For Love And Money

Popular financial columnist, Suze Orman, formerly VP Investments of Prudential Bache and an account officer for Merrill Lynch, authored the book: The Road To Wealth, which is a collection of her knowledge of all things financial. Her book is a treasure trove of information on stocks, bonds, insurance, debt, estate planning, and many more things, but I found one chapter very interesting–and this dealt with the subject of money and relationships.

Money can be a very sensitive issue, particularly for two people who are or are planning to live together but come from very different backgrounds, upbringing, and experience with finances. Suze’s chapter on Financial Intimacy can be a good start in understanding the role of money in the context of relationships.

Here’s an except of that chapter:

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Falling in love is simple–or so it often seems in retrospect. Sooner or later, however, disagreements crop up, and love becomes a much more complicated business. Can you guess one of the most common subjects of disagreement between couples, married and unmarried? No surprise here–it’s money. Everywhere I go, I hear the same complaint: “We’re fighting about money.” Arguments about money are the catalyst for more separations and divorces than you can imagine. Why? Because people’s attitudes and fears aout their money give it power–and the ability to wreak havoc on the most important relationships in their lives.

Yet there’s a simple answer. I have said it before and I’ll say it again: Place people first, money second. Whether you are falling in love, living with someone, getting divorced, or starting your life over again following the death of someone you love, the people in your life come fist. This doesn’t mean that money has no relevance to love, however.

Of all the kinds and degrees of intimacy that exist in the world–physical, emotional, social, professional, or domestic–financial intimacy is one of the most satisfying and perhaps the hardest to achieve. If you and your partner or spouse haven’t walked carefully through all the money matters that might come up in time, I promise you that money will one day become an obstacle in your relationship. When financial change comes to you–and, for better or worse, it will come–it will have the potential to become a minefield of undisclosed expectations or fears.

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The rest of the chapter continues with various questions and answers to sensitive money questions. There are of course too many to list here, but one question which I found very relevant, especially to traders who have spouses or partners to manage their trading activities with. The question is not limited to traders per se, but actually applies to any couple:

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What are the most common problems couples face concerning money?

Most couples think they have problems with money for one or more of the following reasons: one partner spends too much while the other spends too little; one partner doesn’t care enough about money while the other cares too much; or one partner has too much money, and therefore too much power, while the other has too little.

Sound familiar?

In my experience, however, the problems couples face have little to do with the money itself. They have more to do with how partners feel about money. Since most of us have been taught to view money as a kind of report card, signalling how well we’re doing relative to others, we tend to measure our self-worth by our earning potential, the size and location of our houses, the clothes we wear, the cars we drive, the schools we send our children to, our bank balances, and so on–and not by our thoughts, feelings, and deeds. We value the financial results of our actions more highly than we value the actions themselves or their effect on other people. This is especially true if we have come to believe, as so many of us have, that money is synonymous with security–that money and money alone will provide for us and keep us safe. When our perceptions and priorities are thus skewed and we put money before people, that is when we encounter problems in our relationships. Talking about money is an antidote. It lays bare some of these underlying issues, and that’s how problems can be prevented or solved.

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Great stuff from Suze Orman. Actually for that chapter alone the book is a great read.