Whilst managing your finances is vital to creating wealth, implementing a savings-oriented budget should be a shared goal between you and your partner, and even your kids. There are sacrifices to be made; compromises that affect your standard of living as a family, and of course the huge rewards that come from realising your financial goals can and should be a happy shared experience.
This issue of the Access Finance Wealth Blog dives into the importance of talking about money with your family, and how to do so in a productive fashion that brings you closer together rather than creating conflict that can push you apart.
The first person to consider when planning a budget is your partner. Shared dreams and objectives will invariably improve your chances of creating wealth. Regardless of whether or not you are both working and regardless of your respective salaries, setting short term and long term goals that incentivise a saving culture at home and reward you as a unit will turn your saving journey into a more fun and satisfying experience that can even improve your relationship. Setting your own goals and forcing a savings regime on your spouse that hasn’t been devised in an open manner will alienate him or her, create conflict that can negatively affect your wealth, and if you do achieve financial security, it will be much less satisfying if it came about in a tense environment. Wealth creation is a long journey, and you need all hands on deck.
Knowing someone’s personal ambitions and financial background is part of the process of forming long term commitments. Maybe John Lennon was right – money can’t buy you love, but it is famous for ruining it! Knowing how much your partner earns is a small part of it – it’s also important to see how he or she spends their money, how they use credit and savings. Will you feel comfortable pooling your resources with someone who often eats at expensive restaurants beyond his means? Does her cost-cutting drive you insane? These are things you best discuss early on to reach a compromise. If you can’t see a way around it, be warned that many relationships meet their demise over money and a shared vision around finances is just as important to a long happy relationship as the more obvious ones such as the desire to have children, religious beliefs, and personal values.
Creating shared goals is a process of compromise. It’s a conversation that you should start as soon as possible, but definitely at the beginning of any budgeting and saving exercises. The best way to make it a positive experience is by listening to your partner first, asking their opinion and feelings, even when it concerns your personal financial decisions, which might not be closely tied to theirs yet.
“I want to own my own house one day. Does that sound good? What kind of place do you want to live in? What do you know about saving for a deposit?” – lay your dreams out there, but open it up for discussion. Chances are your partner also wants to achieve wealth, so start by creating a shared vision. Get their input every step of the way when creating a budget
“We’re spending too much. Where do you think we can cut costs?” – The shared dream is the easy part – the devil is in the detail. Conflict about money will most often arise from different spending priorities in day to day life. Make sure that cost-cutting measures are give and take – make sure that you both feel the pinch on personal luxuries when you are cutting back. Try and think of common ground for non-essential expenses. For example, allocate money for the occasional nice dinner out as a couple rather than new clothes for yourself.
Throughout the journey of financial cooperation, transparency is vital. Make sure that you both reveal all your debts, savings, and income. If you are using a financial adviser, be sure to go together. Divide the research into investment options and present your findings to each other as if in a boardroom. Set up regular financial meetings to check on all your accounts and see if you’re on track. Never go off budget without discussing it first! Breaking the rules can be a start gun for tit-for-tat spending that pulls you off course and negatively impacts your relationship. Agree to a reward system for hitting targets.
Oh, and don’t forget the kids! If both parents are comfortable and mature about money-talk, it will foster good financial sense into their children that will make them happier adults. Ask them what they would personally like to start saving money for, and help them get started with a simple wall chart of savings targets to reach their goal, no matter how small. Paying them for some of their chores will help them understand the journey you are on as a working man or woman better, and why they can’t always get what they want, when they want it.
If you are saving for a car or a house, get the kids excited about it too. Put pictures up of your dream house somewhere where everyone can see them, to act as positive reinforcement for them as they wonder why they aren’t allowed to drink all the milk in the fridge or to go to the movies every weekend. Make them feel a part of it, and keep them informed in a non-stressful manner, and you will have won the support of key allies on your long journey.
And remember, if you’re sending money home to Zimbabwe for any reason, Access Finance is here to help. Get your money home cheaply and instantly by clicking here.
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