For richer or poorer: Having a financial conversation with your spouse
Having a financial conversation with your spouse may be harder than scheduling a date night. While it may be boring and uncomfortable going over finances and budgets, it is important for your family’s financial health. Talking about spending and saving gets you and your spouse on the same page working together towards your shared goals.
Many times, one spouse primarily pays the bills and manages the money. What happens if the spouse handling the money suddenly becomes incapacitated or dies? The spouse left behind has to figure out everything.
Think of a financial conversation with your spouse like a money check-up. It is a good time to evaluate your spending, savings, investments, and goals. It is also an opportunity for the spouse who doesn’t handle the money to understand how things are done and why certain decisions are made.
5 tips for having a financial conversation with your spouse:
Hold an “Economic Summit”
Pick a day a month to review statements, pay bills, evaluate investments, and budget for the future. Set it in stone so you can be organized and have the information you need. If you have a set time every month, you can look forward to addressing certain items at the time, such as “Should we look into solar energy?” or “Would we save money if we switched phone plans?”
Choose the right time and place
If you are a morning person and your spouse is a night-owl, try to have your meeting during the day. It is difficult when either one of you lack attention or energy. Find a place free from distractions. If you have children, meet when they are napping, on a playdate, or at school or an activity. Go to an unused room in your house so you don’t see chores to be done.
Get organized
Put your finances on the computer using a money management software. Go over your accounts and statements and determine if there are any errors or fraudulent charges. Have one place that you and your spouse can go to for important financial, legal, and medical information. You can put together a Family Information Binder or “911 Binder” so in case of emergency you can consult one place for the information you need.
Ask the right questions
Make the most of your meeting and focus on the finances. Don’t stray off topic to other areas. Create a set list of items you want to cover. You might ask yourselves:
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What are our goals?
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Is our money meeting our goals?
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What are our big financial expenses currently? In 5 years? 10 years? 20 years?
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What expenses can we reduce or how can we increase income?
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Can we sell unwanted or unneeded items that just take up space?
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How are our investments doing? Is it time to diversify?
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Are we up-to-date in your estate planning? Do we have a will, financial power of attorney, healthcare power of attorney, living will and trust?
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Do we need life insurance, disability insurance, long-term healthcare insurance?
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What happens if one of us is unable to work or dies?
Adapt
Sometimes a spouse wants nothing to do with the finances, happy to have their better half take care of it. It is okay if they do not want to participate in a monthly meeting. However, it is a good idea to sit down with them once a quarter or once a year and show them where your accounts are, where your investments are, your debts and your income. At the very least make a Family Information Binder with your legal, financial, and medical information. You will have peace of mind that they will know what to do if something happened to you.
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