I met this really nice girl, and we’ve been dating for a few months now. I’m falling for her … but there’s just this one issue. When we first started dating, I told her that she needn’t worry about paying for our dates. I make more money than she does and I didn’t want her to overextend herself. We’ve had a lot of fun going to dinner, drinks, plays, weekends away, etc., most of which I’ve paid for (happily). But then we went shopping for bicycles to explore San Francisco together. Abby, I was totally surprised when she bought a fancy bike. It was over $1,000! Now I see that she’s got plenty of dough, but I guess she just hasn’t wanted to spend it on me. My feelings are hurt. What do you think I should do?*
Clearly this girl isn’t willing to give as much as take. I’m afraid my recommendation is to move on and find someone who will suit you better.
The above is a true story, pulled from the annals of my own life. Since I lived this story and its aftermath, I am well situated to translate its various life lessons:
#1 Come on people, there are at least two sides to every story. It’s stupid to rush to judgment based on only one perspective.
#2 And, holy mackerel, you’d have to be an idiot to look to Dear Abby, MSNBC, Oprah, the Lifetime Channel or any other media source or personality for advice on your life. Those people don’t know you. They don’t know your girlfriend. And they definitely don’t know her side of the story!
#3 Talk first, understand second, act last.
So what really happened, in real life? Well, I am very happy to report that I did not ditch my girlfriend. In fact, I ended up marrying her. But I also didn’t follow Life Lesson #3 as well as I should have. My immediate reaction was to overreact. I let my hurt feelings take control, and we had a fight. A big fight. Right around the corner from the bike shop. It was an ugly, terrible fight of the sort that I’m glad we don’t have very often. But in the end, it was good that we had that particular fight. Because in being angry with each other, we let our honest feelings and thoughts out, and we learned a little more about each other.
For example, I learned that my girlfriend had never been happy with letting me pay for most of our dates, and had only agreed because I was pushy in our initial discussion and she had heard in my voice a tone of “will brook no argument.” And, although she thought it was stupid and unfair, she was never ever going to bring it up or suggest a change because (1) she didn’t want to call forth any further unpleasant arguing and fiery eyes, (2) she was, in general, a bit intimidated by me, my profession and my seeming financial savvy, and (3) as it turns out, she was completely and totally uncomfortable talking about money. For her, the whole topic was fraught with negative history and emotion and her preference was to avoid talking about finances altogether.
But I’m a talker. Avoiding doesn’t work for me. It makes me nervous to have things unsaid. I get insecure and weird and pick fights in public places.
And, in one half-hour battle, with our brand new bikes laying in the sidewalk, we figured out these essential truths about each other, and then, in subsequent months and years, learned how to build them into our relationship.
None of this came naturally. At first, I had to pretty much force her to talk to me about financial matters. But I kept talking and, since she knew it was important, she kept answering. I put bank statements in front of her, asked about her 401(k), spurred the conversation (always a gentle spur though, I learned my lesson on the pitfalls of pushy). When we bought our house, I created an Excel model for our various financing options and made her work through the model and discuss each option with me. I run every single investment idea by her before I buy or sell anything. She probably would have been okay with letting me handle the house financing (she might have even preferred it) and she would definitely prefer not to discuss every 20 shares of GE we buy, but I saw (and still see) all of those conversations as an investment in building our partnership.
As our relationship progressed, we also used our knowledge of each other’s frailties to build an appropriate structure around our joint finances. For example, after our big bicycle fight, it was clear that we both were concerned about maintaining fairness in our division of joint expenses, but that “fair” had different meanings to each of us. To her, fair meant an even 50/50 split of all expenses, but I thought I should pay a greater part of our overall costs since I earned more. After much negotiation, we decided that we would each contribute an equal proportion (usually 50%) of our paychecks to cover our living expenses (in other words, we shared our paychecks equally, rather than our expenses). These days, since neither of us are working, our expenses are borne 50/50 out of our respective accounts (I cover one month’s expenses, she covers the next). This is a structure that works to pay our bills, but more importantly, it works for our relationship.
My wife has come a long ways from the woman who would avoid any financial topic. She reads investing sites. She reminds me that we need to fund our IRAs. She tells me “no” when I suggest a new camera and “yes” when I suggest a new roof. She turns into a hard-ass during salary negotiations.
And, as it turns out, our time was well invested in all those years of awkward conversations. Money is a key element of our off-course life. We find ourselves talking about money, in one way or another, nearly every day. We review our expenditures every month and our investments every quarter. We’ve had to make hard decisions about when and how to spend – what level of risk we’re comfortable with in our investments – how much uncertainty we can handle with regards to future income – how long we can continue living off savings. Being in total financial sync is foundational to maintaining our relationship while on our current jobless path. If we hadn’t spent so much time and effort in strengthening that part of our relationship, any one of the myriad of daily issues could create serious stress or even a rift between us (Did she really just spend $7 on a coffee? Why can’t I buy a wide angle lens? I can’t believe she has both Hulu and Netflix accounts! I better not tell her about going to fancy sushi with my friend. Sheeeit, that SodaStream stock really didn’t work out – better hide that too!).
Most people who ask me for financial advice** seem to expect that I’ll have some hot stock tip or secret bank account or financial app that I can recommend. I don’t. My primary piece of advice is that if you have a spouse or partner, you should do whatever it takes to build a true, complete, equal money partnership with them. This is clearly good for the romantic relationship (there are articles and studies ad nauseum about the damage money issues can inflict upon a relationship), but a more unsung benefit is that such a partnership is good for the finances. It is one instance where ye olde “two heads are better than one” is really true. Even if you are “better” with financial stuff (i.e., have a mortgage calculator in your brain and read the WSJ for fun), getting the benefit of your spouse’s ideas, perspective, judgment and energy can be a game changer. For example, my wife has no interest in researching stocks. But she has a long memory and conservative judgment, and she’s going to remember the $2000 we lost on SodaStream until her dying day. And every time I propose a similarly great “growth story”, she holds my feet to the fire and makes sure I’ve done my research. She’s also great with data analysis, and has built fantastic spreadsheets to keep track of our budget and expenditures. Getting the benefit of her moderating judgment and organizational skill and energy has been fantastic for our finances and was a key factor in helping us feel comfortable leaving our jobs.
So, if you are married or have a partner, quit avoiding the hard conversations. Go slow, be persistent, avoid anger/condescension/deception/judgment/all other bad stuff, talk a lot, and start building your financial partnership. It will be the best thing that ever happened to your relationship or your finances.
* Note: Clearly, this is not really a letter to Dear Abby. I’m using this construct as satire. Or a cultural reference. So, Dear Abby (or Jeanne Phillips, whoever you may be) don’t get all astir. Consider it a compliment or, at the least, free advertising.
** This is a totally misleading statement. Almost no one has ever asked me for financial advice.