Connect with us

Market Insider

7 Fights Couples Have Had Over Money That’ll Make You Cringe




All couples fight, even successful ones. But it seems that money can be a particularly sore subject in relationships.

According to the latest Couples & Money study from Fidelity, more than half of couples surveyed said they brought debt into their relationships ― 20 percent admitted that had a negative impact. Among respondents who are concerned about debt, almost half said that money is their biggest relationship challenge and 67 percent said they argue about money regularly.

Money conflicts in relationships happen more often than you might think. But they don’t have to be dealbreakers, no matter how bad the situation might seem.

We spoke with several couples counselors about the money conflicts they’ve personally mediated to learn how real couples deal with money problems and how some came to successful resolutions.

1. The Clashing Life Goals

“I worked with a couple once where the husband was the breadwinner and resented his wife for not working. She refused because she wanted to pursue her passions in life, even though none of them earned money. In turn, the man felt alone and overwhelmed with supporting his wife and four children by himself.

My recommendation was for her to further her education in something she loves so she can eventually develop a career with it to earn income. She loved helping others, so she decided to pursue a master’s in counseling to become a therapist so she could keep following her passion while also getting paid. This was a win-win for both of them!” — Dr. Wyatt Fisher, a licensed clinical psychologist, marriage counselor and Christian dating site founder in Boulder, Colorado.

2. The Thailand Sex Vacation

“The couple that I was seeing last — a male in his early 40s and female in her early 30s — came to see me for premarital counseling. They faced several hiccups before reaching the conclusion that they’d be happy married. One problem was that they were broke, partially due to the sex trip to Thailand that the male partner went on with his best friend a year earlier.

Long story short, the guy took out a loan of about $14,000 to pay for flights and sex. His long-time girlfriend first found out about the loan (and later, the reason for it) when they tried to buy a car together. He wasn’t repaying the loan regularly, resulting in a poor credit score and an inability to secure a car loan.

The trip to Thailand took place two years before they were living together and the female patient was temporarily living in a different town for a work assignment, so it was easy for her partner to hide his little two-week escape. So, we worked on the trust issues — we discussed any possible secrets that both partners had and whether they were able to move past these issues and establish a lasting relationship. It was evident to me that both of them wanted something more and were working together to make that happen.

In terms of finances, we figured that the guy would need to save up money to get the things his female partner expected — the car, saving up for the wedding, etc. In the end, she didn’t even hold a grudge for him spending the money; it hurt her that he cheated, but she recognized that he probably didn’t spend much on sex considering how costly the actual travel was. I was quite perplexed with the level of understanding that this woman had for this guy.” — Damian Jacob Sendler, sexologist and head of Felnett Health Research Foundation in New York City

3. The Compulsive Shopper

“One client of mine had a habit of spending a lot of money on clothes and shoes, only to never wear them. It drove her husband crazy when he would see tags adding up to thousands of dollars every time he walked in the closet.

My suggestion was to let her continue to buy whatever she wants, with these conditions: 1) She must show her husband what she buys the same day she buys it, 2) She must put on a fashion show for her husband that same day and 3) If she doesn’t wear the items within a 14-day period, they both go to the store together to return the items ― on a busy Saturday, nevertheless.

Lots of clothing was returned at first, and they found that returning all of these items became very time-consuming and exhausting. Soon enough, however, fewer clothes and shoes were purchased, and eventually, it slowed down to the point where only a few items needed to be returned. Now, she’s a lot more thoughtful about what she purchases and doesn’t need to make nearly as many returns. Plus, as an added bonus, they both still enjoy the fashion shows! They’re now saving money and are no longer resentful of one another.” — Dr. Erika Rasure, assistant professor of business and financial services at Maryville University in St. Louis

4. The Financial Philanderer

“Bob and Carol came to my office for what they said was ‘infidelity treatment.’ When they arrived, they confessed that the real problem was Bob’s spending habits. He wrote checks, ran up credit cards and withdrew cash from the ATM without telling Carol. What they were describing was ’financial infidelity’ and for Carol, it felt the same as if Bob were cheating on her with another woman.

Carol was upset that Bob refused to discuss the basics of their financial goals, including how they were planning for the future, envisioning retirement or creating shared investments. Bob was conflict-avoidant in general, but talking about money sent him into a full-blown panic.

