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The Secret to Divorce-Proof Finances

Do you trust your significant other with the family checkbook?

Half of those in a committed relationship answered "yes" to that loaded question -- posed in a Harris Interactive survey sponsored by Redbook and Lawyers.com -- and back up their conviction by commingling all of their bank accounts with their better halves.

So, how does your financial union stack up?

Secret shoppers
Even in the best of times, money can be a conversational third rail in a relationship. Most couples, whether married, engaged, or cohabitating, cop to having an occasional tiff about the family finances.

Lots of couples butt heads over their spending priorities. I've been the on-call referee for my coupled pals in many such spats -- I hear things like "You will never guess what he bought!" and "Can you believe what she paid for that?!"

Want to keep the peace about spending? Simply stay mum. At least that's how three out of 10 adults say they deal with this point of contention. (One in 10 admits that a secret retail-therapy excursion exceeded $1,000.)

Oh, but you want your union (financial and otherwise) to last, right? Then it's time to come clean. Your money lies may actually be the most dangerous ones you tell: One-quarter of respondents to the Harris survey said that financial fidelity is more important to them than romantic fidelity. (Me? I insist on "all of the above.")

If your money tete-a-tetes typically result in one of you sleeping on the couch, rest easy. A few simple strategies can strengthen your financial union, starting today.

The most powerful relationship rule of thumb
Want the best result ever for your next money fight? Skip straight to the make-up part -- you know, when tempers have softened and you're committed to coming to a resolution -- before the bad vibes even start brewing.

This pre-emptive "just-in-case" conversation is one of the best ways to divorce-proof your finances. You're calm, cool, rational, and looking really cute to your Sig. O. Scheduling your discussion about a sensitive money issue before it's fodder for a fight allows you to plan a nice meal (and line up a babysitter and a dog-walker). Even better, it sets up you two lovebirds to be partners, not adversaries -- and, another bonus, it will save you many sleepless nights on the couch.

You don't have to take my word for it. This relationship rule of thumb is supported by one of the foremost negotiation experts -- Daniel Shapiro, co-author of Beyond Reason -- with whom I recently talked about handling conflict in ways that will actually improve your relationship.

He and Roger Fisher, of Getting to Yes fame, have found that emotions can be a powerful negotiation tool. Pre-empting conflicts while addressing key emotional triggers is one of the most effective ways to come to more fruitful resolutions. This tactic works not just with politicians, CEOs, and hostage negotiators, but also with everyday folks hashing out money conflicts over dinner. (Check out my interview and a real-life couples negotiation in the February issue of Motley Fool Green Light with this free 30-day trial.)

Pre-fight prep
Not every money issue needs to turn into a formal financial summit. Instead, focus your next money powwow on a few of your biggest and most sensitive financial concerns.

After that, establish some "rules" to prevent everyday money matters from turning into nonstop opportunities for bickering. For example, pick a dollar amount you can both blow each week without having to run your purchases by one another. Set up decision-making buckets in which you agree to consult with each other and come to a spending or saving decision before making a move.

When in doubt, Shapiro advises using "ACBD" as your automatic default. It stands for "Always Consult Before Deciding." (It's not to be confused with the "Act now; apologize later" decision-making approach that may fly a few times but is statistically unlikely to lead to make-up nookie.) And it may be the single rule of thumb that helps keep the peace in your household.

For richer ... or even richer
Managing money as a twosome doesn't have to be a hand-wringing affair. For a host of other relationship rules of thumb and other tips on negotiation tactics you can use with your boss, a store clerk, or your spouse, check out Motley Fool Green Light (here's that one-month free-trial link again). Also in the February issue, my co-advisor and investing counterpart, Shannon Zimmerman, serves up some strategies that will help couples harmoniously merge opposite investing styles within a single nest egg and offers his-and-hers investment ideas in "Venus & Mars Go (Stock) Shopping."

In addition to her regular gig as co-advisor for the Motley Fool Green Light service, Dayana Yochim is the go-to referee for many of her coupled friends in financial pinches, some of which she shared (with permission!) in The Motley Fool's Guide to Couples & Cash. The Fool's disclosure policy is always financially prudent.


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