Building a life with another person is hard enough when money isn’t involved. You already have so many differences to work out, and so much work to do to communicate well. Even if you were both to agree on absolutely everything you want, it just wouldn’t be possible to do it all. And in today’s economy, you’re lucky if you can get by on two incomes, let alone live your dreams.
But there are still ways that you can work with your partner to go after the things you want. And with good planning and smart budgeting, your chances of seeing some real success are even higher. That said, it takes certain skills and conversations to get financially aligned with any partner. Here are three ways to get off on the right foot for strong financial alignment with your partner.
1. Maintain Open Communication
The key to financial alignment in any relationship is openness and honesty from both partners. But even with the best of intentions, many couples struggle to share fundamental truths about their finances. Or, they have a hard time sitting down and talking out their views on finances and budgeting. Either way, it’s hard to build together when you can’t have these basic conversations.
One major theme is a discrepancy between how much information each partner feels should be shared. For instance, one person thinks all major purchases should be discussed between both partners. The other thinks, “Well, it came out of my paycheck, and that’s my money to spend.” What one partner perceives as a normal level of independence may come across to the other as deception.
For instance, imagine Jorge and Shiyara are a young married couple living in Los Angeles. They each have separate bank accounts, plus a shared checking account they use for certain expenses, like rent. One day in April, Shiyara is speaking to their tax accountant, who asks if they have any investment in cryptocurrency. She says no, but, unbeknownst to her, Jorge has about $5000 invested in Bitcoin.
It’s not that Jorge wanted to deceive Shiyara, it’s just that it didn’t occur to him to tell her about his Bitcoin investment. He made it with a small amount of inheritance he got many years ago when his grandfather passed away. But now, not only does Shiyara feel betrayed, but the two of them owe a penalty on their taxes. This could’ve been avoided if they’d only sat down and discussed their finances together.
A lot of issues come up suddenly when couples prepare to make significant financial decisions or changes together. For example, according to Truework.com, many major life events require people to go through an income verification process. At times like these — such as applying for a mortgage or filling out a rental application — secrets can come out. It’s always better to discuss finances openly with your partner beforehand, so there aren’t any surprises.
2. Set Shared Goals
It’s amazing how many couples get involved, move in together, and even get married without really discussing their futures. They try to build a life together, without doing the very basic legwork of deciding what it is they’re actually building. If there’s misalignment between partners’ goals, it can breed major problems with both the relationship and with finances.
For example, imagine a younger millennial couple, Sam and Elian, who’ve just moved in together. They’re both in love and they know they want to form a family together, but their priorities are different. One wants to get married and have children right away, while the other wants to backpack the world. In a perfect world, they’d take a gap year now and start trying for a baby when they get back.
But they don’t live in a perfect world. And they don’t make nearly enough money between them to do both things within the next five years. Choosing one partner’s dream would mean forfeiting the other’s, potentially forever: an impossible dilemma. But many, many couples don’t consider the actual financial realities or the compromises they’ll have to make.
That’s why, when you start to get serious with someone, it’s important to have these talks right away. Decide what each partners’ non-negotiables are, and do the math on whether it’s possible to make them both happen. Even if your future and financial goals are closely aligned, there could still be major differences in details or timelines.
If you do see eye-to-eye, start getting specific about what exactly it is you both want. For instance, if you know you want to buy a house, discuss location, size, style, etc. Determine together how much of your incomes you actually want to spend on housing. Getting super clear on your mutual vision of the future can ward off a lot of potential conflict and disagreement.
3. Create a Budget
Once you and your partner are completely aligned on your financial goals, you can start to hammer out the details. First, you’ll calculate how much you’d need to save in order to get whatever it is you want. Tally up what it will cost to spend a year backpacking the globe together. Or decide how much you want to spend on a house or sending your kids to college.
Once you have those figures, you’ll cross-reference them with your current income and any savings or investments. You can factor in details like what you project your income will be in several years, with more education or experience. With these details, you can figure out how much to start saving and how much you can afford to spend at present.
Of course, unless you’re an expert mathematician, you’ll have no idea how to do all that. But there are plenty of financial apps on the market that can help you figure out how to attain your goals. They can analyze your current spending habits and determine where to cut costs or what changes to make. One AI-powered budgeting app with a lot of potential is WallyGPT, which can help you set up action plans based on your goals.
As you budget together, make sure you’re aligned on the specifics of this too. For instance, decide how you’ll hold yourselves accountable to your budget, and what you’ll do if one person messes up. If one partner accidentally overspends or the other loses their job, you’ll need to know how to cope. It’s better to make these decisions in advance than to panic and argue in the moment.
You’ll also need to decide how you’ll handle shared expenses within your budget. For instance, decide whether to have a shared bank account or to keep all of your finances separate. Determine whether you’ll split bills straight down the middle or divide them up based on income. Consider whether one person makes significantly more money than the other and if that means they should pay more.
Get Clear On Your Values — But Accept Your Differences
The most important thing you can do to stay financially aligned as a couple is to get — and stay — extremely clear on your values. Knowing what you both want, and staying true to those shared values, can help avoid painful compromises and needless fights. Just as important, though, is knowing and acknowledging where your differences lie. Accepting that you and your partner won’t always agree on every detail will set you up for smoother financial communication.