GOLDEN VALLEY, Minn. — This Valentine's Day, show how much you love your spouse or significant other in a new way.
Spend time fixing money mistakes that coudl be destroying your relationship.
Local financial professional Justin Halverson from Great Waters Financial joins us with five big money mistakes couples should avoid.
Financial Infidelity
- About 29 million Americans admit they are keeping financial secrets from their partner, like a secret credit card or bank account.
- Keeping secrets is committing financial infidelity, which can put a big strain on your relationship.
- I can’t stress enough how important it is to be honest with your partner about your financial situation, including your bank accounts and your debt.
- I’m not saying you can’t have a separate account for your own purchases or for buying gifts. The key is making sure your partner is aware of it.
No Emergency Fund
- About 55 million Americans have no emergency savings.
- Worse yet, nearly a third of baby boomers claim they have no money saved - that’s a dangerous position to be in so close to retirement.
- An emergency fund can help in situations like a car repair or home repair. I recommend my clients have 3-6 months' worth of expenses saved in a separate account that can be accessed in case of an emergency.
Ignoring Debt
- More than half of couples enter marriage with debt. Once they are married, they disagree on whose responsibility that debt is.
- Work as a team and help each other to pay down debt. Take inventory to determine who you owe and how much.
- A debt worksheet can help you keep track of balances, due dates, minimum payments and interest rates, and I have one on my website.
- I recommend starting with your lowest balance. Devote as much as you can to that debt, while still making minimum payments on all your other debts.
- Once that is paid off, move to your next smallest debt.
Neglecting to Talk Retirement Goals
- No matter what your age, it’s important to talk about retirement.
- Couples should be asking each other what their dream retirement looks like. Do they want to travel the world or stay home and spend time with family? Setting a shared goal will help you and your spouse stay on track to achieve your goals.
- I see so many couples prioritizing saving for their kids’ college over retirement. Doing this could delay or derail your retirement dreams.
- Children will be able to take out a loan for college, but you won’t be able to take out a loan for retirement.
- It’s important to recognize you don’t have to see eye to eye on everything, but you need to work toward a retirement plan both of you feel comfortable with.
No Social Security Strategy
- Married couples have more options than a single person when it comes to Social Security benefits. There are over 500 different claiming strategies.
- Couples have the advantage of staggering when they claim Social Security. Taking it at different ages has many benefits, but will be different for everyone. Make sure you speak to a professional who can help guide you.
- Retirement is not a guessing game. If you don’t know how much money you need to save for retirement, I have a calculator on my website to help you get started.
How can you improve your conversations about money as a couple?
- Set up a quarterly date to make sure you and your significant other stay on the same page.
- Consider an annual meeting with a financial professional who can help make sure you’re on the right track to reaching your goals.