Carmen Wong Ulrich is President and Co-Founder of ALTA Wealth Management, an independent financial planning firm that advises clients on financial issues and growing wealth. She is nationally recognized for her frank advice on money matters and can be seen as a regular on ABC’s The View, MSNBC and CNN. She is also the author of two best-selling personal finance books, the most recent, The Real Cost of Living. Carmen is a former editor at MONEY magazine and was host and co-creator of CNBC’s On the Money.
Carmen has advised women for years on the importance of money in a relationship, calling it part of the trinity of topics—money, sex and family—that will exist forever as potential conflict zones in your relationship. Women need to take ownership of their financial health and be comfortable discussing it with their partners or spouses, she says.
“You should have financial goals together,” she said. “Integrate your money into your discussions. These are conversations you need to have before you get married.”
If you’re already married, this doesn’t mean you should run out and separate your money or accounts. Ulrich advises: “Ask: Is this right for me, for us? Am I comfortable with this and do I have a say in where the money goes and is spent? I’d advise every woman to have at least one credit card in her own name only. You don’t have to use it often, but have it just in case. And no matter how happy you are as a couple have a small checking or savings account on your own as well. Again, this is about autonomy and being grown ups. If you want your own separate money and your partner is very upset by this, seek counseling as it’s a sign of deeper concerns.”
ULRICH’S 7 TIPS ON MANAGING MONEY & RELATIONSHIPS
1. Keep A Separate Bank Account and One Household Account: It is okay to pool together money for household expenses and having one household account that you both contribute to. But you need money in your own name. Do you want to have to run every single expense by somebody for permission? Say you want to get a mani/pedi. Do you have to ask him first? No. You don’t want to infantilize the relationship.
2. But Don’t You Trust Me? If your spouse or partner says that, it is a red flag. This isn’t about trust. It is about being your own person. Just like you need to keep your own friends, hobbies and interests, you need to keep some of your own money. The worst situation is when two people blend into one person. Keep some money in your name so you feel like you own your life.
3. Don’t Be in the Dark: When women just hand over everything financial or are just kept in the dark, it is such a mistake. It is not in the spouse’s best interest to be in that situation. You need to be knowledgeable. You should know all the passwords for where the money is even if you don’t understand how it is managed.
4. Keep Your Own Credit: Your partner may not have great credit. You need to be responsible with your own credit. If my credit score is 800 and yours is 640 the one with good credit will keep the two of you afloat when and if you apply for a loan together. If one has great credit and one has lower, it will be averaged out. If you merge everything, keep in mind that people change, they keep secrets. Sometimes they lose it and if your partner looses it, you will be also responsible for what debts you’ve merged. You can have a household credit card where you are the primary cardholder and your spouse can be an authorized user, but keep limits low.
5. Money is Not About Money: We all know that money is such a source of stress. A lot of it boils down to control and baggage. We learned about money about the way our parents handled it. It is a very emotional issue and it is one of the best ways you can gauge if somebody is right for you. People’s attitudes with money are formed when they are very young and can be very difficult to change.
6. Pay Attention to How He Handles Money: The way they tip in a restaurant has a lot to do with their character and values. If they pay for dinner, is he using that as a way to control things? Is it about machismo or wanting to be chivalrous? Or is it genuine? If they say, ‘Oh, I forgot to pay this bill!’ That is an opening to ask ‘Oh, are you always late?’ If he is working in tech support but he is driving an Audi A8—a $120,000 car—what does that say? That is dangerous because that is somebody who is showy with their money and may not be able to handle life’s setbacks or planning or thinking of the future.
7. Flashy is Not Necessarily Good: Men are trying to be showy to attract a mate. I call it peacock syndrome. The fast car and clothes are their feathers. So you have to ask, ‘is this a short term fun thing or a lifestyle?’ If he is successful then his lifestyle should match. A guy who looks good and puts himself together well but never pays retail price is a guy who knows the value of money.