How to Achieve Financial Freedom in a Marriage

July 22, 2019

As married couples plan their futures together, it’s important to remember that maintaining individuality is healthy for all relationships. Creating space to pursue our own interests allows us and our partners to be ourselves, reminding us why we choose to be together. 

This same principle applies to a couples’ finances. Developing a common vision while giving each other space to make independent decisions gives us a chance to grow our lives together while making sure we build individual financial security.

So how do we do it? How do we preserve our financial wellbeing as individuals while growing our future together with our spouses?

Plan together. 

When it comes to a relationship, compatibility is often priority #1, and that includes fiscal compatibility. Disagreements about money are often cited as one of the main reasons couples divorce. 

To better understand your partner and achieve a sense of trust, it’s crucial that you communicate about your common goals.

Consider asking questions like:

  • How do we each approach our spending?
  • How do we approach our individual and collective debts?
  • If one of our salaries is greater than the other, how do we want to split our expenses — proportionally or equally?
  • What is our risk tolerance when it comes to our investments?

Coming together to develop an overarching plan — like the percentage you plan to save — allows us to focus on the big picture, rather than each individual choice we make as individuals along the way. 

Consider the value of separate accounts.

Creating a financial plan together while maintaining separate financial accounts can strike a harmonious balance between collaboration and individual freedom. 

Having separate accounts can act as a pressure release. If your partner wants to buy a latte everyday before work, but you prefer to skip the latte and wait for a larger purchase — don’t sweat those different habits. If you find that one person’s spending habits add up in a sizable way, and they steer you away from your agreed upon plan, that’s when you may want to revisit the conversation. 

Even when we do our best, sometimes things don’t go to plan — people change, life happens. In the event that problems do arise, having separate accounts can reduce stress during a breakup. While joint accounts can be hard to disentangle, individual accounts offer a cleaner break and allow each person to manage on their own at the end of the day.

Share the work — all of it.

Divide and conquer may have been effective in the battles of ancient Rome, but marriage should not be a battlefield. 

While each partner will have their strengths, it’s best to make sure that couples share financial responsibilities to attain confidence as an individual and balance as a couple.

When it comes to the household, one spouse may take out the trash, while the other cleans the kitchen. The same goes for finances. One person can handle the car payment, while the other manages insurance bills. 

There are many ways you can slice and dice these responsibilities, but the bottom line is this: when each spouse has a good sense of what it takes to maintain the family finances, you reduce the likelihood of misunderstandings and arguments. Likewise, having a good handle on the finances will make you feel more secure in the event of a spouse’s death or a divorce. 

Discuss the path toward financial independence.

Paving the way toward true financial freedom requires thinking about financial independence — that is, earning enough income to pay your living expenses for the rest of your life without needing to be employed or dependent on another person.

Consider a few ways you could work towards a relationship in which each person becomes financially independent:

  • Split your expenses based on a percentage of your income. For example, you might agree that each of you will contribute 30 percent of what you earn towards your mortgage. That way, each spouse is paying what they can afford.
  • Contribute to one spouse’s retirement accounts. If one spouse has less invested in a retirement account, the other can boost their spouse’s retirement by making contributions. 
  • Help pay down debt. Long-term debt like student loans can make achieving long-term financial independence more difficult. Helping reduce or eliminate a spouse’s debt can provide an invaluable sense of freedom.

Remember, contribution is not the same as control. If you choose to have separate accounts, remember they are separate for a reason — they create space for you both as individuals. If one spouse contributes to another spouse’s account, make sure that you talk about these contributions so you clearly understand one another’s point of view.

Believe in yourself. You’ve got this.

Like marriage, developing financial independence takes thoughtfulness and patience — and it can also be exciting! After all, you’re crafting your future and the life you want to live.

Let’s talk about you and your financial future.

Singer Wealth Management