57% of surveyed U.S. adults say the pandemic has increased financial stress in their relationship.
Financial stress is most prevalent among younger generations; almost two in three (65%) partnered Millennials and Gen Zers say the pandemic has increased financial stress in their partnerships.
But many people steer clear of financial conversations; nearly 4 out of 10 (39%) adults avoid talking about money with a romantic partner.
This is most true among Millennials, with 44% of this generation agreeing with the statement, “I usually avoid talking about money with a romantic partner.”
Honesty and equity are the most valued qualities in a romantic partner, as 58% say they would end the relationship if their partner was being dishonest about money/their spending, and 32% would call it quits if their partner never/rarely offers to pay for things.
For those who say debt is a deal-breaker (29%), having debt in the tens of thousands is considered by most to be too much debt.
Millennials, we need to talk.
A recent Personal Capital survey* fielded by Morning Consult found that nearly half of Millennials (44%) avoid discussing money with their romantic partners.
Of note, this age group would likely benefit from an honest chat; 65% of partnered Millennials say the pandemic has increased financial stress in their partnerships.
“Money overall is still a taboo conversation for many people,” says Krista Aliga, CFP®, a financial advisor with Personal Capital. “If your finances are stressing you out, it’s even more important to be having these conversations.”
Aliga adds that people in this age group are likely experiencing major life transitions in the midst of the pandemic – getting married, buying a home, having kids – which could make tension more acute.
“To help ease stress when you have joint finances, I’d advise transparency,” Aliga says. “It’s natural to want to close yourself off, but being open and honest with your partner about your concerns and stresses will help you work through them.”
How to Have the Money Talk
Talking about finances will be different throughout your relationship. Your financial conversations will expand based on numerous factors – how long you’ve been together, what your goals are, and how much you pay attention to your own personal finances.
As you and your partner begin talking more regularly about money, consider the following best practices.
1. Leave judgement at the door.
When talking about money, try to remain open-minded, particularly if you’re unfamiliar with your partner’s inherited money attitudes.
“Everyone has different biases with finances,” Aliga says. “Keep in mind that your partner likely had a different financial formation, which can impact how they feel about money.”
According to a 2020 Personal Capital survey, 76% of respondents said their parents influenced their current financial practices. How you’re raised can certainly impact your mindset, but it doesn’t need to determine your choices. To get an understanding of how your partner first related with money, ask open-ended questions:
What’s the first conversation you remember having about finances?
How did your parents talk about money in general?
What was your parents’ spending style?
What are some of your earliest memories around credit cards and debt?
How did you learn about saving? What about investing?
As your partner shares this information, stay neutral and curious. Understanding where you each come from can help inform how you move forward together.
2. Commit to frequently checking in.
Setting a framework for when you’ll talk about money can help ease stress, as you’ll both know what to expect.
Once you’re in a committed relationship, Aliga recommends starting off by touching base weekly on your cash flow and budget. As you continue talking through your finances together, your conversations can occur on a less frequent basis. Be sure to maintain consistency.
“Once a month is appropriate for almost any couple to review the prior month and check in on upcoming goals,” Aliga says.
3. Keep it casual.
Talking about money can get tense – especially if you or your partner has struggled with financial insecurity at some point in your life. As you set up regular check-ins, keep stress at bay by staying as relaxed as possible.
“Get coffee, go on a walk,” Aliga says. “Try getting out of the house and being in a casual environment; it’ll help open up the conversation.”
4. Focus on goals.
Expressing your goals will help you visualize what’s important to each of you.
“Goals make conversations more meaningful,” Aliga says. “For instance, if you set a goal attached to your budget, you’ll be more driven to see it through. Otherwise, the ongoing conversations could feel like touching base without purpose.”
