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The union of two souls is aptly encapsulated in the vows many promise each other – for better, for worse, in sickness and in health, for richer or for poorer. But at the end of the day, a marriage is a contract in which both parties negotiate the rest of their lives together.
A healthy relationship can be defined as one where two people strive to help each other become the best versions of themselves. How would one achieve this when it comes to managing personal and joint finances as a couple?
Historically, women have often had to give up their roles in the working world to care for the household and their families, while relying on their husbands as the primary breadwinner.
According to the World Bank, “In Sub-Saharan Africa, marital power can be traced back to legacy legislation brought to the continent by colonial powers, it was seen as a ‘law of nature’: because men were considered wiser, women should be subject to their rule.”
The turn of the century has given women more access to financial independence with more opportunities granted. However, speaking about the handling of finances is something that many couples still seem to avoid, with some still considering it a taboo topic to discuss.
Staying open, transparent and setting financial goals with your partner is arguably one of the most important conversations couples need to have when planning their lives together. Dulcie Weyks, a financial advisor from PSG Wealth, shares with us some tips on how to find the balance between relationships and money:
- Commit to honesty and transparency
Truthfulness and sincerity are the basis for any healthy relationship. Making sure that not only your partner is aware of your financial situation and goals but also that you have a plan to carry them out is imperative for maintaining financial freedom.
“The first step is to have an open and honest discussion with your partner about your finances, whatever circumstances you may find yourself in. Keep in mind that your habits and attitudes towards money could differ a lot depending on your respective childhoods.
“Once you understand how you both approach money management, it will help you to determine the best way to manage your financial journey together. You should also address tricky questions like credit score, any debt, savings and salary,” Dulcie explains.
- Set your financial goals and priorities together and individually
Talking about the goals you have for your future – individually and collectively – will give you something concrete to work on. Dulcie advises that you ask yourself and your partner questions that will provide a clear picture for the kinds of financial goals you’d like to achieve, such as do you want to budget for travelling the world? Are you looking to buy a home in five or 10 years? When would you like to retire?
“Having savings goals is important because it helps you to decide how much money you both need to save and where that money is best invested. If, for example, you are planning to buy a property in two years’ time, it would be wise to invest this money in an accessible savings or money market account. This way, you won’t have to wait for the market to turn in your favour when your dream house presents itself.
“For long-term goals, like retirement, you might want to consider a more aggressive approach by investing most of your money in equities. This will give your money the opportunity to grow over the long term, helping you to reach your goals.”
- Budget and stick to it
Once setting your individual and joint financial goals and identifying your sources of income, putting together a list of your personal expenses and ones to be incurred as a couple is next on the list.
Dulcie says, “Decide how you will split your expenses and remember to set spending limits and savings expectations. Always keep your own separate bank account but consider opening a joint account for shared expenses.”
- Plan for emergencies
It is always better to be safe than sorry, as the saying goes. To ensure financial freedom, have your own separate bank account or ‘rainy day’ fund for whatever surprises life may throw at you.
“Loss of employment, medical emergencies and facing a pandemic are examples of these unexpected events that can be stressful and costly. A good goal is to save three to six months’ worth of the expenses that you each are responsible for,” she explains.
- Structure your financial plan
If you want to build a house, you need to have a plan and blueprints. The same goes for having a financial plan if you hope to ensure independence and reach your goals. Dulcie advises that couples and individuals take the time to partake in a financial needs analysis.
“A financial needs analysis (FNA) is an overview of your current financial situation, your future financial needs and goals and what you need to do to reach these goals. This includes retirement and estate planning as well as risk insurance such as death, disability, and critical illness cover.
“Getting married means stepping up your retirement efforts. You each need your own individual retirement fund and you need to contribute to them regularly. This is also a good time to think about drawing up a will. A will ensures your money and other assets go to the right people and that your wishes are carried out.”
- Set yourselves up for success
Don’t let money woes be a sore spot in your relationship. Keeping an open and non-accusatory line of communication is imperative for future success in your personal goals and what you hope to achieve as a couple.
Dulcie ends off by telling us that, “Tackling your finances as a couple can help you to avoid quibbles about money and to reach common goals. Getting started isn’t always easy. A qualified financial adviser can help you to build a financial plan that works for you, so you can feel confident that you’re on the right track.” (www.snl24.com)
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