Let’s talk about cash, baby

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According to a recent PWC Employee Financial Wellness report, 57% of employees said that finances are the top cause of stress in their lives.

Are you one of those people?

Maybe you grew up in a house where your family never talked about money, or maybe money was always a negative topic. Here are five ways to talk about money with your partner in a way that makes it a positive conversation!

1. How do you want to split expenses?

Think of your household expenses as coming from various ‘pots’ – here are three options:

  • One pot: This is when you merge your respective bank accounts and share one account. It doesn’t matter who pays what because you’re seeing your income and expenses as one. (If you don’t want to change bank accounts, set up a joint 22seven profile, which will combine all your transactions in one place.)

  • Two pots: Each person is responsible for certain things. The list is reviewed every year to adjust to circumstances. You pay what you need to pay towards the household and the rest is your own.

  • Three pots: Each person keeps their own account, but you also open a joint account for household expenses. Each partner contributes a certain amount to the joint account each month. Some couples pay 50/50; some pay a different split depending on how your incomes differ.

2. How should we deal with debt?

Do you have a loan that you’re paying off, like a student loan, car loan, home loan or a few store cards? It’s nothing to be embarrassed about! Be honest with each other so that you can decide the best way to tackle your debt together.

3. How do you want to save, and how much?

One person might want to save 80% of their salary, others might want to save none… It’s good to talk about it. Lead the conversation by outlining your ideal life: When and how do you want to retire? How do you want to pay for emergencies? Do you want to save for your kids’ university education?

The answers to these questions will determine how much you need to save as a couple. From there, you can choose a savings product; or chat to a financial planner to help you come up with a strategy that will work for your lifestyle and income.

4. Do you need to support anyone?

Many people support parents or other family members. If you’re one of those people, make sure your partner is aware of your obligations! Talk about it: you might be able to find a creative solution together, which benefits all parties.

5. What about fun money?

This is the cash you set aside to enjoy life. Obviously, the more you set aside for fun, the less you’ll have for other things like paying off debt and saving… It’s important to find a balance. For you, fun money might be going to a restaurant once a month; for your partner, it might mean an annual holiday. Either way, use 22seven to factor fun into your budget to make sure you set enough money aside.

We’re not saying you should lay out your entire financial life plan on a first date, but if you’re married or in a long-term relationship, you have to get used to talking about money. It is possible to live within your means and be happy about it, but only if both parties are open and honest with each other.