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Empowering your money

Money mistakes young couples make

Too many money disasters are told over drinks to friends who offer plenty of support but can't do much to help with the problem. Often the couple in question have already split up and are older and wiser.

Sometimes they have learned their lesson and made a plan for better using their finances. Sometimes they haven't. Sometimes they repeat old mistakes over and over until death parts them from what little they have left.

Here are some common mistakes that couples have regarding their finances:

  • Not having "the talk" early on. Not communicating early can set up a pattern of avoidance that leads to problems down the line.

  • Not communicating regularly about money issues. Not communicating regularly is the downfall of a relationship in many ways. New concerns and conflicts arise naturally over time; if they are not addressed, they can turn into festering sores. Worse, they might get tackled via underhanded forms of manipulation.

  • Not having clear goals with clear methods of achieving them. Not having clear goals and an action plan can result in money getting wasted. It can also result in fights and misunderstandings. Having clear goals requires regularly communicating with each other.

  • Not having a budget. This is one of the most common mistakes. Not having a budget can lead to problems not just right away, but even years into the future.

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Make sure you and your partner have a set budget. (Photo: VISYT Digital AG via AP Images)
  • Keeping money secrets. Money secrets include having plans that you do not share with your partner. They also include keeping hidden stashes of money and/or incurring expenses that you hide from your partner. There are often amazing rationales for these secrets, such as "What he doesn't know won't hurt him" or "Believe me, it'll prevent worse problems down the road." Perhaps. But money secrets violate the spirit of honesty, involve manipulation, and can blow up after years of guarded secrecy.

  • Playing control games. This isn't just about one person taking charge of the finances. That may have value as long as it is agreed upon and communicated well. Control games are an underhanded way of addressing perceived power imbalances in a relationship. They can include denying a partner money in subtle ways or keeping unspoken strings attached to small loans, for example.

  • Not planning for emergencies. You should acknowledge that emergencies will arise. If you are not prepared for them with a means of paying, they can cause major strain, on top of the usual emotional and monetary stresses. Set up an emergency fund with up to six months' expenses. Add to it however you can until it is set up (a budget will help). Keep it in an account that will not lose its value.

Dive deeper: How to manage money as a couple

This content was created in partnership with the Financial Fitness Group, a leading e-learning provider of FINRA compliant financial wellness solutions that help improve financial literacy.

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