Couple earns $28,000 a month but constantly fights about money
Ellen and Edward earn $28,000 a month, or about $336,000 a year; That’s more than three times the size of their home state of Hawaii. median household income.
They told money expert, author and millionaire Ramit Sethi that their high income did not prevent the couple from having constant financial disagreements. last episode From the Money for Couples podcast. Surnames were not used.
They said Edward feared returning to a bad financial situation similar to the one he had growing up in, while Ellen wanted the freedom to spend their money sensibly without asking for permission.
“We’re in pretty good shape financially, and my brain doesn’t calculate that,” Edward said on the podcast. “Everything is a fire to me. A flat tire worth $200 to $300 is a big deal to me.”
And not just emergencies. Edward manages all of the couple’s finances, and Ellen said she has to get his approval to buy almost everything, even everyday beauty products or essentials like prenatal vitamins.
“Every time I ask for something… I feel like I have to over-explain why I need her to say yes,” Ellen said. “Always saying ‘let me ask’, ‘let’s see what he says’, ‘let me explain in detail why I need this’ is not a good feeling.”
Here’s why disagreements continue and Sethi’s advice on how they can better manage money together.
How to manage money as a couple?
Sethi said Ellen and Edward weren’t bad partners. “Most likely, [a] “poor structure” in how they manage their money.
The couple understands some basic concepts Setting up a financial system that works for both is like the idea that they should have money dedicated to discretionary spending, Sethi said. But Edward includes items like prenatal vitamins in Ellen’s discretionary expenses, which Sethi is adamantly opposed to.
“You don’t just need a better budget. You probably don’t even need one,” Sethi said. “You need a better system built together.”
To help both partners start feeling better about money and hopefully lead to fewer disagreements in the future, Sethi offered three tips — and anyone in a similar situation can follow them.
1. Encourage your partner to take care of your finances
In Edward and Ellen’s case, Edward manages all the money while Ellen has no involvement. However, Sethi said both parties as spouses and co-parents should be treated equally.
Sethi suggests that the partner who has more experience managing the household budget (in this case, Edward) encourages the other to get involved as well. He recommends telling yourself from “day one”: “I’m not going to do this on my own. I want my partner to be good with money.”
2. Talk about money regularly
In the past, Ellen avoided money conversations because she felt like her needs were being ignored and didn’t understand where Edward was coming from when he worried about their finances.
Having regular money conversations can help clear up miscommunications going forward and allow both partners to feel empowered to make decisions about how the family spends their money, Sethi said.
3. Find a structure that works for both partners
Ellen and Edward’s current system, where Edward approves all of the couple’s expenses, is not working for either of them. Sethi suggested that they move to a new structure together.
One idea: They could each have “no questions asked” and a joint account and work together to decide how much money to spend on each, Sethi said.
Additionally, they should also establish some general rules regarding money in their relationships; for example, a debt-free policy or a limit on how long they can spend flipping a house, which has been a point of contention in the past.
Sethi said the couple needs to make a more concerted effort to work together and create a shared vision for their money, otherwise they “will forever feel resentful, behind, insecure, unworthy, misaligned, sometimes even compromised with your finances.”
“Money is important,” he added. “My wish from you is that you show him the attention and respect he deserves.”
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