In therapy, we started with a conversation about appreciation. I asked Carol and Bob to appreciate each other for how they had each handled their finances so far. Carol said she appreciated that Bob paid for dinner every time they went out. Bob said he appreciated that Carol saved money and that they had plenty in their 401(k) for the future.

People respond positively to appreciation, and most couples will withdraw if they feel criticized. It helps to start the conversation not with a criticism of what they are doing wrong (they already know that) but to let them know what they are doing well.” — Dr. Tammy Nelson, sex therapist and author of The New Monogamy

5. The Ruthless Battle

“I was counseling a couple where the wife was done waiting for her husband to change and decided she wanted to get a divorce. The day after she told him this in our counseling session, he found a $100,000 joint bank account had just been emptied to zero.

This set off an avalanche of financial maneuvers by each as they sought to ‘get theirs’ and protect themselves. It took years and tens of thousands of dollars in attorney fees to sort it all out. It could have all been prevented with a little honest, upfront communication. But, of course, this was one of the reasons why they were in counseling in the first place.” — Dr. Kurt Smith, therapist who specializes in counseling men

6. The Cultural Divide

“I have seen many couples in which Partner A is a first generation American and Partner B may be third or fourth generation American. Partner A grew up in a family that had to scrimp, sacrifice and save for their children to have better opportunities. Partner B grew up in a comfortable middle-class or even in a wealthy home and doesn’t remember their folks discussing finances in front of them or with them.

Partner A feels guilty spending on items or experiences that seem indulgent, thinking it’s selfish and unfair to their parents who sacrificed so much, as well as feeling like they’re taking what should go to their children. Partner B saw how money can provide creature comforts and excitement ― taking trips, buying a home that is a bit beyond their means, purchasing special gifts for their partner.

These couples have to talk about their values and the meaning underlying their views; otherwise, they will remain in emotional gridlock and not see eye to eye on finances.” ― Sari Eckler Cooper, founder and director of a practice specializing in couples therapy and coaching

7. The $5,000 Phone Bill

“I was counseling a young newlywed couple. The husband was just discharged from the Navy, and the couple was living with his mother-in-law (the bride’s mom). He ran up a $5,000 bill calling sex sites on his mother-in-law’s house phone.

Of course, it was a giant fight, and based on complete ignorance on his part. He had whiled away time during his Navy stints calling sex lines and continued the habit once he was home. He didn’t seem to realize it would run up his mother-in law’s bill. We managed to get it worked out, calm everyone down, get him to face his addiction to the calls and make reparations. I haven’t seen them since we fixed it, so I hope he learned something useful.” ― Tina Tessina, psychotherapist and author of 13 books including How to be Happy Partners: Working it out Together

What’s Really Going On When Couples Fight About Money

If we look closer at these money conflicts, it becomes clear that financial problems are a symptom of deeper relationship issues, not the cause.

“What it really comes down to is people just might not be communicating about money in general,” said Lorna Kapusta, vice president of Fidelity’s Women Investors division.

Kapusta said a good first step for couples who want to get on the same page and communicate better is talking about shared goals: “What’s important in your life? What do you want to achieve?” In those conversations about your shared life, money discussions will come naturally.

Kapusta did note that these conversations can be awkward and tough to navigate, so it’s helpful to work with an objective third party.

But what if hiring an adviser is out of your budget? “If one or both people have a retirement account … you can often call those services and they will actually begin to help [with] those conversations ― and that’s for free,” she said.

Responses have been edited or condensed for clarity.


Source link

قالب وردپرس

Market Insider

4 things kids need to know about money




(NC) Responsible spending includes knowing the difference between wants and needs. Back-to-school season, with added expenses and expectations around spending, is the perfect time to not only build your own budget for the year ahead, but also to introduce your own children to the concept of budgeting.

The experts at Capital One break down four basic things that every child should know about money, along with tips for bringing real-life examples into the conversation.

