Since most of my writing is devoted to how Mr. Frugalwoods and I save money and what we want our money to do for us, I figured folks might like to know how we manage said money in the context of our marriage. I’m writing up a series of posts on the details of our financial management, but I wanted to start with our philosophical underpinnings.
I think that identifying financial goals and long-term plans are the true first steps in financial management. All of the mechanics are secondary. The way Mr. FW and I handle our finances is a microcosm of our overall relationship dynamics. We operate on principles of trust, specialization, and collaboration.
For what’s its worth, I recommend listening to “Home” by Edward Sharpe and The Magnetic Zeros while you read this post. Just ’cause that’s what I was listing to when I wrote it and because I find this lyric particularly apropos: “home is wherever I’m with you.”
The Frugalwoods Approach
Mr. Frugalwoods and I decided to fully combine all of our accounts after we got married six years ago. Of course, we didn’t exactly enter our marriage with any assets, so we weren’t too concerned about discrepancies over who brought what amount to the table. When you’re 24 and only have a couple thousand bucks to your name, it just made sense to throw it all together.
We also didn’t–and still don’t–have any debt other than our mortgage. I know that for many couples, assuming a partner’s debt burden is something that needs to be navigated. If you or your partner has a heavy debt load, I suggest having a frank conversation about whether or not you’ll pay down that debt together as a couple, or if the debtor assumes responsibility for all payments.
How you determine this will be unique to your situation and is something you should analyze together. There are a number of helpful threads addressing this topic in the Mr. Money Mustache Forum community (by the way, if you haven’t joined us on the forums yet, please do!).
Be Team Members
Another factor that made our decision to combine finances very simple is that Mr. FW and I have the same approach to money.
We think similarly about income, assets, saving, spending, investing, and long-term financial and life goals. Mr. FW and I are both a tad obsessed with personal finance (I know you’re shocked), so we’ve always enjoyed discussing our money. But it’s not like we woke up one day with a nearly identical concept of financial stability–we developed it together, before we were even engaged. How? We devoted time and energy to talking about it.
Devote Time To It
Mr. Frugalwoods and I regularly set aside dedicated, focused time to examine our finances. Prioritize your conversations about money. This is not a topic to broach during the heated stress of bill paying or at 11pm on a Sunday night as you’re scrambling to slap PB & J’s together for Monday’s lunch boxes. Have a finance date. I’m not kidding, you guys! Cook a nice dinner, open your boxed wine, and have a relaxing, judgement-free conversation.
Mr. FW and I do this all the time–and not just because we write a personal finance blog–but because our view of money is not static. Like just about everything else in our marriage, our thoughts and plans have evolved over time. The key has always been to keep the lines of communication wide open.
Just as you can’t discuss why you love each other only once, don’t discuss your finances only once. It’s an ongoing, living, breathing conversation. This isn’t to say that your whole life should be centered around your budget and your bottom line, just that it’s something to keep in your rotation of partnership conversations.
Don’t Surprise Each Other Financially
We’re not into surprising each other financially because we feel it’s critical to be on the same page at all times. For example, Mr. FW knows that I adore vintage, art deco sapphire rings. However, I’m secure in the knowledge that he’d never ever buy one as a surprise for me because he knows I’d be madder than a greyhound with a sock on its snout (pictured at right).
I would honestly be furious if he dropped a couple hundred on an unnecessary luxury without my consultation. On the other hand, if one day we spy a ring at an antique store that’s a reasonable price and that fits with our spending goals at that point in time, I’d have no qualms saying, hey Mr. FW, you should buy that for your hot wife.
For us, everything is a team effort and a joint decision. Since our finances are combined, transparency is pretty easily accomplished for us. If you and your partner resolve not to combine your finances, but to share financial goals, think about a practical and respectful way to reveal your financial dirt to one another.
Respect Each Other
We are deeply respectful of one another’s feelings about money. We don’t bully or belittle the other person for making mistakes or not understanding an aspect of our investments. We’re actually harder on ourselves than on each other, which makes for a nice dynamic of communicating when we’re feeling stressed or tense about a purchase we’ve made.
We work to keep things in perspective and acknowledge to each other that our money is not our life. Our life is what happens when we’re not saddled with concern over our finances.
Divide and Conquer
As with almost all other aspects of our relationship, Mr. FW and I specialize in different arenas of financial aptitude. While we both buy into decisions and the general principle of what our money should do, Mr. FW takes care of managing our portfolio of investments. I have no qualms about his leadership in this area because I’m confident he’ll make decisions that are in line with our overall financial ethos.
I, on the other hand, am the “non-digital financial organizer.” I track purchases, expenses, items to be returned, food that’s about to spoil, clothes that need to be purchased out of season at goodwill, and grocery store sales. I’m the more hands-on, household management oriented partner while Mr. FW is the big picture, quantitative, long-term planner and researcher. These skills complement one another perfectly because without Mr. FW, I’d have no investments and without me, Mr. FW would have no pants.*
*This is not hyperbole. The holes in this man’s clothing before we got married had their own zip codes.
I know we’re on the extreme end of this (I feel like I say that about a lot of things… 🙂 ), but, we seriously do talk about nearly every single purchase we make.
This is made considerably easier for three reasons:
- We don’t buy a whole lot of stuff (hint: this is a great place to start on your financial journey!)
- We grocery shop together, ’cause we enjoy spending the time together (Costco date, what what!) and we like hunting out
- We buy almost everything else on Amazon.com, which makes it super simple to review together at home
Communicate About Changes
We haven’t always had the same vision for our future. As our salaries increased over the years, Mr. FW and I had check-in conversations about how we wanted to conceptualize and allocate these new funds. Sometimes we went out for a big celebratory dinner, other times we just clinked glasses of seltzer at home. Either way, we acknowledged our successes and elected how to celebrate in unison.
As I’ve shared previously, we didn’t actually decide to retire early until early 2014. Before that, we were living frugally and saving 65%-75% of our income (we’re at 82% now!), but without a clear destination in mind. We just knew that we never wanted to succumb to lifestyle inflation and we never, ever wanted to be in debt.
I know that everyone’s relationship and journey with money is unique. I won’t pretend to be any kind of expert, but I do hope that our methodology might be helpful to you in some aspect of your relationship with your partner and your funds.
The Frugalwoods Real Quick Relationship Money Tenets:
- Be team members. Figure out what you want out of your life together and how your money can get you there.
- Devote time to conversations about your money. Prioritize your finances as a topic of serious consideration and discussion.
- Don’t surprise each other financially. Be open and honest.
- Be respectful and judgement-free in exploring financial issues together. Don’t make the other person feel badly about past financial transgressions or misunderstandings. Listen to what the other person has to say about money.
- Divide and conquer. Don’t be afraid to specialize in different aspects of your financial management.
- Discuss purchases. Decide if you’ll discuss every purchase or just purchases over a particular dollar amount.
- Transparency. Whether you combine accounts or keep ’em separated, figure out how you want to share your bottom lines with one another.
- Communicate about changes. Keep in touch–don’t talk about money once and then put it on the shelf. Dust that financial baby off on a regular basis.
What are your tips for a financially healthy relationship with your partner?
I also want to add that you’re welcome to email us directly with a question about your relationship’s financial situation. We’re pretty passionate about this (in case you couldn’t tell) and we’d honestly be more than happy to talk through an issue you’re encountering. Don’t hesitate to email me (firstname.lastname@example.org) or Mr. FW (email@example.com).