Love, money go hand-in-hand, maybe more than we realize

In a case of opposites attract, love and money are quite the couple.

It’s sometimes a flashy relationship, a twinkling diamond engagement rock for all to see.

Other times, it’s volatile and tumultuous.

It can be even tawdry, according to one recent by a insolvency trustee firm in its pitch to promote its services with a Valentine’s Day theme.

Yes, Bromwich+Smith used the edgy adjective to discuss how after two years of lockdowns, perhaps financial disclosure is the new intimacy.

“When you’re doing that romantic dinner with wine, chocolates and flowers for Valentine’s Day, of course, everything is sweet and lovely,” says Laurie Campbell, director of client financial wellness at Bromwich + Smith in Toronto.

And nothing would enhance the romance like discussing $30,000 in credit card debt… right?

Yet someday, for most relationships, ‘the talk’ comes up.

If it doesn’t, the sometimes tense relationship between cash and cupid is likely to boil over eventually.

What’s love, really, got to do with it?

With respect to money, quite a bit, experts argue.

“There are so many ways to go with this topic,” Campbell says.

“Let’s talk about couples and money, and how we know that financial problems are one of the greatest sources of stress in a relationship.”

Certainly someone working at licensed insolvency trustee firm knows.

“When people come to see us they’re often either on the verge of divorce or going through one, so certainly money factors in the relationship.”

Love did, at least at one time, too.

But it’s broader than marriage, or romantic love.

Consider greed. What is that human condition but a misplaced love affair between and an individual and the loonie?

Then there are ‘loved ones.’ The connection between love and money ranges from everything from estate planning and life insurance to using cash as a way to show love.

Valentine’s Day is a timely example.

“It’s so easy to look at the latest trends on social media, but … will that gift be valued by the person you love,” says Flora Do, vice-president at RBC in Toronto.

Certainly money spent on chocolates and flowers brightens up the mid-winter.

But more expensive gifts made without consideration of the household budget can lead more long-term regret. A recent RBC poll alludes to as much.

It surveyed recent Christmas holiday spending, finding 35 per cent of us likely went over budget on gifts. Put another way, money may have been no object for loved ones—until the bank statement came.

“There’s definitely a financial component to love we have to grapple with, and the more we can understand that and put it in its pace, the more successful relationships are likely to be,” says Jackie Porter, certified financial planner with Carte Wealth Management Inc. in Mississauga.

Love touches on so many financial angles, from who pays for dinner on a date to how much you should spend on an engagement ring, she says.

With the ring thing, there’s that three-month salary rule of thumb—a marketing ploy cooked up amid the 1980s high inflation. Originally, one of the world’s largest diamond purveyors pitching one month’s gross salary for aspiring grooms to help guarantee a ‘YES!’ … during the Dirty 30s.

Then it became two months a few decades later. Today it’s still three months—though wedding website the Knot’s recent survey suggests the average spend is more than $7,000.

It also found many couples discuss the ring budget beforehand. Hopefully, those go beyond the bling, says financial therapist Brenda St. Louis.

More broadly, talking about money is “the last taboo,” says the Vancouver-based certified money coach. “People are more likely to talk about sex life at a dinner party than their finances.”

St. Louis employs “money archetypes” to help people understand their relationship with money, and those often rhyme with their personal relationships.

“I often use the question, ‘If money was your lover, how do you choose to treat it?’”

Some are “jealous lovers.”

They’re very controlling of their finances, and perhaps of their love relationships too, she says.

Others fit the “one-night stand” model. They spend money freely, and then feel awkward in the aftermath.

“There is never one rule to cover everyone.” But people often recognize pieces these archetypes in themselves or their partners.

Like other experts, St. Louis says money is a topic best discussed in the open than avoided. It sounds obvious, but most people dive into relationships without talking about it.

Or we raise our kids without talking about it — setting up a similar scenario for them in future relationships.

That said, “people are generally concerned about the impact of finances,” Porter says. “It’s just that there is no easy language to do it.”

Professional advice helps, she adds.

If you’re thinking about getting serious in a relationship, it’s not a bad move to discuss it with your financial advisor on the money-related aspects of issues like co-habitation.

Unequivocally, planning is important to managing personal finances well.

In turn, a little thought and planning about the trajectory of cupid’s arrow might just lead to long-term Valentine’s success too.

Source link