What money is. There’s no need for a full economic lesson,but knowing that money can be exchanged for goods and services, and that the government backs its value, is a great start.
How to earn money. Once your child understands what money is, use this foundational knowledge to connect the concepts of money and work. Start with the simple concept that people go to work in exchange for an income, and explain how it may take time (and work) to save for that new pair of sneakers or backpack. This can help kids develop patience and alleviate the pressure to purchase new items right away that might not be in your budget.
The many ways to pay. While there is a myriad of methods to pay for something in today’s digital age, you can start by explaining the difference between cash, debit and credit. When teaching your kids about credit, real examples help. For instance, if your child insists on a grocery store treat, offer to buy it for them as long as they pay you back from their allowance in a timely manner. If you need a refresher, tools like Capital One’s Credit Keeper can help you better understand your own credit score and the importance of that score to overall financial health.
How to build and follow a budget. This is where earning, spending, saving and sharing all come together. Build a budget that is realistic based on your income and spending needs and take advantage of banking apps to keep tabs on your spending in real-time. Have your kids think about how they might split their allowance into saving, spending and giving back to help them better understand money management.

Continue Reading

Market Insider

20 Percent Of Americans In Relationships Are Committing Financial Infidelity




Nearly 30 million Americans are hiding a checking, savings, or credit card account from their spouse or live in partner, according to a new survey from That’s roughly 1 in 5 that currently have a live in partner or a spouse.

Around 5 million people — or 3 percent — used to commit “financial infidelity,” but no longer do.

Of all the respondents, millennials were more likely than other age groups to hide financial information from their partner. While 15 percent of older generations hid accounts from their partner, 28 percent of millennials were financially dishonest.

Regionally, Americans living in the South and the West were more likely to financially “cheat” than those living in the Northeast and Midwest.

Insecurity about earning and spending could drive some of this infidelity, according to industry analyst Ted Rossman.

When it comes to millennials, witnessing divorce could have caused those aged 18-37 to try and squirrel away from Rossman calls a “freedom fund”.

“They’ve got this safety net,” Rossman said. They’re asking: “What if this relationship doesn’t work out?”

As bad as physical infidelity

More than half (55 percent) of those surveyed believed that financial infidelity was just as bad as physically cheating. That’s including some 20 percent who believed that financially cheating was worse.

But despite this, most didn’t find this to be a deal breaker.

Over 80 percent surveyed said they would be upset, but wouldn’t end the relationship. Only 2 percent of those asked would end the relationship if they discovered their spouse or partner was hiding $5,000 or more in credit card debt. That number however is highest among those lower middle class households ($30,000-$49,999 income bracket): Nearly 10 percent would break things off as a result.

Roughly 15 percent said they wouldn’t care at all. Studies do show however that money troubles is the leading cause of stress in a relationship.

That’s why, Rossman says, it’s important to share that information with your partner.

“Talking about money with your spouse isn’t always easy, but it has to be done,” he said. “You can still maintain some privacy over your finances, and even keep separate accounts if you and your spouse agree, but you need to get on the same page regarding your general direction, otherwise your financial union is doomed to fail.”

With credit card rates hovering at an average of 19.24 percent APR, hiding financial information from a partner could be financially devastating.

But, Rossman adds, it’s not just about the economic impact but also the erosion of trust.

“More than the dollars and cents is that trust factor,” he said. “I think losing that trust is so hard to regain. That could be a long lasting wedge.”

Kristin Myers is a reporter at Yahoo Finance. Follow her on Twitter.

Source link

قالب وردپرس

Continue Reading

Market Insider

7 Examples Of Terrible Financial Advice We’ve Heard




Between television, radio, the internet and well-meaning but presumptuous friends and family, we’re inundated with unsolicited advice on a daily basis. And when it comes to money, there’s a ton of terrible advice out there. Even so-called experts can lead us astray sometimes.

Have you been duped? Here are a few examples of the worst money advice advisers, bloggers and other personal finance pros have heard.

1. Carry a balance to increase your credit score.

Ben Luthi, a money and travel writer, said that a friend once told him that his mortgage loan officer advised him to carry a balance on his credit card in order to improve his credit score. In fact, the loan officer recommended keeping the balance at around 50 percent of his credit limit.

“This is the absolute worst financial advice I’ve ever heard for several reasons,” Luthi said. For one, carrying a credit card balance doesn’t have any effect on your credit at all. “What it does do is ensure that you pay a high interest rate on your balance every month, neutralizing any other benefits you might get from the card,” Luthi explained. “Also, keeping a 50 percent credit utilization is a surefire way to hurt your credit score, not help it.”

Some credit experts recommend keeping your balance below 30 percent of the card limit, but even that’s not a hard-and-fast rule. Keeping your balance as low as possible and paying the bill on time each month is how you improve your score.

2. Avoid credit cards ― period.

Credit cards can be a slippery slope for some people; overspending can lead to a cycle of debt that’s tough to escape.

