Talking about money in your relationship is important.
So how do you ensure that your budget meetings are effective and don’t turn into a shouting match?
Here are 6 things we do to stay on task.
Podcast And Transcript
Michael Lacy 0:00
What's up? What's up? What's up teammates, Michael, from winning to wealth here from money talk Monday, number 31. And this week, we're going to be talking about how you and your spouse can have better money conversations. sitting down with your spouse and having a regular scheduled time to talk money is so important. In fact, it's the key habit that's allowed us to pay off $61,000 worth of debt, build a six figure net worth and so much more just since 2014. So what are the keys to having better money meetings with your spouse? Well, let's talk about it.
The first step to having better quality budget meetings is making sure that they're scheduled and consistent. One of the worst things you can do is try to force somebody to talk about budgeting and money, especially if that person just isn't passionate about managing money as you are a recipe for disaster like every single time. Instead, what you can do is present a few date and time options and ask if that works for them every single month. You also want to have a time limit set and you want to stick to it unless you both agree to extending it for that one particular budget meeting. We try to keep ours to about 30 minutes. And since they're so short, this means that I finished the previous month's budget beforehand. And I try to get it to tailor to look over at least 24 hours before our budget meeting. So for an example of how this all works, like I came to Taylor and said, Hey, I'd really like to sit down and just discuss how we did with our money this month, and then we can finalize a plan for the next month. Can you agree to sitting down with me at eight o'clock on the last Sunday of the month for 30, maybe 45 minutes, and once she committed we put it on the calendar and I started getting the budget done by the previous Friday. She had some time to look at it and think of any changes that she'd like to make. Now, not only does this keep the whole thing short and painless, but it gets her involved in the process. So before we started budget meetings, I was always having to go back and adjust the budget during the month for things that she would try to buy. Now what happens is she comes to the meeting with a list of things she needs, and we adjust the first draft to fit around those needs. And I'll tell you, that eliminates a ton of money fights in marriage. Now I know this may sound all formal and stuffy, but I promise you it's not it not even close, which is why the second tip for having better budget meetings is to keep it fun. In fact, we don't even call them budget meetings in our house. We actually call them dream sessions because one, the name budget meeting just sucks and it reminds me of work and to everything we discussed is about moving us closer to our dreams. So it just naturally fits and that's what's actually on our calendar. And so not only does the name help, but we make sure that we have like some good stuff. Like a favorite candy or a dessert, and usually a bottle of wine. Now, I'm not a huge wine drinker, but Taylor really enjoys it. So that's just like one little trick I've got in my back pocket that I can use to keep her coming back every month. But you have to find ways that make it fun for both of you. I've heard of other people doing things like going straight into a date night afterwards, where maybe they pull out some board games or something. Other people do their budget meetings, like outside on a patio or a back deck. But don't be afraid to switch it up and find what works best for both of you. It doesn't always have to be a bunch of spreadsheets brought across the kitchen table. Like I'm a money nerd. And even I'll admit like there's nothing sexy about that at all. So keep it fun, but also that means keep it positive. Like this is not the time to belittle your spouse or make them feel bad for their mistakes. Like Yes, you want to hold them accountable when you both agree to something and it isn't done, but correct them and hold them accountable in a loving way like you both are a team so act like you're on the same team working for the same goal and not enemies. who are trying to one up each other or do sneaky things behind each other's
Now this third tip for having better budget meetings is really important for moving your budget meeting forward. And this tip is to eliminate the distractions like this is not the time for one of you to be watching the TV or cooking dinner or anything else. This is the time to track your progress toward the life of your dreams. So get rid of everything that can take away your focus. This could even mean that you take your phones and you put them in the other room for the 30 or 45 minutes or however long you both agree to meet. Like I said, distractions slow the process down and you need to make sure you stick to the time limit that you sit so make sure that you both are committed to actually listening to one another and giving each other your full undivided attention on how to make a plan that works best for the both of you. So you show up on time to