They say money can’t buy love, but it can buy heartbreak. Love and finances are exceedingly complex subjects, so it makes sense that it only gets more complicated when you combine them. With Valentine’s Day just around the corner, the AICPA® Financial Literacy Commission encourages Americans to give their loved ones the gift of an honest talk about money.
For relationships to work, couples need to be willing to discuss their finances. Fortunately, 81% of Americans who live with a partner or spouse said they’re “very” or at least “somewhat” comfortable having conversations about money, according to a new survey from the AICPA, which also shows avoiding the topic can have negative consequences.
The survey, which was conducted online in January 2021, polled 1,157 U.S. adults living with a spouse or partner.
Nearly three-quarters (73%) of respondents said financial decisions have caused tension in their relationship, with more than a quarter (26%) stating that happens at least once a month.
Among couples who are married or cohabitating, 69% have disagreed over financial decisions in the last year, according to the survey. Most of the rifts came down to needs vs. wants, spending priorities, making purchases without discussing them with a partner first, and paying off debt.
Having a frank conversation about money early in a relationship might help couples avoid these pitfalls.
More than 40% of Americans who live with a spouse or partner said it’s at least “somewhat likely” they’d end a relationship over financial dishonesty, such as discovering a partner had large amounts of undisclosed debt or secret bank accounts, according to the survey.
Even for couples who choose not to combine finances, it’s important to have open conversations about where each person stands on financial matters, Landsberg said. Partners should discuss their current and potential assets and liabilities, he said. These can include significant student loan debt or the possibility of having to financially support an aging parent.
Not getting on the right financial footing can have dire consequences. Almost half of married or cohabitating couples who experienced financially driven tension in their relationships (47%) said that their financial decisions have had a negative impact on their intimacy with their partner.
Speaking with a professional can help couples come to alignment on money matters. As CPA’s with a side of CFP, we enjoy helping our clients plan for both personal and business financial success!