Here are a few topics to consider for your regular money dates:
Monthly cash flow and budget goals (i.e. sticking to a 50-30-20 budget)
Short-term goals (i.e., going on a vacation in a few months)
Mid-term goals (i.e., buying a new car or saving for a home down payment within the next few years)
Long-term goals (i.e., career advancement, debt paydown, retirement planning)
When you talk about each of these goals depends on your comfort level. Sharing long-term goals is likely the most challenging; 44% of adults we surveyed don’t think it’s appropriate to talk about retirement plans until they’re already married.
However, Aliga cautions that may be too late. She says that it’s best to talk about retirement plans before marriage to make sure you are both on the same page.
“What if one person wants to retire in their hometown and one wants to retire abroad? It’s about sharing these goals together,” she says. “This doesn’t mean disclosing everything you have – it’s more about getting a general sense of where you each see your lives 20-30 years from now. How do your long-term visions align?”
She adds that you should both come to the understanding that your long-term goals may change. “Even if it’s not set in stone, it’s a worthwhile ongoing conversation for committed couples,” she says.
5. Bring in backup.
If you’re finding that talking about money is stressful, a financial advisor can be a good mediator.
“An advisor can help guide and moderate some of those tougher questions, like how to pay off debt or achieve long-term goals,” she says. “Having an advisor as part of the household team helps both partners feel equally looped into their financial situation.”
Also, online financial tools can give you transparency in talking through your finances together. Aliga recommends Personal Capital’s free money management tools.
The app can be part of your money dates: “Getting that ongoing visibility can help prompt conversations around short-term budgeting goals and longer-term goals like retirement,” she says.
Why Talking About Money Is Important
In the early stages of a relationship, being honest about your finances can help set a solid foundation. The most valued qualities in a romantic partner are honesty and equity, as 58% of our survey respondents say they’d end the relationship if their partner was being dishonest about money/their spending, and 32% would call it quits if their partner never/rarely offers to pay for things.
When you’re dating someone new, the first money conversation you’ll likely have is around who picks up the bill. And this is an important consideration for many people; 32% said it’d be a deal breaker if their partner never/rarely offers to pay for things. This is most true among Baby Boomers (37%) and women (44%).
Aliga says honesty is the best policy.
“In a healthy dating relationship, it all goes back to transparency,” she says. “If your partner doesn’t offer to pay and you aren’t honest about how that makes you feel, the situation can really spiral into an additional stressor. Opening the conversation may reveal that your partner has financial stresses that you may not have been aware of.”
She adds that the conversation doesn’t need to be confrontational or intense. Instead, try proposing low-cost dates, or suggest trading off who plans and pays for dates.
No Debt About It
Debt has become a normal part of Americans’ financial lives; the average American now carries about $38,000 in personal debt, excluding home mortgages. According to the 2022 Wealth & Wellness Index, paying down personal debt is the top 2022 resolution for U.S. adults.
“Debt is certainly a contributing factor to stress in anyone’s life – regardless of whether they’re in a relationship or not,” Aliga says.
If you’re carrying debt, you’d be wise to gauge your partner’s comfort level; 29% of adults we surveyed said debt could be a deal breaker, especially if it’s in the tens of thousands.
Early on in your relationship, be open about how you think about and manage debt, even if you don’t get into specific numbers right away. Once you’re in a committed relationship, shift the conversation to strategy.
“If you are creating goals together, be as transparent as possible on what your goals are with that debt and how you plan to pay it down. Creating a plan depends on the type of debt, how much debt, and who’s carrying the debt,” Aliga says.
Again, Aliga emphasizes the value of honesty: “The more that couples can be transparent in these conversations, the more beneficial it will be to their relationship.”
*Survey Methodology: This poll was conducted by Morning Consult on behalf of Personal Capital, between January 15-January 16, 2022 among a sample of 2,210 U.S. adults. The interviews were conducted online and the data were weighted to approximate a target sample of Adults based on gender, educational attainment, age, race, and region. Results from the full survey have a margin of error of plus or minus 2 percentage points.