A year ago today, a guy called Freddo sent me a message on the online dating site RSVP. His real name is Neil, and we are getting married in September. A large part of why we feel so blessed and happy is that we share similar values, including about money.
Values. And money. As I have written previously, the importance of values is a lesson that I learnt the hard way. Managing money successfully is not actually the dollars and cents (or should I say sense), but rather the values we place around money.
This is because we come to a new relationship with different money conversations that we grew up with. In my household, my mother was a successful businesswoman. She loves residential property and at home we talked about buying and selling property all the time. I did not grow up expecting a knight in shining armour to take care of me, and consequently, I did not look for that in my relationships. Nor did I plan to take a lot of time off to be with my children when they were young. To be honest, at the time I didn’t even consider it because I had never experienced that traditional role of having a mum as a homemaker. Instead, I have a powerful mentor who made me believe that I could achieve anything I wanted to as a woman.
Neil’s parents had four children at a very young age. They didn’t have a lot of money growing up, but they made do. His Dad was serving in the navy during the Vietnam war when he and his sisters were young, so his mum did much of the work of raising them when they were little. She had friends and family nearby. They didn’t have a lot of ‘stuff’ as they couldn’t afford a lot, but they did have a lot of love. His parents retired in a modest but comfortable fashion, with no mortgage, no debt, and defined benefit superannuation and a veteran’s pension that allows them to go on cruises at least once a year. Neil also started a family he was young. His conversation about money is more conservative than mine, but we are similar in that we both value family and financial security over flashy toys and ‘stuff’.
One of the things that I found attractive is that he shares my frugal values. We share the same tea bag when making each other a cup of tea in the morning. We happily go on dates where we use Entertainment Book specials, or we stay at home and have karaoke Fridays with a homecooked Fridge Friday leftover meal and a bottle of $5 award-winning rose from ALDI. He comes op shopping with me. We talk openly about our retirement plans (he has convinced me to retire early with him), and we have started investing together.
Money is one of the biggest sources of friction in many relationships, especially in affluent countries such as Australia. Yes, money seems to create more tensions when you have it than when you don’t, at least it does with relationships. I think this is because the more money you have, the more expectations there are that it should be spent pursuing a certain lifestyle. When you have children, there is also tension about what to spend on the children, and also whether a parent should stay at home and if so, for how long.
This graph comes from Greater Australia Bank’s report into Australian Attitudes towards Money and Relationships. They conducted a review earlier this year into what Australians think about money.
Would you date someone who earnt less than you? This is an interesting question for me to ponder as in my previous marriage I earnt more than my husband, and yes, that caused friction. According to the results of the survey, 1 in 8 Australians would not date someone who earnt less than them. But money isn’t everything: three-quarters of respondents would prefer a partner who was poor but attractive, versus rich but unattractive. I guess having a Sugar Daddy isn’t everything.
According to the survey, one in 20 Australians feels uncomfortable talking about finances with their partner. This does not surprise me (I thought the rate might be higher), but still, I find it shocking. The fact that you can be in a relationship with someone and share so much – have children together and even buy a house – yet not feel comfortable talking about money is scary. This is especially the case when you consider that the same report identified that nearly 1 in 5 Australians (19% ) have experienced a relationship breakdown due to money. This can easily lead to a phenomena known as sexually transmitted debt.
Discussions about money and investing tend to assume rational behaviour. Financial plans chart off into the distance based on assumptions that we will continue to invest in logical and consistent ways. But when we are in relationships, especially relationships where our money values are not in sync, we tend to act in illogical ways. Maybe we avoid talking about money, or assume the other party is providing for us, or blame the other party for spending too much (even as we go shopping ourselves), or let the other person make the decisions so as not to rock the boat. Or we spend too much trying to make the other person happy, or we don’t make savings or investment decisions that we think we should because we worry the other side might not agree. We buy that caravan the other person wanted (or we think they wanted), or we spend up big at Christmas to try to impress the in-laws. Or we go guarantor for a loved partner in a business because we really want to support them and for them to succeed, never thinking that our own future could suffer if things go bad.
So many aspects of relationships are peppered with marketers telling us we need to pay money to buy happiness. Whether it is online dating sites, expensive dates, long stem roses, diamond engagement rings, big weddings, or romantic holidays, the marketing world tells us that money does buy you love and you need to spend, spend, spend if you want to be loved. Is it any wonder that sitting down and doing a budget together to cost out how much this all costs can be scary. Deep down many of us are scared that we might not be loved if we do not have enough money.
For me, I much prefer that cup of tea with the shared tea bag every morning and the joy of building a simple but loving life together. It is the small things to me that make a relationship – the shared laughs, meals together, ability to negotiate differences so they don’t turn into conflict, and crucially, showing an interest in the things that are important to the other person. Research on what makes a successful relationship by the Gottman Institute shows how showing interest in the other party (turning towards instead of away) is crucial to a happy and longlasting relationship. A happy relationship has nothing at all to do with how many carats are in a diamond ring, and the positive goodwill engendered by treating your other half well will last long after long-stemmed red roses have faded and died. And best of all, it costs very little.
What money values do you bring to your relationship? Do you have similar money values to your partner? If you don’t have a partner, what money values are important to you?