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Romance & Money

Communicating About The Budget

Arguments about finances

Michelle in Chicago, Illinois:
"Help! My husband and I have been married for only two months now, and we already are having arguments about our finances and how to handle them. He thinks that we should take every extra penny we earn each month and pay down our mortgage. I disagree. I think we should pay our mortgage each month and use the extra income to open an investment account. He also thinks I spend too much on shoes and personal services. I'm willing to cut back, but don't really know where to start.
We both agree that we want to stop arguing but don't really have anyone to turn to for answers. We've agreed that in the interest of our relationship we will go along with whatever you say. We love each other too much to be so torn apart over this issue. Please help!"


Michelle,
You're both right about the finances, and you're both right that if you continue to argue over them, you will be torn apart. Statistically speaking, marriage counselors say that most married couples argue over money, and it's the number one reason for break-ups.
In finances the all-or-nothing approach is not always best. Every extra penny is a bit extreme.

"All extremes are dangerous."
Virginia Wolfe

Divide those pennies and don't forget to put some aside for romance.

Develop an annual budget that compels you to set at least one extra payment aside each year for your mortgage. The budget will give your husband something tangible to look at by the end of each month and he'll see that he's applying monies to the mortgage principal. The budget also will show you how much you have each month to put towards an investment portfolio. The act of investing and watching it grow should be incentive for you to cut back on some (not all) of your personal services.

"I'm living so far beyond my income that we may almost be said to be living apart."
e.e. cummings

Only you can decide what you can live without and how those pennies can better serve your future. By doing all this in the form of a budget, you will be reaching a compromise and will both be able to watch your dreams grow on paper. And your husband will see where you are cutting back. Hopefully, this will satisfy both parties and all financial concerns.

Review and revise annual budgets.

I'm a big believer in diversifying your monies. Before you open any accounts or pay extra on your mortgage, make certain there is no debt. If you have any credit card debt, then the best thing you can do is to pay that off first. Set aside a minimum of six months living expenses as a cushion in case of an emergency.
When all of that is done, then and only then, start an IRA or 401K and invest regularly.

If you have all that in place, and are comfortably investing regularly, carry no debt and have liquid cash for a six month period, then start paying extra on your principle.

Additional information on this topic:


Read Earlier Articles
Editorial Calendar & Monthly Budget Worksheet
Important Financial Help Websites and Phone Numbers
mindy@overcoffeenotary.com

 

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