When couples have different views on finance

Sarah has a husband who is uninterested in all things financial. He doesn't care about insurance, investing, financial planning, etc. What he earns every month goes into his savings account with POSB and only leaves when he spends it. Sarah, however, is financially savvy, and asks that she be allowed to manage their money - she plans to put their combined earnings to work for them. She also gives him advice on what type of insurance to buy. "Sure," he says. "Go right ahead, love."

Sarah has a brother - Sean - who is also married. Discussions about finance are a cringe-inducing topic in Sean's household. He wants to invest his money, and urges his wife to do the same. His wife, however, has heard the horror stories that typically accompany stock crashes, and prefers to keep things simple. She doesn't want him doing anything potentially risky, and nags whenever she sees him looking at stocks, bonds, and other investment vehicles. She would rather he put his money into a savings account, just like she does. Sean, on the other hand, disagrees, and this causes friction between them. He doesn't agree with how she spends her money. To make things worse, she doesn't agree with his methods either.

Money isn't the root of all evil, but differing ideas on finance could be cause for arguments.

As long as one person is willing to bear the burden of being the couple's financial planner-cum-investor, financial apathy is easy to deal with. 

However, when couples have different views on money and how it should be saved or spent, the situation gets tricky. What is to be done? One's a spendthrift, the other a miser. One doesn't trust stocks, the other is more willing to invest and trade. One wants a family car for the sake of convenience (and also for face in some cases, although this usually isn't said out loud), the other insists on public transport because cars are too expensive in Singapore.

For those of you in this particular pickle, I feel you. I feel for you. It can be difficult, but perhaps some middle ground could be found with the following points:

1) It doesn't hurt to have a savings account with a decent interest rate

For simplicity, some people would rather put their cash in a POSB savings account and just be done with it. Even if your partner likes to keep things simple, having a savings account with a decent interest rate would be safe enough for them to venture.

Try the OCBC 360 account - it's simple enough to earn the bonus interest, and ATMs are fairly common around the island. Banks like CIMB and BOC do offer higher-than-usual interest rates on their savings accounts, but accessibility could present an issue.

2) Try to have the 'talk' before marriage

This is important, and should have been the first point, but it's true - try to get to know your partner's spending/investing habits before marriage, so this issue can be worked out in advance. The best remedy to a problem is the prevention of it in the first place. These ideas don't suddenly change because of a wedding band.

If both parties cannot agree on finances, I've personally borne witness to too many real-life horror stories to know how badly it could go. If this issue persists after marriage, it starts getting messier and messier. If you can't trust your spouse with money, how do you trust them with other matters?

I've seen people break up just one week after making wedding preparations because the issue of money reared its ugly head. If both parties really can't agree, you can foresee stormy clouds in the future.

3) Start them off slow, and don't forget to show proof 

For the more risk averse, it can be a daunting challenge for them to do something with their money which is - as far as they know - not guaranteed. What if the stock does badly? What if the company can't settle their debts and end up like Swiber? What if the economy does badly and the stock sinks too?

If you're into investing in blue-chips and you've been making a steady passive income, tell them what you've been doing. If possible, bring out the black-and-white. Records of steady dividends (along with the amount of capital spent) might help you along in your quest to win your partner over. If you succeed in breaking the ice, consider teaching your partner a little about investing.


On another note, my trading portfolio isn't looking so good right now - I'm going to hold on a little while longer to see how things turn out.

Until next time.


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