How to talk about money with your partner

Money difficulties are a leading cause of divorce and that does not really surprise me. Thinking about my own relationship and how many issues money caused in the early days has made me realise that you need to be on the same wavelength as your partner when it comes to finance if you want the relationship to succeed.

Recently to mark the new year I had a ‘Budget Date’ with my partner to ensure we were both on the same page for our finances for this year. We both sat down and looked at our income individually as well as our expenses, to work out how much we could both save each week. We also decided on a joint savings goal that we should hopefully hit by the end of 2022. (unless some unforeseen large expenses which are always possible) I found this budget date extremely useful as it put on paper the differences in our expenses, income, and gave us both a realistic saving target amount per week.

I have been with my girlfriend for nearly four years and we have lived together for the past 8 months. In that time I have witnessed a complete change in her financial habits (at my persistent request) so it has proven to me that just because your partner is not great with money does not mean that they can’t turn their bad habits around. They might just need your help and guidance to get where they want to go.

I will take you back to when I first started dating Anna*. She is a few years older than me and working as a full-time high school teacher. High school teachers earn good money in Australia. She was making about 80K per year and she told me that she had less than $3000 in the bank at the age of 27. I was shocked. How could this woman who had been working full time since university earning that type of salary have no savings? Fast forward a few years and I knew why. She had extremely bad spending habits that she didn’t even realise. She would get uber eats 3-4 times per week, catch ubers home from work if she didn’t feel like catching the $3 train, and many other countless things that a frugal person would deem to be wasting money on.

Early on in the relationship, I did not feel it was my place to try and alter her spending habits. But as we developed into more serious territory, I realised that I had to do something. I genuinely felt I could not have a long-term relationship with someone who had such poor financial habits when I am so dedicated to saving money. I needed her to change in order for our relationship to feel secure. So I did what any lesbian would do and I told her “it’s me or the spending”… Well not exactly in those words. But I did have a frank discussion about financial goals and she agreed. The fact was that she also wanted to save money for a house deposit but she just didn’t really know how to. Bad habits are hard to break but certainly not impossible. So together we worked out a savings plan and she saved 20K in the space of about 14-15 months. This allowed her to put a deposit down on a 2 bedroom unit (that we now both live in, while my property is rented) and she has not looked back. She still follows the savings plan, pays the mortgage, and now has 20K sitting in her offset account. To say that I am proud of her is a complete understatement.

There were many changes that we had to implement to get her to this position. She had to set up automatic transfers into a savings account and cut out most discretionary spending. Ubereats were banned in our household. I ensure that the rent that I pay to her only gets paid into her savings account. But mostly it was about her mindset changing. In the beginning, she was reluctant to show me where her money was going and her attitude was slightly defeatist. “Maddy I have so many bills that is why it is so hard for me to save” she would say to me. But the truth was, the $300 per week she managed to save over the course of that 14-15 months was accessible to her ever since she started full-time work, once she chose to change her mindset and spending habits. Now that she is in a much better financial position with savings and her own property we are continuing down this financial journey together. Whilst we don’t have joint finances or a joint bank account yet we are a team. We have shared savings goals that we both hope to achieve in 2022 and big joint expenses that will be in our not too distant future. Discussing money with your partner does not have to be taboo. It does not even need to be delicate, it just needs to be honest and respectful.

Things to do

• Have a budget date where you note down each of your expenses, income & target saving amount. (They may be vastly different depending on your respective situation.
• Plan out your financial goals. These can be short term, mid term , long term and individual as well as a couple. Having something tangible to work toward can help motivate you to stick to the plan. Especially if your partner is someone who is not in the habit of saving money.
• Discuss debt with your partner. If either of you have any form of debt it is best to be honest. Working together to formulate a time line and plan to elimate the debt should be an essential part of your money discussion. This is especially important if either of your have consumer debt like a credit card or personal loan. Paying this off needs to be at the top of your list of financial goals.
• Sort out who pays for what relative to income percentage. In my case, my partner and I earn very similiar salaries so we do tend to go 50/50 on most household expenses. However if you are in a situation where one person earns substantially more than the other, then it is probably more equitable to split expenses in a percentage based approach. For example if you earn 100K per year but your partner earns 50K then you might work on the basis that the higher earner will be contributing a higher amount to the household costs. Everyone is different and has different opinions so that is why you need to have these discussions to work out what is best for you and your partner.

If you are in a relationship with someone who is on a completely different wavelength to you when it comes to money don’t be afraid to have that discussion. You might be surprised at the small changes that you can help them implement in order to get them on the right financial path. I will never expect Anna* to be as strict with her money as I am but that is okay. Sometimes there is a reason that opposites attract and your partner may never save as much as you do no matter what plan you both implement. However, with your support and encouragement, you may just find that as a team you are still able to achieve your financial goals.