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5 Steps to Successful Budgeting as a Couple

How to create a spending plan you both can live with

Illustration of a man and woman tugging at a big wallet full of money from opposite sides
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A well-conceived, well-tested household budget plan is the cornerstone of any sound financial strategy. Without this important tool, it’s difficult, if not impossible, to work toward a happy and secure retirement.

Now may be a good time to create that plan or revisit the one you have, especially with inflation at a 40-year high. Supply-chain issues and the war in Ukraine are also increasing the uncertainty about prices of goods and services.

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If only you could convince your partner of the wisdom of making a budget. As hard as you try, the two of you just can’t seem to agree on how to allocate the resources you have between you.

“Most of my couples have a saver and a spender,” says Tess Zigo, a certified financial planner (CFP) at Emerge Wealth Strategies in Palm Harbor, Florida. “In my marriage, I’m the saver, focused on long-term priorities. For us it’s a good balance because my hubby reminds me to spend on things we enjoy today, because life is precious and limited.”

Often, however, agreeing on a budget is easier said than done, says Sergio Garcia, a CFP at BFS Advisory Group in Dallas, Texas. “Everyone has their own history and experiences with money,” he says. “We develop notions around how what it means and how to use it. This leads to different priorities and feelings, whether we realize it or not.”

Is all lost? Not if you can begin to “talk money with your honey,” says Bob Wolfe, a CFP at RegentAtlantic in Morristown, New Jersey. “When we find a misalignment with a couple’s spending priorities, we revisit what’s most important to them individually and reconcile those differences.” Then you can move toward creating a budget and an overall financial plan while safeguarding your relationship. These suggestions can help.

1. Talk, don’t assume or shut down

First, a reality check. Make sure that you know for certain what your partner thinks about money. Avoid assumptions, as that’s how misconceptions arise. Nor should either of you take the easy way out and shut down. In the Fidelity study, 24 percent of respondents said they are often frustrated with their partner’s money habits but let the problem go to keep the peace. 

Open, honest communication may not happen overnight; you may have to work toward it. While this process may be tricky, under the best circumstances, it can lead to a greater understanding and more compassion on both sides.

2. Admit when you need help, and find it

If you’ve been hitting a wall, then seek advice from a third party. A certified financial planner who’s willing to mediate and is adept at dealing with conflict can create the space for you to discuss your feelings, as well as draw out important information when one of you isn’t volunteering it. “This unbiased individual could be a therapist, coach or financial planner, depending on the circumstances,” says Marguerita Cheng, a CFP at Blue Ocean Global Wealth in Potomac, Maryland. The Financial Planning Association has a tool to help you find a planner in your area.

Ideally, you’ll begin to develop a unified vision so you can set joint goals. Partners who work with a financial adviser are more likely to find it easier to start money conversations, agree on a vision of retirement and feel confident about their financial health. You may want to look for a financial therapist. Members of the Financial Therapy Association are psychologists, marriage and family therapists, social workers, financial planners, accountants, counselors and coaches. 

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3. Get down to the nuts and bolts

Let’s assume — and hope — that you and your partner are on the same page. Now it’s time to rough out your budget, so you can keep tabs on where your money is going, determine how much is left over at the end of each month and adjust as needed. This will enable you to meet other goals, such as reducing debt, feeding your emergency fund and investing for retirement. Consider these four steps.

  1. List all sources of income: earnings, interest, dividends, annuities, Social Security benefits, pensions, IRA distributions and any required minimum distributions (RMDs) from each of your retirement plans. 
  2. List your fixed expenses: the necessities, including rent/mortgage, utilities, insurance, car loans, credit cards, medicine. 
  3. Subtract your income from expenses to determine your balance. If you have nothing left or you’re in the red, rework your budget or adjust your lifestyle accordingly. You may need to move to a cheaper home, find a job that pays more or look for a side gig.
  4. Track your flexible spending (money you allot for takeout food, online shopping, travel, and streaming movies and music) using one of the simple apps that are available. 
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Honeydue, an app for budgeting with a partner, allows you to sync bank accounts, credit cards, loans and investments, if you choose. You can categorize expenses and set up monthly limits on each; you’ll receive an alert when you or your partner is nearing it. Honeydue will also remind you when bills are due, and you can chat with your partner, using emojis to ensure that your intent is understood. Mint is another budget planner and credit-monitoring tool. NerdWallet has a free app you can use to track your spending, your credit score and your net worth. AARP has an online budgeting resource, too.  All are free. 

4. Think yours, mine and ours

As you track your flexible spending, Cheng warns against making your budget too limited and suffocating for your partner, as this may make the plan a point of contention, complicating your relationship. Realize that each of you has individual needs, interests and priorities, as well as goals as a couple. 

If you’ve married later in life, or for a second time and have blended your families, you or your partner may think that too much cashflow is being directed toward priorities that compete or are unnecessary. Your budget needs to allow for these differences. “Thinking yours, mine and ours can be helpful. That can apply to hobbies, as well. One spouse may be into cars. The other may think that’s frivolous and expensive,” Cheng says. 

5. Make room for fun

How, exactly, do you make that work? Create a discretionary category within your budget, suggests Niv Persaud, a CFP and certified divorce financial analyst (CDFA) at Transition Planning + Guidance, LLC, in Atlanta, Georgia. Your overall spending plan, she explains, should cover all essential expenses plus amounts for nonessentials that you both agree on, such as gifts, travel and entertainment. When you disagree, discretionary funds can be used to supplement this spending category. 

Let’s say that your plan has an agreed-to amount for spending on adult children. Whenever you or your partner exceeds this amount, draw the extra funds from your personal discretionary account. “This concept also works well when you disagree on how much to spend on golf, shopping and trips to the spa or salon,” Persaud says. 

Note to self: The purpose of toughing it out with your partner to create a workable budget is to help you prepare for a joint secure future. But it should also make it possible for you to enjoy your lives to the fullest.

Patricia Amend has been a lifestyle writer and editor for 30 years. She was a staff writer at Inc. magazine; a reporter at the Fidelity Publishing Group; and a senior editor at Published Image, a financial education company that was acquired by Standard & Poor’s.

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