But avoiding credit cards on principle, something personal finance gurus like Dave Ramsey push hard, robs you of all their potential benefits.

“Credit cards are a good tool for building credit and earning rewards,” explained personal finance writer Kim Porter. “Plus, there are lots of ways to avoid debt, like using the card only for monthly bills, paying off the card every month and tracking your spending.”

If you struggle with debt, a credit card is probably not for you. At least not right now. But if you are on top of your finances and want to leverage debt in a strategic way, a credit card can help you do just that.

3. The mortgage you’re approved for is what you can afford.

“The worst financial advice I hear is to buy as much house as you can afford,” said R.J. Weiss, a certified financial planner who founded the blog The Ways to Wealth. He explained that most lenders use the 28/36 rule to determine how much you can afford to borrow: Up to 28 percent of your monthly gross income can go toward your home, as long as the payments don’t exceed 36 percent of your total monthly debt payments. For example, if you had a credit card, student loan and car loan payment that together totaled $640 a month, your mortgage payment should be no more than $360 (36 percent of $1,000 in total debt payments).

“What homeowners don’t realize is this rule was invented by banks to maximize their bottom line ― not the homeowner’s financial well-being,” Weiss said. “Banks have figured out that this is the largest amount of debt one can take on with a reasonable chance of paying it back, even if that means you have to forego saving for retirement, college or short-term goals.”

4. An expensive house is worth it because of the tax write-off.

Scott Vance, owner of, said a real estate agent told him when he was younger that it made sense to buy a more expensive house because he had the advantage of writing off the mortgage interest on his taxes.

But let’s stop and think about that for a moment. A deduction simply decreases your taxable income ― it’s not a dollar-for-dollar reduction of your tax bill. So committing to a larger mortgage payment to take a bigger tax deduction still means paying more in the long run. And if that high mortgage payment compromises your ability to keep up on other bills or save money, it’s definitely not worth it.

“Now, as a financial planner focusing on taxes, I see the folly in such advice,” he said, noting that he always advises his client to consider the source of advice before following it. ”Taking tax advice from a Realtor is … like taking medical procedure advice from your hairdresser.”

5. You need a six-month emergency fund.

One thing is true: You need an emergency fund. But when it comes to how much you should save in that fund, it’s different for each person. There’s no cookie-cutter answer that applies to everyone. And yet many experts claim that six months’ worth of expenses is exactly how much you should have socked away in a savings account.

“I work with a lot of Hollywood actors, and six months won’t cut it for these folks,” said Eric D. Matthews, CEO and wealth adviser at EDM Capital. “I also work with executives in the same industry where six months is overkill. You need to strike a balance for your work, industry and craft.”

If you have too little saved, a major financial blow can leave you in debt regardless. And if you set aside too much, you lose returns by leaving the money in a liquid, low-interest savings account. “The generic six months is a nice catch-all, but nowhere near the specific need of the individual’s unique situation… and aren’t we all unique?”

6. You should accept your entire student loan package.

Aside from a house, a college education is often one of the biggest purchases people make in their lifetimes. Often loans are needed to bridge the gap between college savings and that final tuition bill. But just because you’re offered a certain amount doesn’t mean you need to take it all.

“The worst financial advice I received was that I had to accept my entire student loan package and that I had no other options,” said Gina Zakaria, founder of The Frugal Convert. “It cost me a lot in student loan debt. Now I tell everyone that you never have to accept any part of a college financial package that you don’t want to accept.” There are always other options, she said.

7. Only invest in what you know.

Even the great Warren Buffett, considered by many to be the best investor of all time, gets it wrong sometimes. One of his most famous pieces of advice is to only invest in what you know, but that might not be the right guidance for the average investor.

In theory, it makes sense. After all, you don’t want to tie up your money in overly complicated investments you don’t understand. The problem is, most of us are not business experts, and it’s nearly impossible to have deep knowledge of hundreds of securities. “Diversification is key to a good portfolio, and investing in what you know leads to a very un-diversified portfolio,” said Britton Gregory, a certified financial planner and principal of Seaborn Financial. “Instead, invest in a well-diversified portfolio that includes many companies, even ones you’ve never heard of.”

That might mean enlisting the help of a professional, so make sure it’s one who has your best interests at heart.

Source link

قالب وردپرس

Continue Reading