How many times have you begged your partner to get better at managing the family finances, only to have her/him roll eyes, shrug shoulders and beg off being capable of handling such responsibility? It happens all too often between couples. One manages the money the other mostly takes care of the household business, for lack of better word.
In our home, I am the financial decision maker, SMB doesn’t have much interest in knowing our tax bills or investment returns.
It can’t be easy to get your spouse/partner interested in improving skills in managing the family finances if the interest is not there to begin with. So, what can you do to let your partner gain better financing skills and make an active decision maker in the process? There are various financial tasks you may gradually hand to her/him in this “financial skills training program”:
I can’t go along mentioning ‘him’ and ‘her’ in every sentence, I will just mention a spouse broadly as ‘her’ or ‘she’ but I do mean ‘him’ and ‘he’ as well. I have seen women who manage personal finances because they have more skills than their male partners in managing it. This article is for those families as well. Please don’t feel I am being sexist here.
If you partner is not at all interested in your finances, she better be! If something happens to you she shall be prepared. The first thing you can do right now is sharing your online access. I did that, SMB, my wife has a copy of ID and passwords for all of financial accounts we have.
I also sit with SMB every month to go over the monthly expenses and earning numbers. Now that SMB is looking for a job or alternatively starting up a home based business. I am gradually making her financially inclined, it’s tough job, no doubt. Your partner needs help from you to start understanding financial matters. Be patient and explain the terms and how to’s thoroughly. Your spouse should understand. Refer to this article on Forbes, 10 ways budgeting saved my marriage and see how managing finances together saved their marriage.
Below are the step by step approach I followed and got some good results. See if they can fit in to your situation as well.
Start Out Small
Paying bills, balancing the checkbook
Begin with something fairly easy; let your partner balance the checkbook. Even if she might try to insist that she doesn’t know how, don’t buy into it, if your partner has a high school diploma she can add and subtract just like everyone else and calculators are a dime a dozen for those who have trouble with math. This is the most basic financial teaching you can impart on your partner. I shared my Yodlee details with SMB and she first thought it was gibberish but, I am sure slowly she’ll conquer it.
Finding the desired policy providers
Assign your partner with additional financial duties. Let her pick the insurance policy providers for the household, for example: vehicle insurance, health, dental and vision insurance, as well as homeowners insurance to protect all of your property and interests.
Let her choose the one provider that will best save money and provide most practical services. This will help her instill more confidence and sense of financial responsibility, thus improve her abilities to handle financial matters.
I can think of giving SMB a task to find a cheaper car insurance provider. Once she gets comfortable with our budgets, I’ll explain the auto insurance nuances and then let her find a cheaper provider. We pay $680 semi annual premium to Geico for our two cars. I’d be delighted if she can get a cheaper provider.
Plan family vacation
The next time a family vacation comes up, let your partner take the lead in planning it. Have her make the necessary arrangements for accommodations on your trip. She can budget the vacation by choosing the location, resort, and any entertainment adventures. This will tremendously improve her skills of calculating budget and staying within budget.
Whether to buy or lease a car
Get your partner involved with the decision of purchasing or leasing a new vehicle. Let her do the research and provide a well-informed and sound decision. If you disagree with her decision then discuss the reasons why you feel your decision would better benefit the family’s financial outlook.
Keep Feeding the Fire
Plan to save for kids’ college funds
If you have children then let your wife make the necessary plans to send them to college. Have her set up college funds for the kids and let her maintain the funds. She will gain a greater appreciation for tuition fees and the related costs of furthering your children’s education.
We all want to know that we can retire someday. Nobody wants to work forever. Have your partner set up the necessary IRA’s for you two to contribute to. Get her involved with selecting which IRA investment packages to place your money in. Sit down with your partner and go over the reasons behind the decision and discuss any differences you might have with her viewpoints, but keep an open mind and listen to any rebuttal.
Investment in stocks, bonds, gold, silver, etc.
Getting your partner involved with making investment decisions is one of the last things you can do to improve financial skills. Have her research a few different stocks she would like to invest in. You have to start small, let your partner manage a small amount or a couple of stock investments only. Letting her dive right in and dump a boatload of cash on a certain unproven stock is not an advisable idea.
Have her look into commodities as well like gold, platinum and silver. Have her track the fluctuating prices on the daily market and see what decisions she comes up in this area. Investments in these types of commodities require constant maintenance and attention to detail, since the prices on the market fluctuate constantly.
Start a home business if you can
If your partner likes to stay at home, get her interested in starting a home business. Find something she is interested in and build the home business around it. Daycare’s are a good idea, if she’s home watching your kids, she could just as easily watch over their friends and make a little money doing it.
There are also several online businesses that can generate a sufficient income while working from home. You also have to let her learn to be careful where she looks for legitimate online business opportunities, and be cautious of any scams. When she manages to finish this task, she will be a master of finance, and possibly also a successful business woman.
Managing personal finance is not one man’s/woman’s job, it’s a collective activity. involve your spouse in decision-making. Make him aware of situation and seek opinions. I am sure every spouse can come up and grasp things needed to manage finance effectively. And who knows? It may strengthen the bond between you two.
Readers how are you ding at your household? Wish to share some of your own tips?