By Maika Q. Bernardo | 02 October 2013

Originally posted at http://www.smartparenting.com.ph/home-living/moneywise/14-money-problems-of-couples-and-how-to-deal-with-them

As we all know, love is not enough to make a union last. There should be respect, friendship, trust, and a mutual understanding of how money (whether yours, your partner’s, or the household’s) should be handled. “Money is a common

conflict among married couples simply because a lot of the things they do involve money: paying the bills,  putting food on the table, sending the kids to school, going on vacation,  etc.,” explains Alvin Tabañag,  a registered financial planner and financial educator. “Problems arise when husband and wife have different financial priorities.” “Prior to marriage, each individual already has his or her own financial background, lifestyle, mindset, and upbringing,” adds child and adult psychiatrist Ann Princess Grana-Nespral, M.D., D.P.B.P.  “Yours may not necessarily be compatible with your partner’s.”

“When a couple gets married, they don’t just become one mentally, physically, and emotionally —they also become one financially,” says wealth coach and motivational speaker Chinkee Tan. “Everything they own becomes conjugal property under the law, including their debts. So if these liabilities are not disclosed or discussed properly, these may cause problems later on.”

Family ties 
1. “My mother-in-law is sick and my husband needs to help out financially, but it’s taking a toll on our own finances.”

Tan: “Part of family finance is setting aside a ‘helping fund.’ We all have relatives who may need our help, just as we may also need theirs. Agree as a couple on how much money you can set aside for this fund. Let your husband explain to his family that this is the best you can do for now.”

Dr. Grana-Nespral: “Discuss with hubby: What is a realistic amount you can give your mother-in-law without draining your savings? How much are you comfortable to share,  and how much does he think he needs to contribute? Agree on an amount.”

 

2. “I live with my husband’s family — his parents and his brother’s family of five. We have only one child. He and his brother have been splitting the household expenses equally between them. I think it’s an unfair deal, since my brother-in-law’s family consumes more.”

Tabañag: “First, find out how your husband feels about the arrangement. If he can afford to pay for half and doesn’t mind the setup, and it’s not affecting your family’s financial condition, then don’t rock the boat.  “But if your husband shares your sentiment, then he should talk to his brother so they could agree on a more equitable arrangement. An equitable arrangement doesn’t necessarily mean your brother-in-law will have to give more. Yes, his family consumes more, but having more kids can also mean having more hands to help out at home.”

Dr. Grana-Nespral: “Don’t confront the in-laws right away. First, gently discuss with your husband how you feel. Say, ‘I think we can adjust the bills payment accordingly since we consume only this much,’ but don’t say, ‘The arrangement is unfair! Your brother’s family consumes more than we do!’ You and your husband must show a united front to your in-laws if you really want to adjust the situation. If you don’t have your husband’s support, no changes may occur. The best solution, though, would be to move out and live on your own, so you could better gauge how much your cost of living is, without any comparisons. Discuss with your husband if this is feasible.”

 

3. “My husband has a child from a previous relationship. I understand he has financial obligations to the child, but the mother seems to be taking advantage of the situation: she enrolled the child in a very expensive school, plus extra-curricular classes, and now she wants my husband to pay for the driver she hired! He is inclined to give in — out of guilt —but I feel I should put my foot down.”

Tabañag: “There should be a clear line between justifiable child support and extortion. I think, in this case, what the ex is asking for is excessive and beyond normal child support. Your husband should not feel guilty about refusing such a ridiculous demand. Consult a lawyer for clarification.”

Dr. Grana-Nespral: “Your husband’s foremost financial obligation is towards your family. Tell him you may not be able to afford the additional expenses from his previous relationship because such expenses are not even part of your lifestyle. He cannot make financial decisions without your involvement in the decision-making process.”

Different strokes for different folks 
4. “I married a simple man who insists I live less luxuriously, but I grew up pampered by my parents. He thinks it’s best to save for emergencies. I think it’s not fair that he’s asking me to adjust to him, especially since I’m spending my own money.”

