Ryan Reynolds recently revealed on Jimmy Kimmel Live Tuesday that he spent nearly $3 million on a Welsh football team without consulting his wife, Blake Lively. As expected, he was in deep trouble when his wife found out, as she did not take it lightly. 

Even though Ryan’s spending was on a different level from what most couples would spend, he broke one very important cardinal rule in every relationship: Always discuss major financial decisions with your partner before making them.

In a relationship, each partner will have different expenses that they splurge on. For example, one might fancy luxury handbags, and the other might love Lego collectables. Therefore, it’s crucial that both partners agree on expenses that don’t align with each other’s priorities. If the incongruent expenses are not addressed, it will ultimately hurt the relationship in the long run. 

A first step to kick start the conversation is to mutually define what is considered a big ticket item purchase for both of you. An RM5,000 spend could be significant for some but okay for others. Agreeing on a sum helps to set the expectations from the beginning. 

Next is to align the purchases with your financial goals as a couple. Is the discretionary spending necessary for now, can it be postponed to a future date? Could you get it during a sale period? For example, if collecting LEGO is your passion, have you set up a fund which enables you to afford the purchase instead of instantly splurging on a new set? 

Another common reason given when someone makes a high-ticket purchase is that the purchase is a good investment. You might want a Thermomix set because you think that price is justifiable as it’s a good quality product, but how often do you cook your own meal? 

The bottom line is to start having these conversations with your partner before the purchase. It will not only improve your relationship with your partner but also improve both of your financial goals. 

“My partner won’t talk about money with me.”

What do you do when one partner looks at money completely different from you or, worst still, doesn’t want to talk about money at all?

Once I had a client, Celine, who engaged me in financial consultancy. She was frustrated that her husband kept trading the market and losing money. Her husband, Chris, traded the Malaysian glove stock counters during the Covid-19 pandemic hype but didn’t sell for a profit in time. Now, he is staring at a loss of almost 70%! He is convinced the stock will fly up soon and has become a “long-term investor” rather than a trader. 

Celine got worried as Chris did not want to talk about the losses and the plan forward to mitigate their losses. 

Financially, the couple is doing fine. There are the typical middle-income family with two school-going kids. Celine and Chris are in a well-paying managerial role earning a good income. Their most significant investment thus far was an investment property. Still, Celine wants to speed-track their investment portfolio as she worries about establishing her children’s future education and retirement funds. 

The sour experience with the stock trade had made Chris quiet and not talk about finances. He had grown sceptical of stock investments and now prefers to keep money in FD instead. 

While engaging with a client where both partners make financial decisions, it is best to talk to both of them. Therefore, I invited Chris to join Celine in our next call. 

“I got burned bad trading, and now I am afraid of investments. I am also embarrassed and ashamed that I lost soo much of our money,” Chris said. 

Chris was silent about money with Celine as he felt his next money decision would also go wrong based on his bad experience in the stock market. He did not want to disappoint Celine again. 

That was the “Aha Moment” for both. When conversing about money with your partner, you must be transparent about how you feel. Once both understand their partner’s intentions and feelings better, it will be easier to move forward.

It turns out Chris is also equally worried about their kid’s education and retirement funds, which prompted him to trade the glove stocks in the first place. During the call, Chris and Celine understood that they have the same financial goals. This was a good sign. 

We then proceeded to lay out a plan to achieve their goals. By having a Financial Compass as a guide, both Celine and Chris are more clear on how to achieve their common financial goals. Chris also apologised to Celine for his financial mistakes. As such, both of them could move forward with a fresh start.

What are the other financial issues you face as a couple? Do share with me.