Top Five Money Tips for Couples

My wife and I are financial opposites: she’s a tightwad, and I’m a spendthrift. That can get pretty complicated! As a result, I have developed a strong interest in understanding how couples can navigate the various money-related complexities of marriage. I’m lucky because I get to do research on these topics (essentially, “me-search”). Below, I want to share my top five money tips for couples based on this research.

1. Each person should complete the tightwad-spendthrift scale for themselves and for the other person (guessing how the other person responded). 

You’ll want to compare how your partner sees themselves to how you see your partner. Discrepancies can spark conversations that lead to greater mutual understanding. Once partners understand how they differ on the tightwad-spendthrift dimension, they’ll be better positioned to make a variety of important decisions. For example, when partners disagree about how much to spend on a material good (like a new car), I generally recommend deferring to the partner who is more of a tightwad. However, when partners disagree about how much to spend on an experience (like a vacation), I generally recommend letting the partner who is more of a spendthrift win.

2. If you are considering it, just go ahead and open a joint bank account. 

I recommend routing all incoming household money through a joint account, as a bit of “psychological money laundering.” You want to turn “your money” and “my money” into “our money.” Relationships can often slide into scorekeeping (keeping precise track of what each partner is contributing to the relationship), which can chip away at happiness. Opening a joint account can be one way to avoid that. Joint accounts can also prompt discussions that help partners learn about each other’s goals and plans. My colleagues and I recently ran an experiment with newlywed couples, and we found that couples who we instructed to open a joint account were happiest two years later (compared to couples who were instructed to maintain separate accounts and couples who were free to manage their money however they liked).

3. You can have separate accounts attached to your joint account. 

Each person should be able to spend some of “our money” without being closely monitored by their partner. Complete financial transparency can lead to unnecessary arguments over inconsequential purchases. For example, one person might get irritated when they see how much their partner is spending on lattes. However, an afternoon latte might actually be essential for your partner to make it through their day, and saving that money is unlikely to make a meaningful change to your household finances. Partners should have a general sense of how much everyone is spending – for example, we both know that we’ve each moved $1,000 from our joint account into our separate accounts. Getting more detailed than that can lead to more harm than good. In other words, I favor “financial translucency” over “financial transparency.”

4. Don’t ask your partner what gift they would like to receive. 

Gift-giving occasions are important opportunities to communicate to our partners that we appreciate and understand them. Asking your partner to tell you what they want erases that opportunity. Plus, it’s very easy to ask that question in a way that suggests that you find the whole gift-giving process to be a burden. For example, consider the following way that someone might ask their romantic partner what kind of gift they would like:

“Ok, I guess your birthday is coming up. You didn’t really like what I got you last year, so could you just tell me what to buy you this year?”

How romantic! If you want to find gifts that will truly delight your partner, you’re going to need understand them deeply. That requires curiosity, careful listening, and plenty of time.

5. Kids are more likely to mimic how you spend than they are to follow your advice about spending. 

If children are in the picture, it’s important to be aware of how they are likely to learn about money. Kids often get mixed messages from parents. The same parent who urges their child to save the birthday money they received might, hours later, show their child the new iPhone they bought from themselves. Of course, children can’t immediately mimic all the ways their parents spend money—kindergarteners can’t sign unfavorable mortgage contracts, for instance. But the available evidence suggests that, eventually, people are likely to mimic the way they saw their parents handle money, regardless of whatever advice their parents might have given them.

Learn more in Tightwads and Spendthrifts: Navigating the Money Minefield in Real Relationships

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Scott Rick is a marketing professor at the University of Michigan’s Ross School of Business, where he has won awards for research and teaching. He holds a PhD in Behavioral Decision Research from Carnegie Mellon, where he was a National Science Foundation graduate research fellow. His research on consumer behavior has been covered in outlets such as The New York Times and The Wall Street Journal. He has published in premier journals spanning marketing, psychology, and economics.

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