“Often, one partner takes on the role of ‘money manager,'” he told CNBC Make It. “But what happens if that person gets hit by a bus? It’s risky to have one partner with all the financial knowledge.”
And when one person is responsible for all of the money decisions, it can make the other person feel powerless in the relationship, he says. In fact, one survey found that about 25% of partners are unhappy about being left out of financial decisions. Fidelity Investments 2024 Survey.
Here’s Sethi’s advice on how couples can better manage their money together.
If you’re the “money person” in your relationship, it might be time to make a change, Sethi says. “The money person needs to take responsibility for slowly rebalancing the relationship.”
The easiest way to divide financial responsibility is to pick a few spending categories for each person to control: One person might make sure grocery spending doesn’t exceed a certain amount, another is in charge of paying insurance premiums, and so on.
“What’s needed is a clear line between responsibility and ownership,” Sethi says. “People respond well to ownership and want to play a role financially.”
Additionally, if you’re the “money savvy person,” try not to overuse financial jargon like “compound interest” or “tax-advantaged accounts” that your partner may not understand.
“Often one partner doesn’t really understand what they mean,” he says. “You have to put yourself in the other person’s shoes.”
Reviewing household bills may not seem like the most romantic date night idea, but Sethi says that couples having open discussions about money is important to aligning financial goals.
To get started, here are some common pitfalls to avoid: First, it’s wise to avoid blaming either partner for all of your money problems, as this can make them get defensive, says Sethi. “Saying, ‘You’re spending too much at Target and you have too much credit card debt,’ isn’t going to help anything.”
Instead of blaming each other, talk about how you two can come up with a strategy to work together to resolve your credit card debt.
“It’s important to have a connected conversation about money,” he says. “You’re going to be talking about it for the rest of your life together, so you might as well find a way to make it fun.”
Talking about money with your partner doesn’t have to be a depressing experience. Instead, you can think of it as an opportunity to reimagine a better financial future.
“When you talk about money in a relationship, there’s an implicit assumption that there’s an issue there,” Sethi says, “but often there’s an opportunity to build a wealthy life and have conversations about what that looks like.”
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