hidden money habits will cause relationship friction

Written by The ReReport

PURCHASES of little luxuries such as clothes, handbags, meals and entertainment are being hidden from partners as couples avoid discussing their debt and spending.New research by Suncorp has found that almost one third of Australians in relationships keep luxury purchases secret from their partners.It has prompted a warning for people to be more open with their partners to prevent small financial problems spiralling out of control.Suncorp behavioural economist Phil Slade said people often spent money on luxury items so they felt more in control of their lives.MORE: Why young Aussies are going bankrupt“But after some time when their rational brain kicks back in they tend to feel guilty, and therefore hide the purchase — or at least the price of the purchase — from their partner, especially if they have gone into debt to purchase it,” he said.media_cameraSuncorp behavioural economist Phil Slade says spending is an emotional topic. Picture: AAP/John Gass“Debt and spending are highly emotional topics of conversation, and individual expectations on what is a good or bad use of money can differ greatly.“In Australia, we tend to think ‘I work hard, I deserve this — my money is my problem’, when in fact we know that finances are a topic that can impact both couples and families.”Suncorp’s research also found that 32 per cent of people don’t discuss debt with their partner, and 34 per cent don’t discuss their salary.MyBudget founder and director Tammy Barton said when couples fought about purchases, it was often less about the item and more about the fact they were not on the same page.“It’s friction caused by a clash of financial priorities and it’s a good indication that it’s time to sit down and look at what those priorities are,” she said.“Joint finances are always going to be problematic if you don’t have joint priorities.“That’s why budgeting is so useful. After you’ve paid your bills and set aside money for living expenses and savings, your budget shows exactly how much is left in the slush fund for things like clothes and hobbies and entertainment.”Ms Barton said people still found it difficult to talk about money with their partners, despite it being an essential part of life.“The effect is that a lot of people suffer financial stress in silence. It also means that a lot of couples are living their lives together but without any financial blueprint in place,” she said.“There are lots of advantages to joint finances, but it’s also important that each partner has some degree of financial autonomy. Sometimes it’s as simple as being able to buy your partner a present without them knowing.”@keanemoneyWE NEED TO TALK• Understand what motivates each other’s spending and savings behaviour.• Work out how you want to approach your finances.• Discuss broad life goals, and write them down.• Change your banking password to reflect a shared money goal, such as ParisInSpring2019.• Sit down and create a budget together.• Use cash instead of credit cards to avoid buying stuff you can’t afford.• Ask for help. There are free financial counselling and budgeting consultation services available.Source: Suncorp, MyBudgetOriginally published as The secret life of luxury purchases

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