Why We Fight About Money

Why We Fight About Money

As seen in Fidelity on August 5, 2021

If you had more money, would it solve all your fights about money? Maybe some of them, if you and your significant other are at odds only because of a scarcity of resources in your household.

Because money fights can be really be about any underlying dynamic in a family, they run the gamut. For instance, there are sometimes fights over power in a relationship, according to research by Sonya Lutter, a professor of applied human sciences at Kansas State University.

She has found that with heterosexual couples, wives report money conflicts when there is a lack of communication, while husbands report that arguments increase when there are more children. She also has found that when the husband makes more than the wife, the arguments are less, but when a woman makes more, the arguments increase, regardless of net worth.

"Those issues are not going to go away with $5 million or $500 in assets—the same issues are related to our traditional gender stereotypes," says Lutter.

Sometimes a family that seems at harmony because they have enough money is actually just delaying conflict until later in life. When they finally sit down with a financial professional to talk about retirement strategy and estate planning, they figure out they are not on the same page, which they never knew because they might never have talked about it.

Values

Not being on the same page about money values is something that happens at all income levels. Kaiman breaks it down to things you can do with money—save it, spend it, invest it, and give it away.

"When I see couples get into fights, it's because one is valuing one of those elements at a different rate," says Kaiman. 

One step to facing the conflict is not to think of it as something that needs to be resolved, but rather, something that couples need to discuss openly and understand about each other.

In this way, couples can view disagreements about money as an opportunity to get to know each other in new ways, to grow closer, and to co-create a shared perspective for the future. This is particularly important because we all grow and change through time. People change. Circumstances evolve. Families grow and move through life stages.

They couldn't agree on a mutual decision to meet in the middle somewhere, so they swung this way and that, following the volatility of the market at the time of their appointments. That is, until the husband retired and his values started to align more with his wife's, and they settled on the more conservative path.

Legacy

Another area that causes strife is when a couple starts to think about giving away their assets. Couples often have an expectation that they need to end up with the same thinking.

This approach tends to prompt a debate about the relative merits of different options and often leads to each person asserting their own view. Agreement-driven conversations also tend to be judgment-based, with a focus on assessing a choice as "right" or "wrong." This approach often leads to reactivity, a heightened emotional state that can be triggered if someone feels their views or values are being challenged.

But there are a lot of options with legacy planning that can accommodate shared solutions. It all starts with dialogue—sometimes a lot of it—to find out everyone's needs and wants. Then strive for alignment rather than agreement.

Pirone-Benson recently met with clients who were struggling with their feelings around leaving an inheritance to their children in a blended family. The husband wanted to make sure he left money to his 2 children from a prior marriage, while the wife wanted to prioritize the daughter they had together.

Working with their attorney, they ended up coming up with a solution involving marital trusts that worked for everyone. Should he die first, the husband would leave his estate to his wife in a marital trust. The wife would be entitled to the income from the trust and access to the principal only for health. Then upon her death, the remaining trust assets would be split in thirds among the children.

If the wife dies first, her assets will be split among her daughter and her husband, and he would then leave his remaining assets in thirds to the children according to his wishes.

Click here to read the full article.