Talking about money is like when your parents first talked to you about sex – you probably wanted to throw yourself out of a moving car! Money is the #1 taboo topic in America – it’s something that we knew was private growing up and we were taught never to talk about it. This is fine… until you are in a relationship. When “your” money becomes “our” money, the realization kicks in that talking about money is really difficult and often leads to tension. It’s no surprise that money is one of the leading causes of divorce in America. Why is that? Well, think about it.
Money is one of the few things that is a pure reflection of our hard work, time and values. The money you earn and save has so many stories and feelings behind it. This I why I think of money as more of an exchange of feelings, as opposed to a math equation.
Combine this emotional, heavy topic with the fact that we have no practice talking about it – well no wonder why this is so hard! So, how do you talk about it?
It starts with awareness. Everyone has money scripts that they live their life by. These scripts were developed in childhood – for better or for worse, our parents passed on their own attitudes and beliefs about money to us. People often take these deeply held money messages to heart and never really question them. Just think about the idea that renting is throwing money away – this concept stems from the idea that everyone should buy a home, which stems from the original white picket fence American dream.
Couples need to talk about their money scripts and their natural behaviors around money. When you become aware of your natural tendencies around money, you are able to navigate these difficult conversations with much more understanding. This is why I use a software called Financial DNA to help couples talk about money and facilitate conversations to create shared financial goals.
As an example, I will walk you through how Kaleigh (my wife) and my Financial DNAs differ and what this means about how we communicate about money.
Our Financial DNA
Here is an overview of our Financial DNA summary compared side to side.
There are 6 components of your Financial DNA:
- Natural Behavior Style
- Risk Behavior
- Financial Relationship Management
- Financial Planning Management
- Wealth Building Motivation
- Financial Emotional Intelligence
1. Natural Behavior Style
Your Natural Behavior provides an overall summary about your behaviors and puts you into one of ten personality styles. It certainly won’t be perfect, but it will likely hit on some key aspects of your personality.
I am a Facilitator – Facilitators are good at guiding people with feelings, yet with the determination to reach goals and accomplish tasks. They are well suited for situations where setting the agenda and recognizing the needs of other people are required. They flourish in an environment where there is plenty of stability, group decision-making is needed and where they are recognized for the contribution they make. The two strongest behavior factors are pioneer (sets direction, ambitious, committed to goals) and anchored (solution driven, focused on execution).
My desired communication includes:
- Provide me with the big picture
- Present me with the action plans
- Keep me informed of progress
- Show me the logical steps
- Tell me about past experiences
I’d say this is 80% accurate – I am very goal driven and like to set an agenda but recognize the importance of adjusting my style based upon the needs of others. I do disagree with the need for stability (obviously since I launched a company 😊).
Kaleigh is a Community Builder – Community Builders excel at meeting people and promoting cooperation among groups of people. Their natural inclination is to help and support others to carry out an activity or transaction. They are attentive to both people and tasks, and influence others through empathy and supportiveness. Once convinced of a course of action, they will encourage others, operate diligently and collaborate to achieve the goal. They seek supportive relationships that are appreciative and empathic towards one another. The two strongest behavior factors are trusting (receptive, believing, forgiving) and outgoing (enjoys new ideas, expresses views, uses a networking approach).
Kaleigh’s desired communication includes:
- Remember her desire to be included
- Keep the conversation friendly
- Expect and encourage her thoughts out loud
- Remember her need for fun and excitement
This is spot on for Kaleigh (which also confirms she is a kick-ass wedding planner!).
2. Risk Behavior
Higher scores indicate a higher willingness to take risk.
My score was 62 and Kaleigh’s score was 14. This is very common amongst couples – one is usually more of a risk taker and the other is usually more conservative.
3. Financial Relationship Management
Higher scores indicate a higher desire to delegate financial responsibilities.
My score was 42 and Kaleigh’s score was 88. This means that Kaleigh much prefers to delegate financial tasks to someone she trusts, whereas I prefer to maintain control of financial tasks.
4. Financial Planning Management
Higher scores indicate a higher likelihood to be financially organized, follow budgets and save money.
My score was 69 and Kaleigh’s score was 16. This isn’t a bad thing, but rather shows the importance that Kaleigh places on spending money on fun, exciting adventures that come her way.
5. Wealth Building Motivation
Higher scores are associated with high goal setting and people that want to ambitiously pursue goals.
My score was 99 (relax man!) and Kaleigh’s score was 31. This means that I may be overly focused on accomplishing goals, whereas Kaleigh may be more flexible with the goals we set.
6. Financial Emotional Intelligence
Higher scores indicate more emotionally intelligent investors who can more effectively recognize and balance their impulses. This is closely tied to #4 – Financial Planning Management.
My score was 69 and Kaleigh’s score was 10. Again, this isn’t a bad thing, but rather shows some of our natural tendencies around spur of the moment decisions.
So how does this help us talk about money?
Financial DNA provides a starting point for important conversations. It first brings awareness to your own natural behaviors around money and then shows how the natural behaviors of your significant other may be different. These natural behaviors have meaning behind them – both Kaleigh and I can identify stories or qualities of our parents that shaped our natural behaviors. It allows us to uncover our money scripts and talk about some of the experiences that shaped how we behave around money.
After learning our natural behaviors and money scripts, we are able to talk through how our financial decisions can be made in a way that is best suited for our personalities. This includes:
- Relaxing the standards around goal setting. This was our biggest difference which means we both need to budge – I can be more lenient around accomplishing goals, but she can recognize the importance that I place on goal setting.
- Scheduling regular checkpoints so we can review our progress towards goals, but likely in a fun, friendly setting. We should revisit whether those goals are still relevant, especially given Kaleigh’s tendency to discuss new ideas and pursue new opportunities.
- Allowing me to handle most of the financial decisions, but recognizing the importance of including Kaleigh and encouraging her thoughts.
- Talking through our differences in risk. Although Kaleigh has a tendency to be very risk adverse, her desire to delegate financial decisions and trust my judgement allows us to take more risk.
- Building flexibility into our budget for Kaleigh to spend money on spur of the moment opportunities that she finds valuable. This helps satisfy her desire to spend freely, but also my desire to stick to a budget if that flexibility is already built in ahead of time.
This is just scratching the service for how couples can talk about money. It’s important to recognize that it will be difficult – money is emotional, and we’ve never really practiced discussing it. By first understanding the natural behaviors of yourself and your spouse, you are able to create a starting point for making financial decisions together in a way that is aligned with your shared goals.
- Take the Financial DNA questionnaire yourself using this link. It only takes about 10 minutes! Just a heads up – I’ll be notified of the results and I’ll add your email to my email list (sorry, there is no such thing as a free lunch 😊).
- Talk to your significant other about how your natural tendencies and childhood experiences have shaped your views about money. Create a safe, supportive environment to share these experiences.
- Schedule regular, reoccurring times to discuss your household finances. You can either hire a financial planner to do this for you or do it yourself. If you do it yourself, I recommend that you avoid doing this at the end of the day when your mental energy is drained. Prioritize these conversations and have them while you are fresh and present. If you have kids, try to get out of the house.
- Assign roles and responsibilities to each person. Who is responsible for keeping the budget? Who is managing the investments? Who is tracking your progress towards goals? This is a big reason why people want to work with a financial planner – you delegate the majority of your financial concerns and responsibilities to them.
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