Tan: “You may have been raised differently by your parents, but once you get married, you and your husband must learn to agree on how much money you should set for your own monthly expenses and how much should go for emergencies or savings. Once the limits are set, then you can spend to your heart’s desire.”

Dr. Grana-Nespral: “In the first place, is it fair for him to adjust to you? You are now married; you are not only responsible for yourself but also for your partner. It is not ‘my’ money or ‘your’ money anymore — it should be ‘our’ money. Make a compromise regarding your financial situation with your husband. Discuss what a comfortable lifestyle is for both of you, and what can be set aside for emergency expenses.”

5. “My husband and I each have different ideas about how to grow our savings. He likes investing in the stock market; I prefer money markets. He says it’s a waste of opportunity, but i think investing in stocks is akin to gambling! Is there hope for a compromise?”

Tabañag: “A good investment portfolio should include both high-risk, high-return (e.g. stocks) and low-risk, low-return (e.g. bonds and other fixed-income securities) investments. Why not consider putting money in mutual funds or unit investment trust funds (UITFs)? These funds can give you the best of both worlds since these are invested in a select basket of stocks, bonds, and other fixed-income securities. These funds also come in different varieties (equity/stock funds, balanced funds, bond funds, and money-market funds) to match different levels of risk tolerance.”

Dr. Grana-Nespral: “Financial discussions require frequent dialogues, considerations, and negotiations. Decisions regarding savings are a joint effort. Compromise means that you and your husband meet halfway, and not have it your way or his. Continue your discussions. Refrain from speaking in anger. Verbalize your fears and concerns, and let each other know how one is feeling and thinking. You can start by saying, ‘I feel that stocks are akin to gambling, and this worries me about our savings. What about you?’ or paraphrase his statement, ‘Did I get it right that, for you, letting the money just sit in bonds is a wasted opportunity? May I know why?’ Persevere with your discussions. Work at it and you’ll come to a compromise.”

6. “My husband and I have been saving up for this really nice bed. Last week, I saw that it was on sale! When I couldn’t reach my hubby for his go signal, I decided to purchase the bed with our joint credit card. When he found out, he went ballistic! He said I should have waited for him before buying it. Was I really wrong?”

Tan: “Every major spending decision must be done together by husband and wife. I don’t think your husband got mad because of the money involved; I think it’s because he felt that you didn’t show him respect by making a major decision without consulting him first. My suggestion: apologize! Tell him it was an oversight on your part and that you take full responsibility, and promise it will never happen again.”

Dr. Grana-Nespral: “Put yourself in his shoes: How would you react if your husband suddenly made an expensive purchase without your consent? Even if you have discussed it before, actually making the purchase is a move you should have made together as a couple.”

7. “I save up for little pleasures, such as going to Hong Kong Disneyland with our kids. But my husband often nixes my plans and wants me to save up for more practical things. He calls it ‘luho’, but for me, it’s a lovely memory we can look back on. And it’s fun! I’m so sad that we don’t see eye to eye on this.”

Tan: “It’s possible that your husband is not saying ‘no’ to the idea but just to the timing of the vacation. Suggest this compromise: What if you both agree on an amount you can set aside on a monthly basis and use it to pay for your vacation? And you take the vacation only when the target amount is reached. Once that is done, I see no reason for your hubby not to agree. It is just a matter of agreement and setting your priorities.”

Tabañag: “Look at the situation from his perspective. Maybe he sees something that’s more important and of a higher priority than a Disneyland trip. For example, he might have noticed that you have yet to save up for your child’s college education, or maybe you are still paying off a pile of debts. If this is the case, then a Disneyland trip now would not be a very good idea.”

Dr. Grana-Nespral: “You may have different interpretations of what is fun, luho, and practical. Dialogues with your husband about these differences in perception will help both of you understand each other’s perspective.”

8. “I want to enroll our child in a top private school, but my husband says that we can’t afford it, and that our son can get a decent education in a less expensive private school nearby. But I don’t want ‘decent’; I want the best. Besides, we can always work hard so we can afford to keep him in the better school, right?”

