Many elements can lead to relationship tensions and even breakdown.
One of the most difficult to change can be disputes or differences over money.
Perhaps strangely, often ‘opposites’ attract when it comes to money and relationships.
“You’ll often see a spender/saver dynamic in a couple,” says Lea Clothier, a Behavioural Money Coach.
The reason for this can be based on deeply set value systems. Money can be tied to, for example, freedom, security, or success.
“Money can represent all three to us, but we often have a dominant main value system around it,” says Ms Clothier.
Value systems and money
Understanding the underlying values in your relationship will give us insight into our behaviour and what is happening when there is tension over money.
Someone who sees money as a means to freedom is likely to be more of a spender, Ms Clothier says.
They are also less likely to stick to or use a budget (which they find restrictive). They may enjoy spending money on experiences and enjoying life.
On the other hand, someone who sees money as all about security may use their money more restrictively.
They are likely to be more savings-focused, manage money more tightly, and stick to a budget.
‘For these people, having a cash reserve gives them peace of mind and reduces financial anxiety,’ Ms Clothier says.
Those who see money as a measure of success may display their wealth through their choice of career, the car they drive, and the clothes they wear.
They may have big financial goals and see money as the tool to achieving these, Ms Clothier says.
Money is likely to be at the centre of or influence many of their major life decisions.
Conflict over money
Four in ten Aussies in a relationship have experienced financial stress in the last 12 months, and women are suffering more, 45% compared with men at 37% according to the February 2023 research conducted by Money.com.au
Nearly half (45 per cent) admitted it had negatively impacted their relationship.
Specifically, a third (34 per cent) admitted their relationship had been negatively impacted, while 11 per cent indicated it had not only had a negative impact but had caused them to discuss breaking up with their partner.
Conflict can happen in partnerships and relationships when people have conflicting money values.
Imagine a relationship where one person is freedom-focused and the other security-focused.
The actions one person takes could be seen to compromise the other’s need for freedom or security.
Where money values are fundamental to us and clash with someone else’s equally strongly held beliefs, conflict seems inevitable at some point.
Understanding each other’s values around money can help reduce conflict and diffuse conflict.
“Many couples don’t manage money together as a team,” Ms Clothier says.
Getting ‘on the same page’ financially means both are taking an interest in finances in the relationship. Ideally, both also have an active role.
Ultimately a shared household spending plan is a great idea, so both partners work together towards joint financial goals.
Keeping some financial independence is also a good idea, perhaps in the form of having a small amount managed separately, so each can choose to spend independently of common money goals and actions.
But this should be transparent: any habit of hiding money will undermine trust.
Financial stability, relationship stability
Financial stress and financial instability are leading causes of stress globally and often contribute to marital and relationship breakdown.
Improving our sense of financial security and stability provides peace of mind and invariably helps to steady many partnerships, Ms Clothier says.
“It can create a platform for individuals to pursue their dreams and for a couple to achieve shared goals,” she said.
Financial stability is also the foundation for a stronger financial future and makes goals and dreams more affordable.
Financial stability is created through two essential elements: communication and cash flow, Ms Clothier says.
Money is a very emotional topic, which can make communicating about it difficult.
Learning to be open and transparent about money matters and communicate clearly about them is essential to remove the tension that money often causes in relationships.
Managing cash flow is the foundation of all financial plans.
“It’s about being mindful of every dollar that flows into your life and intentional with the very dollar that flows out,” says Ms Clothier.
When we have a system and process in place to manage our cash flow and ensure we are spending less than we earn, paying off debt as quickly as possible and building a cash buffer, we can begin to focus our attention on growing our wealth investing it.
Many people go straight to the investing part, only to find they are building on a shaky foundation.
If you are doing this, seek some help getting your fundamentals right – improving your cash flow situation to spend less than you make.
The dealbreakers of money and relationships
A major dealbreaker regarding money that will undermine a relationship, perhaps surprisingly, is poor communication.
Even worse is lacking transparency – which to a partner can quickly erode that most important element in any partnership: trust.
This applies to all stages of a relationship – including the beginning of one.
A partner with an undisclosed historical debt is a partner with a burden that can harm a relationship.
Hiding purchases and spending habits and having secret stashes of money will also destabilise a relationship.
Teamwork and shared responsibility regarding joint finances are essential. It’s constructive, but its absence is a big negative.
Working together on a joint budget, a spending and saving plan builds a sense of partnership – and trust because the goals are shared. Both partners can enjoy the feeling of achievement that comes from successful planning with structure and clarity.
If there’s debt, work out a debt management plan either together or with complete transparency.
“Lacking a plan means that our finances often control us, rather than us controlling it,” Ms Clothier says.
“It also means we are less likely to achieve our goals and dreams because we don’t have the means or method to achieving them.”
Another huge dealbreaker is procrastination.
So many typical money milestones fall on a particular date, so that that avoidance can be very costly.
So don’t put off paying the credit card bills or the insurance – that will create tension in a couple and family.
This also applies to investment. The saying goes: the best time to invest is yesterday and the second-best time is now.
Some regret over financial behaviours and decisions is inevitable and painful, but communication over shared goals can help prompt action rather than avoidance.
Another look at communication
In countries where the cost of living is high, money is one of the most emotive regular topics we face.
Shame, guilt, fear, anxiety, jealousy – all big emotions – are all common around money.
We can feel anger, too and even slip into useless or even damaging fantasies over finances.
And most of this happens in one place – inside our heads.
Learning to be open and transparent about money matters and communicate clearly can remove significant triggers for tension and disagreement.
It’s important to remember that a lot of financial behaviour is habitual.
“Most of us don’t bring much awareness or mindfulness to what we do with our money on a day-to-day basis,” Ms Clothier says.
Our money habits, particularly negative, can be detrimental to our finances and cause conflict in a relationship.
If you or your spouse notice some unhelpful financial behaviours, it’s important not to launch into judgement, blame or attack. Instead, offering support to see what is driving the habit or behaviour is more beneficial.
It’s important to explore – with honesty – if there are ways that one or more bad money habits, we have either individually or as a couple could be reduced or replaced with something healthier.
Suppose money is a source of regular conflict in your relationship. In that case, it may pay to consult with a financial counsellor, money coach or financial adviser who could support you to get back on the same page with your finances.
Often, they can provide perspective, an objective view, great support and practical tools to work together and master the art of managing money as a couple.
It’s important to note again that money challenges can reveal significant underlying issues, such as the need for security, freedom, or success.
Suppose the behaviour of one or other partners in a relationship is controlling or obsessive in pursuit of these values, leading to major relationship clashes. In that case, marriage counselling or couples therapy might also be helpful.