mark. Maybe maintenance is due, and you’re annoyed that you need to replace the timing belt or purchase new tires.

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    So, you get the itch.

    You start digging around online, and you realize you could trade in your current car for something newer and more exciting… all for a few hundred bucks a month. Then you get obsessed.

    Here’s where you have to take a step back.

    Your newfound obsession is clouding your judgement. Rather than giving into the impulse, wait it out.

    Set a timeframe for yourself. Maybe you come back to the decision three months down the road. See if the obsession lasts.

    It might, but often, a funny thing happens. Often, you forget about it. And often, you find that the new car wasn’t a need at all.

    The impulse faded. And you just saved yourself a ton of money.

    3. Live smaller than you can afford

    You finally get that big raise. And you want to celebrate – and why not?

    You’ve been looking forward to this forever. And after all, it was all due to your hard work.

    That’s fine, splurge a little. However, make it a one-time deal and be done.

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    Don’t get caught in the trap that just because you’re now making more money, you should spend more.

    Too often, people get more money and feel like they that gives them the means to buy a bigger house, a bigger car… you know the drill. Resist.

    The fact is that living smaller than what you can afford is one of the fastest ways to build savings.

    But if you constantly upgrade as you begin to make more, then you’ll never get ahead. You’ll just build up more debt along the way and have just as little wiggle room as before.

    4. Practice smart grocery shopping

    Food… it’s one of the biggest portions of any budget. And if you’re not careful, it can be one of the biggest drains on your wallet.

    But luckily, there are a few things you can do to ensure that you stay smart with your money when buying groceries.

    Create a grocery budget

    Set a strict weekly grocery budget. When you know how much you can spend on groceries, you can then plan your weekly menu around it.

    Once you know what all you need, you can go shopping and keep a running tally as you shop to ensure you’re on track.

    I tend to do this in my head, rounding for each item. However, writing it down as you go would probably work best for most people.

    Make a list… and never deviate

    Never go to the grocery store without a list. If you go to the store with a ballpark idea in mind, you don’t have a true ide of what you need.

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    You’re not well-researched. You don’t know what the sales are. As a result, you’re going to make decisions on the fly.

    These impulse decisions will lead to overspending, which will derail your grocery budget.

    Eat before going grocery shopping

    It’s also important to eat prior to going to the grocery store. Hunger is a powerful force.

    If you’re shopping on an empty stomach, everything is going to look good. In particular, you may find a lot of ready-made, processed snacks will look enticing.

    After all, you’re hungry now and that food is easily available. So subconsciously, you may lean towards those items.

    Unfortunately, not only are those items typically less healthy, but they’re likely more expensive. You pay for convenience.

    However, when you eat prior to shopping, then you’ll shop with a clear mind. Your hunger won’t cloud your judgement, influencing you to make poor decisions like a cartoon devil resting on your shoulder whispering in your ear.

    This makes it much easier to stick to your grocery plan.

    5. Cancel your gym membership

    Now that you’re all set on your food, it’s time to get smart about managing your budget in terms of physical fitness. And let’s begin by avoiding the gym. The gym bill, that is.

    The average gym membership costs around $60 per month. That’s $720 a year.

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    Yet, two out of three gym memberships go unused. That means two-thirds of people who have a gym membership are literally giving away almost a thousand bucks a year. It’s crazy!

    I recommend seeking an alternative. One good alternative is to look into fitness streaming services.

    Streaming services allow you to stream hundreds of workouts like Insanity and p90x, right in your own home for around $10-20 a month. That’s $40-50 less a month than the average gym membership.

    Of course, then there’s the free option. The internet is full of free workouts that you can do on your own with minimal or no equipment.

    For example, there’s the Couch to 5K program, that I personally used a decade ago to ease myself from couch potato to running my first 5K race. If I could do it, anyone could.

    Then there are free resources like reddit that have limitless information on workouts. The Fitness subreddit has done all the research for you, populating workout tips and detailed workout routines for anyone to use in their wiki.

    There are several routines that require no equipment. And you can join in on the subreddit to become part of the community, making it easier for those seeking comraderie and encouragement in their fitness goals. All for free.

    It’s baby steps… And baby steps can start now!

    I’ve never met anyone that can’t stand to be a bit smarter with their money. And on the flip side, anyone can get smarter with their money. But remember, it doesn’t happen all at once.

    Begin by fighting your impulses. Prepare for the week and be smart at the store. And cut monthly expenses like gym memberships that are overpriced and you probably aren’t getting your money’s worth out of anyway.

    The devil is in the details. And the details can change your lifestyle and prep you for a financially independent future.

    Featured photo credit: Unsplash via unsplash.com

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