the meeting. You've got the wine, you've got the peanut m&ms. You put the kids to bed, you've turned off the TV. Now it's time to finalize the budget. For the current month or the current pay period. And so there are a few things you need to do here. Number one is you need to make sure that every transaction has been accounted for. So for this step, one of us pulls up the bank account and the other one pulls up our budgeting app. Whoever pulls up the bank account then reads off the transactions while the other person verifies that each transaction is in the budget. Even season budgeting pros like ourselves forget to add transactions from time to time, especially those of us who have toddlers that sometimes have public meltdowns, and we're just trying to get out of the store and get to the car as fast as possible. It's very easy to forget to add a transaction in the budget when that happens. So yes, it happens to us. So take the time and just go through and verify that everything's in there. The next thing we do is make sure the income is accurate. And this is usually pretty simple because it's usually like four or five transactions, but there have been times where we've gotten like a refund check for some service that we did or you know, something like that. And we totally forgot to add it. So just double check that everything is accurate. Everything is accounted for under the income section. Now, once we have everything lifted and everything verified, then we decide what to do with the excess money we have. So sometimes you just overestimate a spending category and there's a little money left over. And so the questions you need to ask is like, does that need to be saved this month? Or do we need to move into a category where maybe we overspent or maybe we put it towards debt, the money has to have a home, it has to have a responsibility. So take a little time to discuss where the best use of any extra money from a category should go. And finally, this is also the time to point out any trends that you're noticing. So maybe this is the third month in a row that you guys have overspent on restaurants, then it's definitely time to discuss whether you're being unrealistic with the budget, because sometimes that happens, or maybe you can come up with a way to keep from going over the next month. So you talk about that and you try to find a way that works for you both and then you try to implement it. Now once we have the numbers finalized for the current month or the current pay period. We track our progress towards our money goals and we set new goals. And so for this, I recommend that you use the monthly recap form on my website, which you can find at winning to wealth comm slash recap, but this form shows how much we saved and invested that month, how much debt we paid off how much debt is remaining, even tracks our net worth, there's a spot at the bottom where you can list like four goals that you have for the next month. And there's another spot where you can share the progress for the goals that you had for the current or the previous month. And so if we hit a goal, we take a moment to celebrate that or if it's a big goal, then we plan out some kind of celebration. And if we're off track, then we can easily spot it and talk about ways that we can correct it going into the next month. So I created the forum to really help us have better money conversations and steer towards our goals. And once I realized like how effective it is I made sure to get it up on the site so again, go check that out at winning to wealth comm slash recap.
Alright, so I already mentioned how I sent Taylor the budget before the meeting, and I believe Let her really sit with it for a while so she can bring her input to the meeting. Well, once she shows up to the budget meeting, then we actually make adjustments based off the input, like, don't just let her pull the budget and get her input and don't do anything about it. Now, this is also the part where things can kind of go off the rails if you're not careful if you're not positive, or if you haven't done really the things that we've talked about beforehand. So a lot of times us money nerds want to get our spouses like 100% on board with our plan in the way we do things. And that's just not always a realistic expectations. It's not a healthy expectation to have, like your best bet is to let your spouse continue to grow, continue to have the things that they enjoy, and meet them where they are. Now, that doesn't mean again, we won't challenge them, but it does mean we hear them out and we actually consider their input. Again, after all you two are on the same team working towards the same goal. So act like that your teammate. So here's an example. Let's say you set the dining out spending to like 100 bucks, but your spouse really enjoyed lunches out with coworkers. So they come back with a recommendation of $200. Now, instead of jumping down the throat, you first thanked him for participating in the process, and then ask them where they think that additional money should come from. So something like, Hey, thank you for your input on the budget. By the way, you know, I noticed that you raised the dining out spending, is there something on your calendar that maybe I'm unaware