Love, Money & Financial Compatibility

Money is not a romantic discussion. But neither should it be a bone of contention.

Being Valentine’s Day, it’s only logical that I write about love and money today.

Over a year ago, I approached a bunch of people with one open-ended query: “Can you share a perspective on finances in a marriage?” I found the responses refreshingly honest and practical. So here goes.

Three responses startled me, and all had a common trait. The source of the friction did not come due to the spending or saving habits of each partner, but from outside influences.

“If any gift of a considerable monetary value is given, especially by close relatives, the couple must ensure that there are no strings attached as to how it is used; the couple needs to have full freedom to decide how to deploy those funds,” said Nitya. “In-laws and others should never be involved in a couple’s financial issues,” she added.

Abraham had a similar view. “Marriage is a partnership, and the severance of the umbilical cord is necessary. Financial support for parents is an obligation and a value we cherish, but that doesn’t mean that parents have complete control over their child’s finances and make demands.”

Laila emphasised: “It is important that in-laws on either side are not clued into detailed financial issues of the couple. I always made my spouse aware that I have to help my parents, and I never gave any money without his knowledge. If there was any disagreement, we thrashed it out before making the final decision. We never involved parents in this discussion.”

TAKEAWAY: Couples should bring their monetary obligations to the table, such as helping parents, or a sibling in their education or wedding. Because this would require money being pulled away from the nuclear family towards the extended family. But the final call should be made by the couple.

Sheryl had a very matter-of-fact approach on this aspect. She said she entered the marriage knowing that both will have very different views on spending. But what she was not prepared for was how petty it could get. “My husband could never understand why I spent so much at the salon—to get a pedicure or hair spa. I told him I could never understand how an expensive beer or premium alcohol is a necessity,” she said.

Since both were earners, they decided to have two individual accounts and one joint account. There is complete honesty in how much each earns. They both contribute to the joint account to manage the house. This way, their “private quirks” are not a source of angst.

Ranjana mentioned how her partner’s Swiggy / Zomato expenses dropped drastically when he was without a job for a few months. They re-evaluated their expenses so that they could channelise their money into what they really wanted, and so, rather than ordering food online, almost daily, they began visiting a restaurant once a week where they go to enjoy the experience—either with friends or by themselves.

TAKEAWAY: Neither let things escalate into a contentious issue. They managed it by changing the narrative. They worked on a shared vision of what they wanted their marriage to be. Money, instead of becoming the bone of contention, was a bonding factor and enabler in creating great memories.

(Names changed for privacy).

Scott Rick, behavioural finance expert and author of a new book, "Tightwads and Spendthrifts: Navigating the Money Minefield in Real Relationships" shared a practical guideline in a recent podcast.

He said that if the couple is arguing about the purchase of a material good (car, refrigerator), let the tightwad win. This is someone who hates spending. But if the fight is over an experience (the type of holiday), let the spendthrift win because the shared experiences, the anticipation, the planning, and the memories will create more joy.

He conveys he point that starkly different personalities can also have a non-contentious issue with respect to money if they balance the giving and the taking. If approached in a collaborative fashion, and not combative, money need not cause fissures in a relationship.