How Money Can Complicate Relationships, Especially In An Expensive City When it comes to finances, there are some issues that most commonly doom a romantic partnership. And the pressure of trying to afford living in an expensive area can cause bigger disagreements.
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How Money Can Complicate Relationships, Especially In An Expensive City

How Money Can Complicate Relationships, Especially In An Expensive City

According to a SunTrust Bank survey conducted online by Harris Poll, 35% of people who experience stress in their relationship blame finances. Jonathan Cutrer/Flickr hide caption

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Jonathan Cutrer/Flickr

Kate and Stuart have been together six years. They live together in Northwest D.C. and own a small tourism business. In many ways, the couple says they are in unison. But, according to Kate, the two are polar opposites when it comes to one important subject: money.

"I've always had the mindset of: 'We'll find the money, we'll make it work, we've got to pay attention to numbers,'" Kate says. "He's completely ignorant about money and budgeting and taxes."

This is a common issue. It's estimated that one in seven Americans ends a romantic relationship because of money — specifically over unresolved financial issues with their partner. Research also suggests that 70% of married couples argue about money more than any other topic.

And it can be worse in an expensive area like Washington, where home prices and childcare costs are some of the highest in the nation. Living in a region of plenty, surrounded by people who seem more comfortable, can heighten a couple's insecurity around finances and lead to big disagreements.

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"There are lots of people in [this] area that make lots of money, and you're looking around and thinking well, why can't we have that house? Why can't we have that car?" says Michelle Singletary, a personal finance columnist for The Washington Post. "And so there's that financial competition that plays into a relationship that's probably already broken financially."

Kate, 27, says she was broke when she met Stuart and, though she's making more money now, maintains a frugal lifestyle. So, she says, conversations about money can be tense for the pair.

'We Come From Different Backgrounds'

We're referring to the couple by their middle names, so Kate could speak candidly about their personal finances.

Kate, who is from Arkansas, says it was difficult to adjust when she moved to D.C. in 2013. It was especially hard to blend finances with Stuart, 35, because the two had different relationships with money.

"His family is wealthy and travels the world [and] my family has scraped by and had some hard times," Kate says.

Singletary says money issues often stem from a lack of communication at the beginning of a relationship. Money can be hard to talk about, especially when you're just starting a relationship. But knowing a partner's financial backstory is key.

"People don't dig deep enough. They don't ask the right questions when they're dating — and those are the things that are going to be able to keep you from having conflicts," Singletary says.

Compatibility doesn't necessarily mean that both parties are frugal savers or lavish spenders. You just want to be sure "that you share the same financial values," Singletary says. And figuring out those values early on is key.

3 Common Money Mistakes

    Hiding Money — It may seem harmless at first, but keeping a savings account or stash of cash hidden from your partner can be your downfall, once your significant other catches on. Still, most people are guilty to some extent. In two out of every five couples, one spouse admits to lying to his or her partner about money, according to a 2018 survey by the National Endowment for Financial Education.

    Hiding Debt — Even worse is keeping debt (especially large amounts) and credit card accounts from your partner. According to Singletary, it's important to have early conversations about what you have and what you owe.

    Overspending/Underspending — To ease the stress of not seeing eye-to-eye on spending, Singletary says couples can agree to a certain level of saving. At the same time, if one person in the relationship is too tight with the finances, problems can still arise.

Prenups: The New Norm?

If a marriage ends, the financial dissolution can be messy. Increasingly, millennials are turning to a contractual backup plan: the prenuptial agreement.

Lawyers across the country have reported seeing an increase in younger clients who are open to prenups. One suspected reason is that this generation tends to wait until later in life to get married, and they may have accrued more assets they want to protect in case of a divorce. Putting off marriage means that they have a chance to build up their 401(k) or to aggregate wealth through an employer's stock program.

Others choose prenuptial agreements because they are the children of divorce. After suffering the pain of watching their parents go through a difficult process, they may be seeking to protect themselves from a similar situation.

For now, though, Kate says, she and Stuart have no plans to write up a prenup.

"If we get incredibly rich that way then sure we can discuss that," says Kate.

Financial Tips To Keep Couples On Track

Singletary holds monthly financial workshops and provides budget counseling for individuals and couples. And though she's helped hundreds of clients, she says people generally don't seek financial counseling as often as they should.

"In the D.C. area, lots of women earn more than their husbands — and that's a problem. It's not that they earn too much, it's more like, what is it about that husband that makes him less secure that his wife would be making more? And if all the money is in one pot, does it matter what she's making?" Singletary says.

Sitting down with a professional can be a great way to unpack your past so you don't go into a relationship with too much baggage. And Singletary's go-to piece of advice for newly minted couples? Pull each other's credit reports and examine the scores.

"If you do all the due diligence: you pull credit reports, you ask the right questions, you meet the family, it's very unlikely that you're going to be shocked or surprised by some con person," Singletary says.

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