Time for a financial heart-to-heart?

As Valentine’s Day approaches, Cupid’s arrow may snag that special partner, but be sure it doesn’t snag some financial troubles in the process.
FEB 09, 2009
As Valentine’s Day approaches, Cupid’s arrow may snag that special partner, but be sure it doesn’t snag some financial troubles in the process. “Court records show that financial stress is one of the main causes of divorce,” Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling, said in a statement. “Taking action now could prevent a disaster later.” The Silver Spring, Md., credit counseling group said arguments over money can be one of the biggest relationship-killers, and it is offering tips on ways to avoid a nasty breakup over money issues. “Money problems can start even before the ‘I do’s’ are pronounced,” Ms. Cunningham said. Indeed, the sky is often the limit during the courtship phase. Going into debt to pay for candy, flowers and meals at the finest restaurants may seem worth it at the time, she said. But as the relationship progresses, so does the price tag as costs associated with engagement rings, wedding ceremonies and honeymoons to exotic locales kick in. “Life is good until the bills start arriving,” Ms. Cunningham warned. It is critical that couples are honest with each other about their financial situation early in a relationship, the counseling foundation said. “The fact of the matter is that people bring financial baggage into a relationship and often don’t deal with it until problems arise,” she said. This baggage could take the form of a poor credit rating, mountains of accumulated debt or no experience managing money. “The time to address money differences is up front, before the financial bottom falls out,” said Ms. Cunningham. Other tips: •Be open to changing your lifestyle, whether that means cutting back on spending or taking a second job, and “resist whining” about it. •Don’t approach the money subject in the heat of battle, which means discussing the problem rationally without finger-pointing and laying blame. •Try to understand a partner’s long-held financial attitudes, many of which were learned in childhood through the way their parents addressed money issues. •Never hide income or debt – this is a sure relationship-killer, often known as financial infidelity. •Always discuss legal documents that you need to draw up or change, such as a will. •Construct a joint budget that includes savings, especially during tough economic times when every penny counts. •Make one person responsible for paying the monthly bills. •Acknowledge that one person may be a saver and one a spender, but both can benefit and learn from the other’s tendencies. •Allow each person to have independence by setting aside money that can be spent at his or her discretion. •Always talk about plans to loan money to family members or friends before making a decision. •Be sure to talk about caring for parents as they age and how to appropriately plan for their financial needs.

Latest News

RIA dealmaking accelerates as three firms hit AUM milestones
RIA dealmaking accelerates as three firms hit AUM milestones

Wealth Consulting Group, Coastline and Maridea report fresh capital, acquisitions and asset growth as advisor M&A keeps climbing

VastAdvisor closes $1 million SAFE round from advisor-side backers
VastAdvisor closes $1 million SAFE round from advisor-side backers

Carson Group's Dani Fava, Jason Pereira of Woodgate Financial, and Sally George of Convergency Partners led the raise as the growth-tech startup builds out its AI platform and leadership bench.

Wells Fargo adds three advisor practices as recruiting rebound continues
Wells Fargo adds three advisor practices as recruiting rebound continues

New teams from William Blair, Ameriprise and UBS bring more than $560 million in combined client assets to the firm's employee and independent channels.

UBS will pay advisors 'handsomely' for banking starting next year
UBS will pay advisors 'handsomely' for banking starting next year

Regulators this year approved UBS Bank USA’s conversion to a nationally chartered bank.

SEC accuses Tricolor executives of hiding $800 million collateral hole
SEC accuses Tricolor executives of hiding $800 million collateral hole

How a subprime lender’s car-loan bonds allegedly unraveled before bankruptcy.

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income