Money Saving Mom®

Guest post from Leah of Simple. Home. Blessings

You have probably all heard the statistics reporting that approximately 50% of all marriages end in divorce — and that the most common factor/reason stated for ending a marriage is finances.

Indeed, the way a couple deals with money is often a very good indication of the way they deal with one another in a myriad of ways. The communication that exists (or doesn’t exist) regarding money lends itself to general conversations about goals, dreams, needs, and wants important to the health and viability of marriage.

So, it goes without saying that having open and honest dealings with finances is extremely important in any marriage.

The best bit of advice I would give to a newly married/engaged couple is to commit to a spending cap — or a specific amount of money you can spend without asking one another. It doesn’t matter what the dollar amount is, the promise you make to one another is what matters.

Once you determine together that you will not spend over that set amount without a conversation and an “okay” from the other person, you will probably find that your communication about other things really opens up, too.

Here are 5 benefits of a spending cap rule:

1. You create trust.

The most basic thing a marriage needs is trust — and trust regarding money is no different than regarding fidelity.

Knowing your partner has committed, and will stay committed, to what you have entrusted him/her with is the starting point of a healthy marriage, whether it be money or your heart.

If you pledged not only your hearts to one another, but also “all your wordly goods,” you have laid a lot on the line. Setting a spending cap on your purchases when you are away from your mate, helps build trust in a small way that will pay dividends later.

2. You create a firm financial foundation.

When you are assured your partner is spending within the limits of your agreed spending cap, you know you are staying within the limits of your budget.

The money fights that tend to break marriages up are usually not related to having too much money, but having too little money. Spending over the limit and splurges are budget busters that can lead to marriage problems.

This is not to suggest you can’t splurge every once in a while, rather that you communicate your desires to spend over the spending cap to insure both of you are on board with each purchase. You are both in the same boat, building your financial future together.

3. You create communication.

Talking about each purchase over the spending cap leads to more conversations about all manner of things. It opens up opportunities to work through conflicts in your marriage in a positive way. When the item you want to purchase is over the cap, a conversation is necessary.

Sometimes you may not agree with your spouse about spending over the cap. This can lead to a good back and forth discussion of the merits or disadvantages of a purchase, while still having a safety net of assurance that your spouse is not going to just go out and purchase an item without thinking of you and the commitment you made (this can lead to another rule we have around here, “If it is a no for one of us, it is a no for both of us.”).

4. You discover needs, wants, desires, and goals.

Discussing even the smallest purchase reveals to our spouses what we value and what we dream of owning. It also helps us discover what we don’t find valuable or what we don’t understand about one another.

You may see value in purchasing a particular item your spouse would never buy. That doesn’t mean you should never have it, but it does create an opportunity for them to see it through your eyes and for you to see it through theirs.

These conversations are also great for getting to know what your spouse would really like to have (something handy for birthdays and holidays).

5. You develop a teamwork relationship in regards to money.

This is almost an automatic by-product of positive communication about money with your spouse. Setting a limit or a cap on spending creates a “you have my back, I have yours,” kind of understanding. You know you would not want your spouse to violate your agreement, so you honor it as well.

Because of the trust and communication you create through your spending pact, you take all the questions and problems about money to one another to solve together. This is not a give and take kind of relationship, where you are on opposite sides of the table, negotiating a kind of peace. Rather it is a couple sitting down together to face the problems they have head on.

As I stated before, the limit of your spending cap does not matter as long as it fits with your budget and your marriage. Each couple will have a different limit, for different reasons.

We came up with our spending cap in the early days of our marriage and it has never changed. Our spending cap is $20. We find we discuss almost all of our purchases, even the ones that fit under our spending cap.

How is the health of your marriage when it comes to finances?

If it is on shaky ground, you might consider sitting down with your spouse and discussing or creating a spending cap. Even if your finances and your marriage is good, you still might think about discussing a spending cap with your partner to insure bumps in the road don’t throw you off course.

Leah is a wife to her wonderful husband and mother to 2 girls under 2. She loves homemaking and tries to find the joy in the everyday. She writes about it over at Simple. Home. Blessings.

Guest post from Kemi of Homemaking Organized

About 10 years ago when we happily discovered we were pregnant, we knew we needed to make some drastic lifestyle changes to welcome the coming baby. Before we were even married we had planned that I would be staying home to care for and homeschool our future children. That meant we would have to adjust from living on two incomes to one, my husband’s.

At the time we were living okay on two incomes. We only had one car, we lived in a two bedroom/two bath home, we took vacations about once a year, we ate out regularly but I cooked a lot at home, we tithed, we shopped, and we saved a little.

We both made good money but at the end of each month we didn’t have much left. We didn’t know quite how we were going to do it. It didn’t seem we had much to budge. Or so we thought.

We had about eight months to figure it out before our little one made an appearance so we got busy. Here’s how we did it.

The Decision:

The first thing we did was look at where all of our money was going. We pulled out our accounts and listed where the money went each paycheck.

Not necessarily in this order this is where we were spending the bulk of our money each month.

1. Tithing
2. Home and Utilities
3. Food and eating out
4. Tools
5. My shopping

We knew that our home, utilities and our tithing were not going to change. So those things stayed put.

Next, we realized we ate out about once a week and my husband would also purchase lunch and snacks during the day. That added up to a few hundred each pay period. I have a food allergy so I was bringing my own foods to work. We knew these eating patterns had to change.

Also in my husband’s job, he has to have certain tools. He is not reimbursed for them but we do itemize them on our taxes. The problem was he was a little “tool happy”. He was buying a lot of tools and they were adding up. So this was something to look into.

One we decided these things, we had to address my own shopping. I was not a huge clothing shopper but still I had to pay attention to the other things I might spend a lot on. Household appliances, perfumes, soap, and so on… these small purchases can add up quickly!

We gave ourselves small budgets in these areas and eliminated eating out altogether because it wasn’t necessary and with my food allergy it wasn’t that much fun for me anyway.

The Results:

We started to live off of one income as soon as possible. The extra would be put into savings.

We started off making a budget for the one income.

We made plans to pay off the car. We had less than a year on the payments and figured we could funnel the extra money we saved from restaurant eating and tool buying into paying off the car faster.

Where we Are Today:

It’s 10 years later. I’m at home homeschooling our daughter. We continue to tithe and we have the same car — it’s now paid off.

We eat out maybe four times a year for special occasions. My husband buys the occasional tool as needed.

We have a savings account. We still take vacations but they are closer to home (the beach).

My husband has received cost of living raises throughout the years but nothing drastic. I still shop but only where needed. I make a little working online but nothing to replace my previous income. Not even close.

Was it painless? For the most part, yes. We were blessed.

I had friends looking to make similar changes ask me how we did it. One of the things that most were not willing to give up was two cars. I can understand this. We were actually blessed here because my husband has a work truck so I have the car. Looking back, if we had to do it again without the truck, saving to buy another new to us car would be a good option.

What if you had to cut your income in half? Could you do it? What changes can you make in your budget to cut back on excess and build a decent savings account?

Kemi Quinn is a wife, mother, church musician, and amateur cook from Vancouver, Washington. She loves to read about how women kept home in time’s past (aka Vintage Homemaking). She writes over at Homemaking Organized about how to keep organized at home today.