Having the ‘Financial Chat’ with your significant other…

Jun 24, 2021 | General Financial Planning News

Michelle McKay, Trust Officer, advises on what couples need to consider regarding their financial arrangements.

For some couples this is not an easy subject to address. However, the Covid epidemic has certainly highlighted the importance of sharing your personal relationship with money i.e. debt, savings, fears of not having enough money and short- and long-term goals.

Working at managing your finances effectively together is vital to building and maintaining a strong and healthy relationship and can bring couples closer.

There are several easy steps you can take to introduce the conversation with minimum conflict.

Talk to a financial planner

Consulting an expert who is not emotionally invested in, or influenced by, your money situation – but who understands how much emotional charge it can carry – diffuses tension and makes it easier for you to hear each other out. Your financial planner will be able to advise and assist you to create your own bespoke investment plan which will be the foundation for all your future investment decisions. It is important to revise this at least on an annual basis.

Discretionary spend

Agree on a “maximum spend” amount that must be discussed with the other partner before a purchase is made e.g. a maximum discretionary spend of R1,000. Any purchases over this amount must be agreed on by both partners. It might be annoying but will avoid conflict when you bring home that expensive set of golf clubs or pair of designer shoes.

Walk the same path

Discuss and align your financial goals and decide what you want to achieve in the short-, medium- and long-term. Allow yourself to dream and plan for your future pre- and post-retirement. This will make saving and financial planning more fun and ensure that you are able to celebrate some milestones along the way.

Bank accounts and budgets

Decide if you are going to have a joint account for expenses but also keep separate bank accounts in your own names as well. An option would be to split expenses based on your respective earning capacities. You might choose to have one partner handle “big finances” such as the bond instalment or rent and investments while the other handles “small finances” such as the weekly groceries and running the household.

Whatever you decide, make sure that you are both happy with the split and revise this from time to time to ensure that  there is no simmering resentment on either side.


Discuss your investment strategy as a team. An overall view of your collective investments and understanding what you are each invested in will help you identify any areas where you may not be as well-diversified as you thought.

For example, you and your partner may both have extensive exposure to property within your portfolios, thus making your overall portfolio overly property-weighted. It is also useful to understand what savings vehicles you are each invested in, whether this is a pension fund, retirement annuity, tax-free savings account or other. This will help you to determine whether you may be overweight in retirement savings vehicles and do not have enough discretionary savings to buffer you both against unexpected events such as retrenchment.

As mentioned earlier, it is very important to revise all your financial affairs regularly or whenever there has been a life-changing event. This will put your minds at ease that your savings plan is still on track; if not it will be an opportunity to discuss any changes with your financial advisor.

Estate planning and other dependence

Revise your Wills regularly and consider the option of a Living Will.

Estate planning can be a tricky subject and becomes even more so when you are in a second marriage or relationship. It is vital that your spouse is aware if you are leaving some assets to children from a previous marriage. This is important from both a risk planning and an estate planning perspective. If you have young children from a previous marriage or relationship, remember that you have a maintenance obligation that should be provided for in your estate planning to avoid any claims on your estate. Your partner should be aware of your life policies and retirement funds – and know who the nominated beneficiaries are.

Not having a financial goal is like taking a holiday without knowing where you are going.