Tabañag: “While a child’s education is one of the top priorities of parents, it is not the only financial priority. If you insist on sending your child to the expensive private school, you should also consider how it would affect your family’s quality of life. Would there still be enough funds to address other needs such as food, clothing, savings, leisure activities, trips, etc.? Or would you have to cut back on a lot of things and significantly lower your standard of living? Would it be worth the sacrifice? Yes, you can work harder, but there’s no guarantee that your hard work will translate to a higher income. For all you know, you could be out of work within the next few years. What would happen then?  Or what if you had more kids? Would you still be able to afford sending them to expensive private schools? “Figure out also if you are doing this for the right reasons. Is it really because you want the best for your child, or is it just for bragging rights? Are you doing this to prove a point?”

Dr. Grana-Nespral: “Be realistic with what you can provide, even with your best effort. You want your child to have the best — but the best of what? In ‘working harder’ to send your child to the expensive school, you may end up compromising your quality time with your family, which is more important. The best way to decide on a school for your child is not by how expensive the tuition is, but by how the school can help mold your child with a values system that agrees with yours.”

9. “My husband and I have a joint account. I love to shop, but he doesn’t and this makes me feel guilty. In effect, I’m the only one getting money from this pool, and while he doesn’t mind that I do so, I end up hiding my purchases out of guilt. What’s an ideal setup for this situation?”

Tan: “The ideal setup for this situation is what my wife and I have been doing for years now.  Every start of the month, we agree on our own spending budget — things we want to buy for our own personal needs such as clothes, makeup, and many others. We then set aside an amount for each of us. The agreement is we can spend the money in one day or in 30 days, no questions asked. But if I do spend all my money in one day, I cannot ask for more. So if you want to shop without guilt, just agree on an amount you both can afford to set aside for your personal luxuries.”

Dr. Grana-Nespral: “The money may not be the problem here. Why are you guilty? For whom are the purchases? If your husband is okay with this situation, why are you bothered? Why do you feel you have to hide from him? Discuss with your husband your feelings regarding shopping and getting from your joint account, and how these feelings affect your behavior.”

Gender (in)equality 
10. “My husband and I earn about the same amount in wages, but I ask him to shoulder  70 percent of our household expenses. He says it isn’t fair and that the share should be 50-50. But I believe that the husband should be the provider and that I’m already doing him a favor by shouldering  30 percent. Am I correct?”

Tan: “There is no hard and fast rule when it comes to the percentage a couple should give to support the needs of the family. This is the reason why, in my pre-marital counseling as a wealth coach, I often advise the couple to agree as early as possible on who is responsible for what. Financial planning and goal-setting must be written down so there won’t be any false expectations. We cannot assume that your partner thinks the same way you do. If you were not able to agree on it from the start, it is time for you to make it right. If you still cannot agree, it is time for you to bring an outsider’s perspective, someone you both trust, respect, and will listen to.”

Dr. Grana-Nespral: “Why is your husband asking you to shoulder half of the expenses? It may be his way of telling you that he needs help with them. Expectations regarding financial responsibilities have a huge role in a couple’s relationship; each of you should be clear on your expectations for one another. You may need to discuss again your financial responsibilities and expectations.”

11. “I earn more than my hubby, but he insists on paying for everything because to have me chip in would be ‘emasculating.’ How can I let him accept my help without wounding his macho pride?”

Tabañag: “The ‘family income’ is not about the individual income of husband and wife. There’s nothing emasculating about taking money from a common fund to pay for something. If your husband insists on paying for everything, then let him; he could probably afford it. You can just work on building your family’s savings and investments. This way, you get to let him keep his macho pride and at the same time you help secure your family’s financial future.”

Dr. Grana-Nespral: “Can your husband comfortably pay for everything? If he can, why are you offering to chip in? You can set aside your money for emergency purposes or increase your family savings.  If he can’t pay for everything, you may have to discuss a compromise with him. Ask him why it is emasculating. What exactly about sharing the expenses is emasculating? When you understand his side, then both of you may reach a compromise. Reassure him that he is your partner, and as partners, you both share the financial responsibilities.”

