"Now it's true I married my wife for her looks ... but not the ones she's been giving me lately."
-- Comedian Jeff Foxworthy
If you've been sharing raised eyebrows and evil stares with your spouse lately, a financial disagreement is a likely cause. Money is routinely cited as a common source of friction between spouses, but there are steps you can take to change that.
A 2019 survey by Northwestern Mutual and wedding planning website The Knot questioned married folks on their views about money and budgeting. Some 40% of those respondents cited financial stability as their greatest long-term worry, making it a more prominent concern than raising children and maintaining intimacy in their relationship. But surprisingly, 48% of respondents said they weren't reviewing finances weekly with their spouse. And 22% admitted to having budgeting disagreements with their partner each month.
An open line of communication between spouses about money can head off arguments by ensuring both partners are on the same page about their money and financial goals. Here are five essential strategies to kick off money-planning sessions with your spouse.
1. Start with long-term goals
Start your money talks by sharing and prioritizing long-term financial goals. An obvious starting point is retirement. Discuss how each of you envisions life after work. Then address other common goals, such as funding college for the kids or buying a new home. Keep the conversation going to talk through "wish list" goals, too. Is there the chance one of you might start a business in the future? Does your spouse secretly want to buy a boat someday? Nothing is off the table.
Write down these goals and, together, rank them in priority. Next, you'll build a budget to start moving toward those goals.
2. Budget shared expenses
Budgeting begins with knowing what your lifestyle costs you today. Write down all of your shared and required expenses. These include rent or mortgage payments, property taxes, utilities, food, car payments, gas, and insurance.
Ideally, these should total about 50% of your combined take-home pay. If the percentage is higher than that, explore ways to reduce your costs. Often, food is the easiest place to trim spending: You could start cutting coupons or only buy items that are on sale, for example. If you need to make larger cuts, brainstorm what's possible. Could you move to a cheaper neighborhood, downsize your cars, or bundle your insurance plans to save?
3. Budget shared and individual spending money
Discretionary spending can be a point of contention for couples. Maybe your spouse spends $200 monthly on streaming services plus cable, while you'd be happy with a $10 monthly subscription to Kindle Unlimited. There is no universal solution to solve these differences, but you can and should define a system that works for the two of you.
If you have your required expenses down to 50% of your combined take-home pay, you can afford to spend another 30% on nonessentials. Split that 30% up in whatever way makes sense for your situation. Most of the time, it's logical to allocate 10% to each of you and 5% to shared discretionary expenses. In this framework, you each can make nonessential buying decisions as long as you stay within your 10%.
For this system to work, you'll have to talk through which expenses belong to you and which belong to your partner. If you both go to the gym, for example, that's a shared expense. But other items, like cable, may not be clear-cut. Perhaps your spouse feels strongly about having access to HGTV and you are indifferent to cable. If your spouse takes responsibility for that bill, it doesn't mean you must look away whenever House Hunters is on.
The goal isn't to be territorial. It's to provide a framework that gives each of you some financial decision-making rights within the relationship. If you play within the rules, you can each spend on things that are important to you.
4. Budget for the long term
At this point, you've allocated 50% of your take-home pay to required expenses and 30% to the nonessentials. That leaves 20% available for debt payments and long-term financial goals. Experts recommend you save 15% to your retirement accounts. Of course, if you have high debt levels or other financial goals to fulfill before retirement, that 15% may not be possible. Save at least enough to your 401(k) to maximize your company-match contributions and decide together how to allocate the rest.
5. Review transactions daily or weekly
Now comes the hard part. Set a recurring day and time for the two of you to review your spending. The first few sessions will probably reveal some holes in your budget and some misunderstandings about what's a shared expense and what's not. That's part of the process. Make adjustments to the budget and your spending rules until you land on a system that's sustainable. Remember that the two of you are on the same team, working toward the same list of prioritized goals.
Keep the money talks flowing
There's one final rule about these money-planning sessions: Leave the cold stares at the door. You'll both make spending mistakes and together you'll face unexpected expenses. Don't let these derail you from your shared plan. Just rework the budget and keep pressing on toward those long-term goals.