In response to today’s economic times, it seems that couples are doing one of two things. They are freaking out about their current financial situation or buckling down and finally taking control. In either case, it’s the perfect opportunity for couples to begin to establish wise habits with money, set a few short and long term goals, make more sound financial decisions, and create a new foundation for success.
Though many things come to play when it comes to couples struggles in the financial arena there is one glaring obstacle that shows up over and over again: the lack of basic financial systems and strategies. They simply have never sat down to discuss the matter or if they have, the results of those conversations have been rocky at best so the couples steer clear of the topic altogether. Neither of these alternatives lead to happy financial bliss.
Considering that ‘money’ is often blamed for the majority of marital unrest and divorce, it would serve couples well to begin talking about money and their financial life before they even take that first trip down the isle. This way they can develop the essential systems and strategies that create happy couples that last the test of time.
A system is a consistent step-by-step procedure for doing something and it’s usually the reason something works or doesn’t. Think organization, method, or formula. In the home, it usually answers the question of “who will do what?” It’s a simple equation yet illusive for a lot of couples.
A good example of a well-oiled system is McDonald’s. Walk into any McDonald’s and you’ll notice all the cups stacked the same way, every uniform matched, every French fry perfectly crisp and salted. We come to trust that a hamburger we order in one McDonald’s will be the same in any other one. Quality is one of McDonald’s formulas for success and they achieve that success by creating the system first.
When couples develop good financial systems and stick with them, amazing results are apt to follow. Without them, couples are much more likely to live in fear and hope: fear that everything will fall apart and hope that it doesn’t.
A strategy is a plan for reaching a goal or obtaining a result. Couple conversations about financial strategies encompass ‘how’ they will be reaching short and long terms goals. Money is just one of the many conversations where couples generally don’t spend enough time and energy. Without a financial strategy, couples often end up 10 years down matrimony lane wondering why they are broke, just getting by, or fighting about money all of the time.
There are many areas where I advise couples to create consistency by designing systems to establish a financially stable and secure life.
- Recording paychecks and income
- Creating budgets and “rules” for spending (how much for living, saving, investing, playing, education and donating)
- Who will monitor budgets and how often
- Who will handle the mail, sorts bills, file papers
- Who will pay the bills
- Who will handle the children’s financial needs
- Who will contribute to what retirement and how often
- Who will handle investments accounts
- Who will interact with accountants, insurance agents, etc.
Great financial systems, or the lack thereof, will make or break a couple’s financial experience. Getting coaching before problems get out of hand is essential to the health of the couple’s financial future and their relationship, as a couple, to money.
In terms of developing strategies, there are many basic questions couples must ask themselves, no matter how long they have been together:
- Where are we financially, right now?
- Where do we want to go i.e., short and long term goals?
- When would we like to be financially free (vs. retire)?
- What methods would we like to use to become financially free? In other words, how will we create financial freedom for ourselves?
- Are we going to work as a team or individually?
- Will one person stay at home if there are children and will one work or will both parents work?
- What investment strategies does each prefer…real estate, stock market or business?
- What expertise does each partner need to provide his or her part?
As you can see, there’s a great deal of planning that must be done in order to build and establish sound financial systems and strategies. But what keeps couples from taking these steps?
The most basic answer to this question is that each person comes into the relationship with a financial blueprint* (from T. Harv Eker’s Secrets of the Millionaire Mind). In other words, each person has preconceived thoughts, beliefs and attitudes about money and wealth and, most often, they don’t mesh.
Instead, they provide areas of major conflict as each individual brings their own background and conditioning into the relationship. When backgrounds are sufficiently different, problems that could have been headed off at the pass with the proper communication, coaching and planning, often escalate into insurmountable issues that end in fights, struggle and even divorce.
So what should you do when you realize that you and your spouse need a financial tune-up? Stop immediately and realize you may not have the tools to sort it out yourself. I always suggest that my clients get a copy of Secrets of the Millionaire Mind, sit down with pen and paper and begin to unearth the roots of the problem. Too often, we continue doing the same things, hoping for different results. It takes courage to look at your limiting beliefs and conditioned ideas about how to handle money, but once you do, you can redesign your relationship with it in a new and supportive way.
If the economy has given you reason to pause and wonder about the stability of your financial foundation, sit down with your partner and take a look. Remember that by putting systems and strategies in place, your finances will be addressed and there will be more room for your relationship with each other!
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