Even though my husband and I were born on the same day, we have completely different personalities. Our money personalities are about as different as you can get.
I'm a spender; he's a saver. My goals are big and lofty; his tend to be more moderate and short term. I'm a risk taker; he is always considered in his decision making. Despite our differences, though, we have managed to maintain a strong relationship, with money and with each other!
Many couples assume that because they are compatible in all the important areas, dealing with money will be easy. But money is a particularly emotional issue and has proven a minefield for countless couples over the years.
There is no straightforward answer as regards dealing with money and joint finances but some simple steps can help achieve financial compatibility.
The first step is to talk about money as thoroughly and openly as possible before you combine finances (but it is never too late).
It is important that you each understand your money personality and what money means to you. You might find the thought of taking on debt absolutely terrifying. You might need to know where every dollar came from and where it went.
Your partner might think it is important to have some discretionary money and not have to account for it. Neither of you will necessarily be right or wrong, but it is important to know how each other feels about money, so any emotional baggage can be unpacked and dealt with.
The next step is to consider your respective money habits. You might be better at paying the bills and keeping track of spending, whereas your partner might be better at establishing the plan (and the budget) to achieve long-term financial goals. The important thing is to understand each other's habits, acknowledge the bad ones and make the most of your respective strengths.
Agreeing on goals is really important. I remember a couple who had completely different ideas as to what they wanted long term - he wanted a certain dollar amount to retire on, whereas she was happy to live frugally in retirement and use every spare dollar to get her kids through university and into their first home. Again, by talking and understanding your respective money goals, you'll be in a better position to satisfy both objectives.
One step that is often overlooked by couples in their quest to achieve financial compatibility is to allow for a bit of "wriggle room" - flexibility to allow some independence.
When planning finances, it is easy to focus on the things that need to be done - agree how much to spend, how much to save, what to spend your money on and when it will all happen - and ignore the things you might want to do.
Years ago, we sold a house and "traded up" to a nicer house, with a much bigger mortgage and double-digit interest rates. I wanted the house as much as my husband did, so was prepared to cut back my spending in order to put a dent in the mortgage (and buy the extra furniture needed for the bigger house).
It was hard work, and after a year or so it became quite demoralising having no surplus funds - and no meaningful reduction in our mortgage. We agreed to loosen the strings a little and have the occasional dinner out and I was allowed to buy the occasional outfit. Funny, I can't remember what I agreed that my husband could do with the loosened purse strings but I'm sure he was happy with it!
Few things are more personal than personal finance and everyone will be different. But a lot can be achieved by openly discussing and agreeing on a system that works for you, for the good of your financial wellbeing and your relationship.
-This column is presented in association with Fisher Funds.