June is traditionally the month of graduations and weddings. Last week I dealt with the topic of life after graduation from a financial perspective. This week we are onto the topic of money in the context of a relationship.
Money and the way we engage with money—both individually and as a couple—are fundamental aspects of any relationship. There is, of course, the obvious notion that you need money at some level in order to engage in a relationship. Whether it is a date or any other type of social interaction it inevitably involves spending money and a lot of what passes for entertainment is designed to accommodate these types of interactions.
Once a relationship gets closer there is the traditional cost of an engagement ring and following that the cost of a wedding. These significant one-off expenses then flow seamlessly into the cost of building a life together which includes owning a home, possibly two vehicles, preparing for and then raising children and eventually growing old together and retiring while catering for each other’s medical and care needs in old age.
When you put it all together there is extensive room for disagreement and conflict and this is why money is often cited as a fundamental issue in the break up of many a relationship.
Many times when relationship advice is being given, especially to young people, the perspective is that you should find yourself first before you can engage with someone else in a relationship.
Part of that search also includes an understanding of what money means to you and how you relate to money. If you don’t understand that upfront then you are setting yourself up for many challenges, even disappointment into the future.
Views on money
Money is a tool that allows us to acquire other things that we may desire. So understanding more about our desires is a key part of understanding our relationship with money. This is because how we spend money and what we spend money on is an essential part of our values and those values need to at least be respected and ideally need to be compatible with the values of our closest relationships.
For example, lets say you grew up in a home where there wasn’t much to go around, but more than that, as a child you were the one who had to take responsibility for some of your siblings.
In that environment you may often find yourself having to sacrifice some of what is yours in order to protect and make sure others have. In that environment you are conditioned as you go through adult life to save and accumulate. In so doing, you are not only seeking to protect yourself but also those around you that you care for.
Here money represents a source of comfort and security. You derive more from having it than from spending it. It is not necessarily about being greedy since you may not want more just for the sake of wanting more but you want more for the security that it brings.
A person who has this relationship with money will find it more difficult to, for example invest in the stock market because the variability of returns may cause many sleepless nights. For them getting into the stock market is practical only after they have attained a level of financial security, not as a means of obtaining financial security.
Now consider another personality, one who is accustomed to being the centre of attention or at least enjoying the moment. For them money is not about providing security but rather money is a tool for enjoying life in the moment because it’s all about the now. They may be more impulsive in their spending and would rather spend on something they enjoy now than see money sitting in a bank account.
For all intents and purposes, tomorrow will take care of itself and for them that is a truth because that’s exactly what has happened up until now. For this person investing is for the purpose of having the opportunity to enjoy more at a faster rate. There is no point in waiting for retirement, what if retirement never comes?
How do you think a couple with these contrasting relationships with money will fare?
Joint thinking
Certainly you will agree that they need to individually have an understanding of their relationship with money before getting into a committed relationship. One may seem selfish and greedy to the other, while the companion may be viewed as careless and irresponsible. Yet both are well intentioned and there is merit to their views about money and how they use money to express their respective values. In fact, if both individuals are able to understand and respect their partners view about money then it can make for a stronger relationship because one can help the other to achieve a level of balance.
As they go through life in partnership complexities abound and compromises will be required. One partner living on the edge because they lack the security that money brings and the other feeling frustrated that they can’t enjoy the things they want to enjoy will over time take its toll.
Their outlook on money influences almost every decision, as it has consequences for taking a vacation versus setting aside that money for retirement or saving to buy a house versus being willing to rent and move from place to place as required.
Once you have understood your relationship with money then you would be in a position to explain why you want to do things in a particular way. It is at this stage that you can then engage in joint discussions and come to some level of agreement on the way forward.
This is the time to then decide whether you keep your funds separate or co-mingle and to what extent. It is also the time when you are able to make joint financial decisions and establish priorities as a couple.
Everyone needs a level of financial independence but in an interdependent relationship a balance of “mine” verses “ours” is required. That balance will differ from couple to couple depending on their respective views and attitudes.
The challenges that occur in relationships are primarily the result of misplaced or unmet expectations. Money is a key area where expectations that are not in sync can lead to conflict.
“Why did you buy that when you know we are trying to save?”
“I can’t enjoy anything you want to save everything?”
Add to that mix the issues around spending money on alcohol and gambling and the addictive qualities that these circumstances bring about and you can appreciate the fundamental role that money plays in maintaining a strong and lasting relationship.
Ian Narine can be contacted via email at ian.narine@gmail.com
