Do you consider yourself to be a saver or a spender?
If you’re like most people, you probably answered “saver.” A 2016 study from TD Ameritrade found that 68% of Baby Boomers and 62% of Millennials consider themselves to be savers. These savers tend to be married to other savers (66% of Baby Boomer and 52% of Millennial savers have a partner that is also a saver).
So while couples are often in sync when it comes to finances, there’s a big chunk of people in a relationship that consists of both a saver and a spender. Because financial matters can often be a source of conflict within a relationship, it’s critical that you and your partner are on the same page.
Here’s what savers and spenders can do to preserve the harmony in their relationships.
Embrace Who They Are
It’s difficult to turn a spender into a saver and vice versa, meaning you shouldn’t necessarily be focused on trying to change them. Instead, work together on your family budget to decide how much you’re going to save each month and where you’re going to ultimately spend your money. It’s also a good idea to come together to define what’s necessary in your budget when it comes to spending.
We like to say that you can be both a saver and a spender. We like to spend money, whether it be on a nice meal, playing a round of golf or going on vacation. But we also prioritize saving and investing first. If you invest for the future first and are adequately funding your savings goals, it’s okay to spend the money you have left over.
Work Together Toward Common Goals
One of the best ways to create financial harmony is to find financial goals and work toward those goals together. When we work with clients, we like to recommend that they individually compile a list of their 5-10 top financial goals. Then, we bring those two lists together and see where their goals overlap and where they can compromise on their differences. This not only helps to reset your savings goals, it also helps you to realign your values as a couple.
Communicate, Communicate, Communicate
When disagreements about money arise, the common issue is a lack of communication. Speaking about money on a regular basis helps you maintain a healthy financial relationship. To help facilitate these conversations, spenders can keep track of their receipts and share with their partner the items that need to be purchased on a weekly basis. Savers, on the other hand, can keep their partner up-to-date on which expenses need to be worked on and offer a general overview of the family’s finances to help ensure there are no financial surprises.
It’s unlikely that two people in a relationship will always see eye-to-eye on financial decisions. But if you’re consistently trying to work together, you’re communicating often and your financial decisions are grounded in your core values, you’ll find it easier to compromise on those decisions that you may initially disagree on.
This article originally appeared on May 7, 2017 in the St. Paul Pioneer Press. You may view the article here.
Series 7 & 63 Securities Registrations,1 Series 66 Advisory Registration, † Insurance License Bruce has been in the financial services industry since 1983 and is one of the founders of Wealth Enhancement Group. Since 1997, he has hosted the “Your Money” radio show, a weekly program that focuses on delivering financial advice in a straightforward, jargon-free manner. Bruce also hosts with the "Mid-Morning" crew on WCCO-TV each Tuesday morning to...Read More