12. “My husband has been unemployed for a few months now so I am the family’s sole breadwinner. Recently, he gifted me with a very expensive piece of jewelry for my birthday. I felt uncomfortable accepting the gift since we should be on ‘saving mode’. How do I talk to him about this without sounding ungrateful?”

Tan: “Never turn down a gift from your husband. You may mean well by raising the issue of your financial situation, but it may backfire if addressed at the wrong time and in the wrong manner. Talk about your monthly expenses and make a written plan on how you are going to pay your obligations. Based on that, your hubby may then realize that even if he meant well, the timing was not right. Let it come from him, not from you.”

Dr. Grana-Nespral: “A gift should be accepted graciously. Your mindset about gift-giving may have adjusted due to the changes in your financial situation, but it may still be the same for your husband. Does he always give extravagant gifts? If he usually does, you can approach him about it. He may not know that your mindset has changed. Reassure him that you do not want to sound ungrateful, but you are uncomfortable with expensive purchases given your current financial situation. Say, ‘I feel uncomfortable with the expensive gift because I think we should be saving,’ but don’t say, ‘You are spending too much, and I’m the only one with work at the moment.’”

Making changes 
13. “I am a housewife. My husband is thinking of quitting his job and starting our own business. I’d love to support him, but I’m scared to take such a huge risk. Why give up a steady, secure source of income for something so unsure? But I also want to be supportive of his dreams. Help!”

Tan: “As a wealth coach, I always encourage my clients to prepare for and expect the best but also plan for the worst. These are the things to consider: Do you have at least six months’ worth of savings in case the plan does not work? Do you have a back-up plan for products or your initial investment? If you want to play it safe, start your business while still employed, and wait for the business to grow to an amount that is acceptable for you and enough to sustain your needs before going full time.”

Dr. Grana-Nespral: “As a partnership, concerns and fears of each one should be taken into consideration because it is not only his dream but also yours. Don’t be afraid to voice your concerns now because this will help him achieve his dreams realistically. Your concerns will help both of you achieve your dreams.”

14. “Is a joint account between husband and wife advisable? My hubby insists we get one, but I don’t see what for. Currently, we’re able to accomplish our family’s financial goals with our own personal bank accounts.  We have this arrangement where he pays all the bills up front with his money, then at the end of the month, I reimburse him half of the expenses from my account. Is this a strange setup?”

Tan: “You must try to understand the reasons why your husband  wants to have a joint account, aside from it being a convenient way of tracking your money. Maybe he feels having separate accounts is a sign of mistrust. If trust is a major issue for him, you just need to support him and find another way to keep track of your expenses in another ledger to achieve what you also want.”

Dr. Grana-Nespral: “You and your husband may have different financial backgrounds. What may seem strange for him may be normal for you. What may work for one couple may not work for you. In any case, a joint account will pool your money, which either one or both of you can use. If you do set up one, you have to decide whether either one could have access, or you both have to agree jointly before the money could be withdrawn.”

Avoiding money problems
What’s the best way to achieve a harmonious marital and financial relationship with your spouse? Our experts share advice:

Prior to marriage
1. Discuss finances openly. “Talk money with your honey. Disclose all incomes and debts,” says Tabañag.

2. Make the most out of pre cana counseling (i.e. marriage preparation). “These activities are required by the church prior to getting married for a reason,” says Dr. Grana-Nespral. “They [give a glimpse of] what marriage is like. They [tackle topics] such as who will handle the money in the family—a topic seldom discussed by a couple before getting married. This way, a couple with different values and mindsets about money could already see if they can compromise. If they can’t, then they could withdraw their marriage plans.”

3. Create common financial goals; set and agree on financial priorities. “Husband and wife are not likely to get into unpleasant situations involving money if they have a common understanding of what is really important and beneficial for the family,” says Tabañag.

During marriage
1. Set aside a regular time to discuss financial matters.
2. During discussions, keep calm, and speak properly. “Give each one a chance to talk, while the other listens. Use ‘I’ rather than ‘You’ statements,” advises Dr. Grana-Nespral.