Money may not be romantic, and ‘when it comes to passion killers it is probably on a par with big pants,' write Karen Pine and Simonne Gnessen in Sheconomics (www.landmarkonthenet.com). However, if your relationship has reached a point where your toothbrushes are cohabiting and your plans extend beyond next weekend, you just can't ignore finance, they urge.
So many of us are scared to bare all when it comes to money, but financial intimacy does not mean exposing all your money secrets to another person, the authors explain. To those who think that it is better to turn the light off and not mention it, to be secretive about your earnings and what you owe, and to remain cagey about what you can and cannot afford, the book has guidance on how to get up close and financially personal with yourself and your loved ones.
What are the advantages of sharing financial intimacies? Many, as the authors list: One, you can be comfortable talking to others about money; two, you will be able to plan towards future goals with a partner; three, you can be confident enough to raise any money issues with your friends or partner without getting emotionally charged; four, you will be respectful of your own needs and financial limitations and not be led by others…
The M word
Interestingly, it is never too early to mention the M word, even on a first date! You may detest the idea, but there are money moments even on the first meeting, such as who is going to pay, the authors note. They cite the findings of a National Savings survey (2008) in the UK – that 40 per cent of men expect to pick up the bill on a date.
Perhaps, they are reaching for their wallets from chivalry rather than women's expectations, because in fact only 17 per cent of women expected the man to pay. That does not mean men are not looking for a return on their investment, caution Pine and Gnessen. “Nearly a fifth of men in the survey said they'd end a relationship if they didn't think it was worth the expense.”
As you trip off down the tunnel of love together the financial stuff is ever-present, instructs a section titled ‘sun, sea and saving.' Giving no thought to questions like who pays for the holiday and simply swiping your credit card can be deeply worrying, the authors alert. “Because it could spell trouble that lasts much longer than your tan.”
They, therefore, advise that planning a holiday together is the perfect opportunity to chat about your spending and savings priorities. “Far better to know upfront whether his idea of luxury is your idea of no-frills. The more you can talk about things and plan together as a couple, the better.”
One of the tips in the book for ‘affordable holidays' is the assurance that you can holiday on the cheap if you are prepared to forego a few five-star treats. “More people are trying flashpacking (affluent backpacking) or hostelling (www.hostelworld.com), cultural exchanges where you do farm work in exchange for accommodation (www.helpx.net), staying with hosts abroad (www.couchsurfing.com) or swapping homes with people who'd like to holiday in your home while you holiday in theirs (www.guardiian
Budget your spend
Another tip is to budget for your holiday, by deciding in advance how much you can afford to spend, breaking the budget down into a spend-per-day amount, and sticking to it. “Take travellers cheques rather than your credit card – some make hefty charges when you use them abroad.”
Again, think before ‘in a weak moment you agree to join your best mate on a week's holiday boozing and clubbing' with friends, if ‘you're still trying to pay for last year's holiday with your already over-stretched credit card.' Be openly honest about what is and what is not realistically possible for you and find cheaper ways of spending time together, the authors counsel.
If envy keeps smothering you, when your friends earn more, and spend more, what should you do? “Just don't even try to keep up with them, that's all. Come clean about the meagreness of your income.” Also, be sensitive to your friends' financial status, exhort Pine and Gnessen. “Check what your friends are prepared to spend on a meal out before booking the priciest restaurant in town.”
As for envy, it should be insightful to know that it is not only the domain of the financially challenged, but also of ‘those with a few million secured under their diamond-studded belts.' It seems that whatever the size of their personal fortune, the competitive coveter will always want more, the authors fret. “Just goes to show that how rich you feel has relatively little to do with how much money you've got.”
After settling down together, what you may find remaining unsettled and unsettling is money. The book mentions the findings of ‘a recent survey by the Financial Services Authority (FSA)' in the UK that three-quarters of the couples in the Britain find money the hardest subject to talk about with their partners.
“More than a quarter of couples regularly argue when they try to discuss their finances; about a third lie to their partners about how much they spend on their credit cards and more than a third are kept awake at night worrying about their money situation.” A different survey found that debt and money worries are ‘the prime cause of relationship breakdown in more than 70 per cent of cases.'
Money differences can wreak havoc in any relationship and they are the number one reason for divorce, the authors rue. They insist, therefore, that if you are planning to live together happily, financial compatibility is as vital as sexual compatibility and that you need to be able to discuss both.
For instance, joint earners have to sort out whether everything will go into one account, or whether to keep some healthy distance, say Pine and Gnessen. “Some couples set up a joint account to cover shared expenses – mortgage, household bills and the like – plus each has a separate account for personal spending: a three-pot system – yours, mine, ours… Salaries go into the personal accounts with a set amount transferred into the joint account(s) each month.”
Do you know that ‘many women confess to keeping a stash of RAM in a secret account'? The abbreviation is not for random access memory, but ‘running away money.' Take a hard look at what can be ‘the epitome of financial adultery,' the authors suggest. “Ask yourself what's at the root of it. Is lack of autonomy an issue? Are you protecting yourself in case of a break-up? Do you resent the fact that your partner controls your spending?” Squirrelling money away is not always the answer; their prescription, instead, is to try addressing the imbalance by starting a money conversation, or to consider getting some relationship counselling.
Do you find money conversations so chilling that you would like to avoid them? You may be justified if you tend to catch someone unawares and they respond defensively, or you ill-express carefully chosen words and thus, trigger an explosive interaction. Constructive conversation is possible, the authors assure, and offer five key tips for the purpose.
One, choose the right time and place. Set a mutually convenient time and place to talk about money, they begin. “Try and avoid holding it late at night when you're likely to be tired. Do your best to minimise the chances of being disturbed… Make it regular, but be flexible.”
Two, agree upon the rules of conversation – such as no interruptions while the other person is talking; not blaming the other person; explaining your position in a calm manner, leaving emotions aside; and starting and finishing by saying at least one positive thing about the way your partner handles money.
Three, work as a team, recommend the authors. “Make a pact that you'll work together to sort out any financial problems you have. This means ensuring each of you has equal information about the financial situation and is equally committed.”
Four, get organised, by having a system of storing your paperwork in such a way that both can use it. And lastly, stick to the subject, instead of getting sidetracked into bringing up other grievances.
Money is a barometer of the health of your relationship, the authors observe. “And money arguments can be a symptom of some deeper relationship issues that you need to address separately.”
Worth a solitary study by each partner!