If you want to do your spouse a favor, you should pretend you donâ€™t exist… At least for a few hours.
If youâ€™re the one who manages the finances – and possibly earns most of the money – youâ€™ll do your spouse a solid by simply going through this exercise.
Ask your spouse how they’d pay the bills if you were gone.
How would they pay the mortgage?
Where would the money come from?
How would they save for retirement?
Pay for the kidsâ€™ education?
I recently asked a group of men in their 70s and 80s to think about how their spouses would carry on in their absence. They didnâ€™t even understand my question. They looked at me as if I were from Mars.
They never took the time to think about what might happen to their spouses once they die. Rather selfish… Donâ€™t you agree?
What? Theyâ€™re going to live forever?
You might love to run this “fire drill” at home but your spouse doesnâ€™t want to take the time to do it. I feel your pain but want to encourage you not to acquiesce.
Ask your spouse to think about getting on an airplane. Isn’t it better knowing there is a trained co-pilot even if he or she never gets the stick? Of course it is.
Doesnâ€™t your family deserve a co-pilot too?
Youâ€™ve worked hard to create a solid financial base, but it’s going to turn into “poo” if your spouse doesn’t have the skill to take control. How does that make you feel? How does it make your spouse feel?
I take this stuff really personally. I know what itâ€™s like to try to pick up the pieces after the people who were supposed to be financially responsible werenâ€™t. Itâ€™s not pretty. Itâ€™s not fun. Donâ€™t let this happen to you.
So… What are the three most important steps in getting your spouse ready to take control?
1. Maintaining a budget
You simply have got to get your partner conversant in the language of “budget-speak.” Put them in charge of tracking your budget. This way, theyâ€™ll get a sense of where the money is coming from and where itâ€™s going.
It doesnâ€™t matter if you use an envelope system or a software package to track your expenses. Just implement a system and make sure your spouse takes charge of it.
Iâ€™ve done this at home even though Iâ€™m the CFP with 25 years experience and a degree in accounting. My wife keeps the books. She is in charge of the budget tracking, and we spend an hour every week going over the numbers to make sure weâ€™re on track.
Itâ€™s been a game changer for me as I know it will be for you.
How do you introduce this system?
At first, spend that time learning together. Donâ€™t get angry if your spouse is resistant or finds it difficult. Be patient. Give them time. But stick to it and donâ€™t allow them to give up.
Get a commitment from your spouse that he/she will update the books each week at a set time. If they need your help, make yourself available during that time.
In addition, meet every month at a pre-arranged time. Go over whatâ€™s working and what needs to be addressed. Are you on budget? Are you saving as much as you planned? How are the investments performing?
2. Life insurance
If you have people who depend on you, buying life insurance is a must. Term is my insurance of choice because itâ€™s cheap, and it gets the job done. Talk about this with your spouse. Tell your spouse how much insurance you have, why you have it, and what should be done with it in case you get taken out.
3. Books and records
Create instructions on how things should be handled in case you die prematurely. The instructions should cover:
- What to do about living trusts and wills
- Who should be contacted
- How to generate income
- Where the investments are and how to manage them
- Where the insurance policies are and how to cash them in
In my experience, these are the three crucial steps to take to get your partner involved with your finances.
I understand that it may not be easy for you to ask your spouse to take these steps with you. I understand that even bringing up the subject could be very uncomfortable. But I also know (first hand) that failure to do so exposes your spouse and your entire family to tremendous risk.
Take these three steps. Start with step one. Start today.