The Importance Of Being On The Same Financial Page As Your Spouse
I have a keen interest in finding new ways to improve myself and our firm, and I love reading books about growth, both personal and business. The other day, I was listening to a summary of Driven By Difference by David Livermore, and a phrase the author used jumped out at me.
Describing companies with cultures that foster innovation, Livermore says that they are characterized by a "willingness to cannibalize assets," which means being willing to sacrifice current profit-generating activities for the possibility of a great innovation in the future. This concept may be so counterintuitive to some people that they can't latch onto it, while for others, it comes naturally and makes perfect sense. How well the organization flourishes is influenced by the background of the people involved and their ability to work together in harmony for a greater good.
I think the reason I clicked with this idea is that it's a good parallel to the dynamics of how married couples handle their finances. For some, holding onto the principle in their investments is critical. For these people, principle equals security, and it's the thing that makes them feel optimistic about their future. Others see principle as something they can use now to build something that may result in much more wealth in the future.
Couples who see such financial issues in different ways regularly disagree on financial decisions. They frequently have no understanding of where the other person is coming from, but even when they listen enough to reach an understanding, they still don't usually agree, and the tension between them remains.
We have all heard the statistics on financial arguments and divorce. If you don’t see eye to eye with your spouse on your finances, go through an exercise exploring the life events that affect your financial decisions together. Discuss not just your preferences but what fear or need drive them. While your positions aren’t likely to change dramatically, understanding each other can help you better respect each other’s positions. If you aren’t married yet it is important to have that conversation early. Talking about money can be uncomfortable but it is important before you commit to spending the rest of your lives together.