Monthly Financial Meetings With Your Spouse
29 September 2006One of the series of articles I like a lot is CNN’s “Millionaires in the Making,” which spotlight people who have good personal finance habits that will eventually lead them to become millionaires. I think they’re great because they often have both good ideas sprinkled in there and some examples of stuff the couples really shouldn’t be doing. Today’s article is on the Aroras, a couple who immigrated from India. The husband is a computer programmer, and the wife is a dentist (although she’s got to retrain to be able to work in the U.S.).
This one had the typical mix of good and bad. The only real bad idea here (in my opinion) was sticking about 50% of your assets, or $90,000 in their case, in a low return CD. That’s just giving away money if your retirement horizon is 10 years or more out and you won’t need to use it anytime soon.
The idea they had that I like a lot is this:
And their monthly planning session gives them some good perspective about big upcoming expenses ahead. They catalogue all of their upcoming expenses for the month, and use this planning session to determine their savings rate as well.
Meetings about finance sound boring and not like anything a married couple would be doing. But this is very good advice because it keeps the couple on the same page. Most people are budgeting month-to-month. If, once, a month, you sit down and talk about your long term plans with your spouse and rejigger the numbers as needed, you make sure that both of you have the same goals and understand what you’re working for. It helps avoid the trap of one spouse undermining the other’s financial plans by being too free with spending. It also gives you a time you know you can bring up those “taboo” financial subjects without seeming like you’re nagging, lecturing, or making the other person uncomfortable. Money shouldn’t be taboo, but for many people it is. And not talking about money is just asking to let financial problems fester beneath the surface of the marriage. You don’t have to sit around and do spreadsheets with each other for an hour each month, but if you set aside the time to make some rough plans every month you’ll be better off for it.
Discuss this in the Free the Drones forums.
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