of ask questions, and then really listen and try to understand their thought process behind the change that they made first. And so once they respond with their reason, it's time to really figure out where, where they think the money should come from. And so don't be afraid to speak up about a category you're really passionate about by saying something like, okay, so I'm willing to compromise and raise the restaurant spending so you can have your weekly lunch with your co workers. But it's important to me that we stick to the debt elimination goals that we set last month. So can you help me find a different category where this money can come from? And so from there, we both try to find a way to help the other one. It's something that's important to one of us, so maybe I can buy like one pair of pants instead of two this month so that you can have a lunch with your co workers. Or maybe you can cut out the gas station snacks. And that'll give you to have the lunches that you want it for. And so sometimes you'll end up at like 150 instead of the 200 your spouse want it. But you both compromised, and you both are getting things done are important to you. And that's what this is all about. The spending plan isn't about restricting you. It's also not a tool that you can weaponize to make your partner feel guilty for the things they like to enjoy. a spending plan is to help you both live a life of freedom by prioritizing the things that mattered the most to you both. Sometimes that may mean cutting out some fun things. Other times it's cutting back on some fun things. And sometimes you'll just have the flexibility to go out and have a blast. But when you do, you get to enjoy yourself without any of the guilt in any of the other negative emotions that come when you spend recklessly and you aren't moving yourself towards any goals. So if you want to have better budget meetings, I want you to commit to the process that we've laid out today by following everything that I laid out. out here, we've eliminated pretty much all of the money fighting for my marriage. And a reminder head over to winning to wealth comm slash recap and grab the monthly recap form. This form is really just a great way to keep track of your progress every single month. And it's just going to help you have better money conversations with your spouse, it helps them be more efficient, helps them be more a little more guided, a little more structured. Also, if you're looking for a sense of community, head over to winning to wealth, comm slash teammates and join my private Facebook group where we talk all things money all the time. That's winning to wealth, comm slash teammates. But hey, that's all the time I have this week. So until we talk again, keep racking up those wins one at a time. Take care
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Keep Them Scheduled And Consistent
One of the worst things you can do is try to force someone to talk about a budget at a random time- especially if that person isn’t as passionate about managing money as you are. Recipe for disaster every single time.
Instead, present a few date and time options and ask if it works for them every month.
You also want to have a time limit and stick to it unless you both agree to extend it. We try to keep our budget meetings under 30 minutes.
Once you both commit to a date and time, put it on the calendar.
Not only does it keep the whole thing short and painless, but it gets your spouse involved in the process.
Before we started budget meetings, I was always having to go back and adjust the budget during the month for things she would try to buy.
Now Taylor comes to the meeting with a list of things she needs and we adjust the first draft to fit around those needs and that eliminates A LOT of money fights.
Keep Them Fun
We don’t even call them budget meetings in our house. We call them Dream Sessions for two reasons:
- The name budget meeting reminds me of work.
- Everything we discuss is about moving us closer to our dreams.
We also make sure we have some good snacks like a favorite candy or dessert and usually a bottle of wine. I’m not a huge wine drinker, but Taylor enjoys it so that’s just one little trick I use to keep her coming back every month.
I’ve heard of other people going straight into a date night with board games afterward while other people do their budget meetings outside on a patio or back deck.
Don’t be afraid to switch it up and find what works best for both of you. It doesn’t always have to be a bunch of spreadsheets sprawled across the kitchen table.
I’m a money nerd and even I’ll admit that’s not sexy at all.
Keep it fun also means to keep it positive.
This is not the time to belittle your spouse or make them feel bad for mistakes. You want to hold them accountable when you both agree to something and it isn’t done- but correct them and hold them accountable in a loving way. You both are a team.
One thing you don’t want is one spouse focused on the budget while the other is focused on their phone or a show on TV.
This is a scheduled time to track your progress towards the life of your dreams so get rid of everything that takes away your focus.
Distractions not only slow the whole process down, but they can lead to anger and frustration.
