Fears about finances can sabotage even the strongest of unions – and it’s not just when the bills pile up. Couples who have different spending and saving habits have to learn how to communicate about money or their otherwise happy relationship can quickly hit the skids. Here, Dr. Maggie Baker, a psychologist who focuses on financial conflict and the author of Crazy About Money, explains how men and women often view spending differently, and why money is such a big source of conflict.
Q: Why is money so commonly a source of tension in relationships?
A: Money is as basic to survival in modern societies as food and sex. If a couple experiences a sense of scarcity about money from difficult childhood memories about money, a current job loss or an expensive serious physical condition, the sense of scarcity creates anxiety and fear of uncertain circumstances and uncertain outcomes. In addition, talking honestly about money may bring to the surface underlying conflicts between a couple. Each person has a unique relationship to money. When it is perceived that there is “not enough” money both spouses will revert to his or her own money type, be it a spender, saver or high risk taker. Someone who is comfortable spending in spite of worry will conflict with someone who fears running out of money and thus wants to hoard it. Since money to many was a taboo subject growing up – How many children ask their parents how much money they have and get a straight answer? – they have not developed the skills necessary or often the financial knowledge necessary to talk about money with ease.
Q: What kinds of money problems have the biggest impact on the happiness of a relationship?
A: It is not the specific problem that is critical as much as it is the ability to articulate your own feelings about money and convey them with ease and calm to your spouse or partner. If you have compassion and empathy for your spouse in spite of money differences you will be able to handle most money difficulties. Misunderstanding and feeling criticized, discounted or ignored are common negative emotional states that make any money problem worse. Staying positive and supportive of each other in spite of differences will go a long way to lessen the negative impact of money issues.
Couples can [also] avoid talking about money. In my book, Crazy About Money: How Emotions Confuse Our Money Choices and What To Do About It, the chapter on couples is called, Couples and the Gentle Art of Lying. What I mean by this is that instead of talking honestly with each other about their money behaviour, couples often “shade” the truth or by the “sin of omission” hide what they are doing. For instance, a man didn’t want his wife to know that he spent money on fancy electronic equipment. Every time he went to the grocery store he got a cash back and saved all his cash backs for his “secret” purchases. “Shading” the truth might be a woman who buys a dress but instead of buying just one she buys two of the same dress. When her husband asks if she took the dress back because he thought it was too much to spend, she says yes and takes one back and keeps the other!
Research has shown that if a couple earns about $70,000 dollars, or what it takes to satisfy their basic living needs, they have a base for happiness. Having less than what pays for basic needs makes people unhappy. But if you earn more, be it $100,000 or $1,000,000 there is a less direct effect on happiness. How many rich people can you think of that aren’t happy?
Q: Are there any typically gendered roles that play out, or do the circumstances always vary?
A: There are stereotypes about gender and money and there is established truth about gender and money that is backed up by research. Men tend to be more confident with money, more controlling about it, bigger risk takers and spend as much discretionary income as women. Where women tend to spend money on their appearance and for their family and household, men tend to spend primarily on themselves for big ticket items like flat screen TVs and electronic devices.
Women worry more about money, are more cautious, are better with money details and follow through with budgets more effectively. They are also better investors and are more likely to listen to other people’s advice. Of course, there are exceptions to these “truths.” Money attitudes a person grows up with and an influential peer group can modify gender differences and help a person develop how they wish to relate to money.
Q: If you and your spouse have different money habits, can you still be happy together?
A: Communication and empathy are key to being happy together no matter what money type you and your spouse are. The only exception to this is when someone has very extreme money habits, like being a compulsive spender or hoarder. Most extreme money behaviour is very hard to change or even modify. If that is the case it’s time to get help from a trained mental health professional.
Q: What’s your advice for anyone sick of fighting with her partner over money troubles?
A: If you and your spouse keep repeating behaviour you don’t like but can’t stop, it’s time to ask for help from a trusted friend, a minister, a financial advisor, or a financial therapist. If you find you can’t have empathy for your spouse even though you don’t agree with them that is another indication that professional advice might prove useful.