Couples And Money

If you and your partner argue about money, you are not alone. Fighting over money is one of the leading causes of divorce in America. That prompted financial adviser David Bach to write "Smart Couples Finish Rich." He shared some advice on The Saturday Early Show March 30 about how couples can get a fresh start on their finances.

Bach's goal is to educate every woman, man and child in America about how they can take charge of their financial futures and empower themselves and reach complete financial independence. His first book, "Smart Women Finish Rich," was published in 1999 and sold more than 300,000 copies.

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He says that in most relationships right now, both partners are working and still they are living paycheck to paycheck. "The Money Makeover" is what Bach calls his solution on how a couple can change, fix and create a new financial independence.

Here are some of the steps he covers in his book:

• UNDERSTAND WHY YOU FIGHT ABOUT MONEY. Most couples fight about money. The reason is we almost always marry our financial opposite. People who budget fall in love with people love to shop. Then money becomes a control issue and before you know it there's what we call a "money war". It's financial tit for tat: "You spent this. I can spend that."
• PLAN A MONEY DATE. The best way to start on your finances as a couple is to set aside time to talk about money. That means agreeing to a time to talk. Three things to talk about during your money date:
  
  • What's working financially in our life?
    
  • What's not working financially?
    
  • What is our No. 1 financial goal for the year?
  
  
• FIND YOUR FINANCIAL "STUFF". You need to find your financial documents. To get started, Bach's Financial Inventory and Cash Flow worksheets are great tools.

  Bach also has created a list of 12 financial folders to get together. He calls it the FinishRich File Folder System. The folders include: Tax Returns, Family Will or Trust, Social Security Benefits Statement, Retirement Accounts,· Investment Accounts, Credit Card Debt, Home Mortgage, Insurance, Social Security, Kids Accounts, and College Savings.

• OPEN A DREAM ACCOUNT. The fastest way to get excited about a money makeover is come up with something together that you want to do. Bach calls this "planning a yearly dream." It might be paying for a vacation to Hawaii. The key is to open a special investment account (like a money market account) and fund it monthly to pay for the dream. You want to do this by setting up a "systematic-automatic investment plan."