So to have a great budget meeting get the kids to bed, turn off the TV, and make sure you both are committed to listening to one another and focusing on how to make a plan that works for both of you.
Finalize Last Month’s Budget
There are a few things you need to do when it comes to finalizing the previous month’s numbers.
- Make sure every transaction is accounted for. For this step, one of us pulls up the bank account and the other pulls up our budgeting app. Whoever pulls up the bank account then reads off the transactions while the other person verifies that each transaction is in the budget. Even seasoned budgeting pros forget to add a transaction so take the time and just verify everything.
- Make sure the income is accurate. This is pretty simple because it’s usually like 4-5 transactions, but there have been times where we’ve gotten like a refund check for some service in the mail and forgot to add it so just double check that everything is accurate and accounted for.
- Decide what to do with any excess money. Sometimes you just overestimate a spending category and there’s money left over. Does that need to be saved this month? Do you need to move it to a category where you overspent? Or maybe you use it to pay off debt. The money has to have a home so use a little time to discuss where to best put it.
- Point out any trends you’re seeing. Maybe you notice that this is the 3rd month in a row that you’ve overspent on restaurants. This means it’s time to discuss whether you’re being unrealistic with your budget or maybe you can come up with a way to keep from going over next month. Find a strategy that works for you both.
Celebrate Any Wins
We use the monthly recap form found here to keep track of our goals and progress towards any milestones.
If we hit a small goal, we take a moment to celebrate that.
If we hit a big goal or milestone, we plan out some kind of celebration.
If we discover that we’re way off track and not even close to our goals, we can address the problem, find a way to correct it, then move forward.
But keeping track of your wins and celebrating them is a fantastic way to stay motivated on what could be a very long financial journey.
Finish Next Month’s Budget
Now, this is the part where your budget meeting can go off the rails if you’re not careful.
A lot of times us money nerds want to get our spouse 100% on board with our plan and the way we do things, but that’s not always a realistic expectation. Your best bet is to let your spouse continue to grow.
That doesn’t mean we won’t use the budget meeting to hold them accountable, but it does mean we will hear their logic and consider their input- after all you two are on the same team working towards the same goal.
So here’s an example- let’s say you set the dining out spending to $100. But your spouse enjoys lunches out with co-workers so they come back with a recommendation of $200.
Instead of getting upset, thank them for participating in the process and then ask them where they think the additional money should come from.
Something like “thank you for your input on the budget by the way. I noticed you raised the dining out spending. Is there something on your calendar that I’m unaware of?”
Then listen and try to understand their thought process first.
Once they respond with their reason, it’s time to discuss where the money should come from.
Don’t be afraid to speak up about a category you’re passionate about by saying something like “Okay I’m willing to compromise and raise the restaurant spending so that you can have a weekly lunch with your co-workers. Keep in mind that it’s important to me that we stick to the debt elimination goals we set so can you help me find another category where the money can come from?”
Then both of you try to find a way to help the other.
Maybe you can buy 1 pair of pants instead of 2 this month and maybe your spouse can cut out the gas station snacks. Whatever works for both of you.
Sometimes you’ll end up at $150 instead of the $200 your spouse may have wanted, but you both compromised and you both are getting things that are important to you and that’s what this is all about.
A spending plan isn’t about restricting you. It’s also not a tool you can weaponize to make your partner feel guilty for the things they like to enjoy.
A spending plan is there to help you both live a life of freedom by prioritizing the things that matter the most to you both.
Sometimes that means cutting out some fun things, other times it’s cutting back, and sometimes you have the flexibility to go all out and have a blast, but, when you do, you get to enjoy yourself without any of the guilt and other negative emotions that come when you spend recklessly and aren’t moving toward any goals.
So if you want to have better budget meetings, find a process that works for you and commit to it.
What do your budget meetings look like?
Head over to my private Facebook group and share your process every month or pay period.