Today, thinking about money problems creates stress for all people. However, when you live alone, you make your own money decisions. When you're married or cohabiting the stress can be double or more. It pays to talk with your partner about money, specifically how you will use money jointly. In the following lines, you will read about steps that can help you with marital financial compatibility.

Step 1. Start the conversation off simply & just talk

In a serious relationship, you also need to talk about money. First of all, you should talk about your money habits. These habits are acquired in early childhood. That is why it is necessary to discuss how your families spent money. Did they save a lot or did they scrape by? Was debt a concern for your parents? Did they fight about money? Based on the habits your parents had, you may have them too. After all, they are your teachers on how to spend money. They created the money habits that you have today.

If your money habits have differences, you should learn to compromise (true of most things in a serious relationship). You should also discuss whether you have debts, more precisely loans. How do you deal with them? To know how it will be when you spend money together, you need to talk openly about your money habits, which ones work and which ones don't. After that, you should adopt a hybrid approach that works by using good money habits while at the same time working to eliminate bad money habits.
 

Step 2. Run the numbers & (again) just talk

Creating a budget means putting numbers into the budget itself. To create a budget, you need to track your expenses individually, but also for the household. You can do that for a couple of months using our tools or simply on paper. Since you've already prioritized and put them into specific categories, you should add numbers based on what you've spent. The most important thing is to work together on the budget. If necessary, see where you can reduce spending and increase savings or debt pay down. When you create a budget, you need to track how close the budget figures are to how much you spend.
 

Step 3. Take action & establish a join spending (and saving) plan

The main action a married couple should take for spending and saving is budgeting. When determining the budget, it is also determined what the savings account will be opened for. They can open a savings account for children's education, vacations, trips, and any small or large goals that a married couple wants to achieve. After the savings account, they also open a fund for emergencies such as house repairs, car repairs, and other things that may arise.

The married couple also have jobs, so they should also choose a pension fund in which to invest. It all depends on their job and what pension fund their employers can offer them. There are multiple retirement funds such as 401(k), Roth 401(k), Roth IRA, and IRA. Each of them has its advantages and disadvantages, and it is up to the married couple to decide which pension fund to use.
 

Step 4. Set short- and long-term priorities

The short-term and long-term priorities of married or cohabiting partners may be different. That is why it is very important to align priorities. Short term is about paying for basic needs - rent, food, utilities, debt payments, but also fun things like eating out or day trips. Long term priorities might be about saving for a down payment on a house, vs buying a flashy car. To avoid angering the other person, make sure to stay on the same page with both short and long term spending. It might be that you expect to confirm any purchase over $200 with the other person, but if it is under $200 then feel free to go for it. It might also be that you decide to keep your money totally separate except a common account for certain expresses or savings goals. Whatever you decide, an up front agreement is needed at the beginning, which the spouses will always adhere to.
 

Conclusion: To achieve financial compatibility married couples need to follow these very simple steps. Although these steps seem difficult at first glance, they are not at all, it just requires marital harmony regarding finances.