“Honey, We Need to Talk . . . About Money”

Even money experts commit financial infidelity.

Scott Palmer admits the biggest financial mistake he made was when he “cheated”  on his wife, Bethany, 14 years ago by gutting the kitchen in their house without telling her he was planning to do so. It was the first of many moments when they had to decide if they were going to let costly miscommunication jeopardize their finances and their relationship, or bring them closer.

They chose the latter. Now the Palmers are “The Money Couple,” financial planners in Colorado Springs, Colorado and authors of First Comes Love, Then Comes Money, a guide to financial communication that helps couples avoid money pitfalls that can ruin relationships.

“Whenever clients came in to announce they were getting divorced, it was usually because of money,” says Bethany. “When it came to financial relationships, they focused on their retirement plan, but not the day-to-day decisions that involved money.” She says that 70 percent of divorces are due to financial conflict, but it’s not about the long-term financial plans, it’s due to everyday bickering. “There’s a money component to every daily aspect – eating out, getting gas, buying shoes. If we don’t understand the lens through which our significant other sees money, no wonder there’s so much conflict.”

Having the money talk

The Palmers’ first recommended step towards marital and monetary bliss is to have “the talk” about debts, expectations and goals. Ideally you should do this before you move in together or get married.  Don’t have fear that an in-depth discussion will douse the flames of romance. Instead, think of it as a serious truth talk that will help you love and respect your partner even more for opening up about a tough topic.

Some of the questions to ask each other:

• -How did your mom and dad spend and save money?
• -Do you think joint and separate checking accounts are appropriate in a marriage?
• -Do you think paying the bills should be done separately or together?
• -Should we consider a prenuptial agreement?
• -What stresses you out when it comes to money?
• -How important is planning for retirement to you?

What’s your money personality?

The next step in understanding your partner’s stance on money is finding out what his or her Money Personality is.  The Palmers say that 65 percent of couples marry their money opposite, so knowing how proactive and reactive each person is about financial issues makes your day-to-day money tasks and talks easier and less riddled with stress.  The five Money Personalities are:

• -Saver – penny-pinchers who hate parting with money
• -Spender – they love to buy, buy, buy for themselves and for others
• –Risk Taker – the personification of entrepreneurs, inventors and business trailblazers
• –Security Seekers – financial planners who like to have all their ducks in a row and lock in their financial futures
• –Flyers – artistic types who prefer never to think – or talk – about money

“If you understand the way the other looks at money, you’re ahead in the game,” says Scott. “But if you don’t understand each other’s Money Personality and why he or she does what he does, you’ll have a tough time. And the problems could continue if you move on to a new relationship.”

Make the money huddle a habit

The third step – and the one to follow regularly – is to commit to having a money huddle on a regular basis. This means making room in your schedules for having a regular conversation about money. The Palmers have their money huddle on the 15^th of every month. “We set aside all distractions, even getting a sitter for the kids,” says Bethany. “We sit down to pay bills, look over their spending, and talk about financial goals and dreams. And we have a specific topic every month. In August or September, we talk about Christmas gifts and what the other would like. When we‘re thinking about a summer vacation, we start talking about it in the winter and plan for it in advance.”

Honesty is key in a relationship, and that definitely extends to money. Money secrets are as devastating to a relationship as sexual infidelity.  So if you blow the budget or have a secret credit card, confess and tell your partner so you can work on making changes together.

“What hurts newly-married couples is surprises,” says Scott. “Regular money conversation will save you a lot of heartache. Talk about your Money Personality, then move into the discussions. Identifying and understanding your money differences will help you make a relationship that’s built to last.”

Vanessa Richardson is a freelance writer in San Francisco who writes about small business and personal finance.