However, many people are clueless when it comes to their family's financial situation.
According to a survey taken by Fidelity, 43% of respondents don’t know how much their partner earns and 36% are unaware of the amount they have invested.
Then, there are the financial horror stories where one spouse has hundreds of thousands of dollars of debt and the other spouse doesn't even realize it. Or, one spouse thinks the family is financially sound, when in reality the truth is the exact opposite.
There have been many times when someone has told me that they had no idea what their monthly mortgage or rent payment is, they don’t know how much they are putting towards retirement, they are unaware of the debt they have, and so on.
Even more shocking, some can’t even give me an estimate and have no clue whatsoever about what the amount would be. Or, when they do give me a number, their significant other chimes in about how wrong they are.
Sadly, this is surprisingly common.
Just because it's common, doesn't mean it's a good thing. It's not good at all!
Below are my top tips for successful money talks and family budget meetings.
Money talks and budget meetings can be helpful in many ways.
A family who has regular money talks and budget meetings is more likely to be financially successful and happy than a family that doesn’t.
There are many ways conducting regular money and budget meetings and being aware of your financial situation can help you.
- You can work together and succeed. Together, you can tackle your financial situation and are much more likely to have a positive outcome when you are both putting effort towards your goals.
- A lack of money communication can lead to financial infidelity. According to an article on Forbes, 20% of those in the U.S. keep financial secrets and 7% of people between the ages of 18-49 have a secret bank account or a secret credit card they keep from their partner. Read more at Financial Infidelity And The Problems It Can Create.
- Knowing your financial situation will help you keep a budget. By knowing your financial situation you can create and keep a budget that works for you. You will know more about the amount of money you are spending, whether you are living paycheck to paycheck, and more.
- Being aware may prevent everything from falling on one person. Everyone should be aware of their financial situation. It's not fair for one person to manage it all, and you would be in for a rude awakening if something were to happen to that person.
- Being involved can help you with your family's goals. It would be quite difficult for a person to work towards their family's financial goals if they weren't aware of the financial situation they were in. Being involved can help keep you motivated and know what's going on.
- Regular money talks can lead to less fighting. When you are open about money in your relationship, you are less likely to have financial surprises and money fights. Both of you will be aware of what's going on when regular money talks and budget meetings are conducted.
Many different things related to money can be discussed.
In your budget meetings, you can discuss:
- Your financial goals.
- Money values.
- How the family is doing financially.
- What changes need to be made.
- What the family's budget is.
- When, where, and how much is needed for retirement.
- Any financial problems, and so on.
There is no right or wrong answer as to what should be discussed in a money meeting.
The key to a successful meeting is that both of you are up-to-date on what is going on so you can work together towards your family’s financial goals.
You may have different opinions.
Everyone has a different opinion about everything.
So, there is a chance that you and your spouse have different feelings about certain money topics and situations. However, that does not mean it's the end of the world.
You should be open to what your spouse has to say and work together towards finding a solution.
Plus, if you have widely different money views, this is a big reason why you should have regular money talks. Without talking about money, there is a chance that you don't even know or realize what your spouse thinks about a certain money situation!
Money and budget meetings should be held regularly.
Regularly communicating about money is an important step for every relationship. Being open about your financial situation can help prevent any surprises, it will ensure that both people in the relationship are aware of what’s going on, and so on.
You and your partner should sit down once a week, once a month, or whatever timeframe works best for the two of you. You may want to try out different lengths of time to see what does and doesn’t work.
Personally, I do not recommend going months at a time without talking about money. Too much can pop up in that length of time. Plus, money talks and budget meetings do not have to be excruciatingly long. They can be as short as 10 minutes, so there is no reason to not have them regularly.
Do you talk about money with your family? How often do you have budget meetings?