Q: I’ve always heard that disagreements about money are the number one cause of divorce. Why is that true? I’m about to get married, and I want to avoid the pitfalls. - Paul
A: Paul, that is a really interesting question. I’m not a therapist or psychologist, but I can certainly share what I’ve seen.
Having helped people with their finances for a long time, I have noticed that invariably, there are definite divisions of labor within couples. The divisions aren’t always the same from one couple to another, but the difference is nearly always pretty noticeable. In some couples, you may have one person who handles the day-to-day activities like paying the bills and balancing the check book, while the other person handles the big-picture things like investing for retirement. In other couples, it may simply be a function of having one “saver” and one “spender”. Regardless of where this line ends up getting drawn within any particular relationship, my hunch is that the stress between the two functions causes a lot of disagreements.
Now, as with any topic, open and transparent communication can usually address this divide. If you’re the big-picture person, share with your spouse where your joint assets are invested and why. If you see a drop coming in the market and want to invest your latest tax return or raise at work in bonds instead of equities, let them know that as well and explain the rationale behind it. Maybe they won’t care, but at least you’ve made the effort. Conversely, if you’re the day-to-day person, make sure your spouse is seeing the bills that are being paid so they aren’t caught unaware. Maybe open the mail together and put those bills on their lap in case they are curious about why there was a late fee last month, or what all the various charges were on the credit card.
If you’re the saver OR the spender, make sure you’re trying to find a compromise between protecting your long-term futures and taking all the fun out of the Saturday afternoon shopping trips. Neither of you are wrong…you just have a different relationship with money, and you need to understand and respect their points of view too. Hope this helps!!
I want to address an issue that has arisen multiple times over the months that I have been writing this column. It is a concern that I had hoped would go away with time, but continues to be fairly prominent in questions I receive, so I feel the need to address it head-on.
I regularly get requests to answer questions about financial distinctions between competing topics in this arena. Recent examples include differences between credit unions and banks. Or between commission-based and fee-only financial representatives. When I see these questions, I always purposefully sit down at my desk with every intention of writing an objective, fact-based response that magically walks the line in order to satisfy anyone who might live on either side of it. However, in every case, after staring blankly at my words on the screen for extended periods of time, I realize that it is not possible and I end up deleting hours of work.
Please understand that I live in this community. I have good friends who work in banks, as well as good friends who work in credit unions. I have friends who make their living providing fee-only financial advice, and those who work on a commission basis. So as much as I appreciate your questions, and although I do – of course – have opinions on these topics, I simply cannot run the risk of throwing an entire aspect of the financial worker’s community under the bus with the even slight chance of an inadvertent, poorly-chosen word or turn of phrase.
I sincerely hope that you’ll forgive the appearance that I am ignoring your questions that may be of this nature, or allow the occasional re-phrasing that I may do in order to allow me to answer you in a more tactful manner. Thank you in advance for your understanding, and I look forward to your continued readership.
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— Eric Litwiller has spent years helping people achieve their financial goals through the use of budgets, retirement vehicles and estate planning options. Prior to his current position as Director of Development and Communications for the Mental Health Association of South Central Kansas, he worked in fund development at Friends University and for a faith-based financial services firm. He is a firm believer in the importance of using Earthly riches to fulfill a mission of Christian stewardship. He is not a licensed financial planner.