Measuring Results in Financial Planning for Couples

“What sort of results does financial planning for couples help clients achieve?”

It’s a common question that I get, and rightly so. Because broadly speaking, couples can expect two types of results when they work with me.

Some couples reach out to me because they’re hoping to achieve a specific financial outcome: getting out of debt, retiring comfortably, buying a first or second home, managing their tax bill, or anything in between.

Other couples reach out to me because they’re looking to reduce the friction or conflict that money causes in their marriage. They want to figure out the optimal way for them to manage money together, understand and implement a plan to handle their financial differences, resolve financial conflict, and so on.

On the financial side, the results are relatively straightforward to measure. I recently aggregated the results our clients have gotten since Pacesetter Planning was founded back in 2016 and found that we’ve helped clients get rid of $1,140,000 in debt, buy 27 first homes, handle millions of dollars of stock compensation, and much, much more.

(If you’d prefer to listen to this article, you can get a podcast version of this post here: Money and Marriage Podcast Episode 136 – Measuring Results in Financial Planning For Couples)

More broadly on the financial side: are your savings rate and net worth increasing at a rate that is sufficient to achieve your goals? At its core, this is the primary financial result I measure for clients. As long as this is the case, the goals will seemingly handle themselves.

But, financial planning for couples isn’t always this straightforward.

Financial Planning For Couples Requires You To Go Beyond The Numbers

If you and your spouse are completely in sync financially, then “just” focusing on the bottom-line numbers is typically sufficient to measure the results of a financial plan.

But if you’re not on the same page, it can be misleading or even counterproductive for a financial planner to only focus on the numbers.

If one spouse has clearly defined goals, an aggressive savings plan, and a growing net worth, it can be tempting for the financial planner (or the spouse) to use these numbers as the standard by which results should be measured.

But if the other spouse is disinterested about the family’s finances and tends to spend all of the money that he or she earns, or if the spouse has much different financial priorities or attitudes about saving, things change. I would argue that before we start focusing on financial results, we first need to craft a plan to get both spouses on board.

Consider the following hypothetical scenario: Sally and Sam are married. They make a good income, and they both want to buy a house in a high cost of living area in the next few years. Sally is an aggressive saver; before she got married, she was saving over 20% of her take home pay, in addition to maxing out her 401(k). Sam, on the other hand, is completely disengaged with his finances, and has a long history of gambling any extra cash he has on hand.

Sally might be tempted to draft a financial plan for her family to maximize their savings rate so they can achieve their dream of buying a home, and monitor the results by tracking their savings rate and down payment fund.

But Sally is unlikely to be able to outearn and out-save Sam’s gambling problems on her own. There are a few results that their financial plan needs to achieve first:

  • First and foremost, the conversation about their financial plan needs to help inspire Sam to get his gambling under control. Unless Sam wants to change, external pressure to stop gambling could make the problem worse.
  • Once/assuming that Sam recognizes the impact his gambling is having on the family’s finances and how it threatens their (shared) house purchase goal, he should seek counseling to help address what’s driving this behavior. This means that Sally and Sam’s savings rate might decrease in the short term if they add the cost of a therapist to their monthly budget. On paper, this might look like they’re going backwards financially, but in reality, the therapy is an investment in their future.
  • Finally, a financial plan for Sally and Sam needs to be structured and implemented in a way that will work for both Sally and Sam. This probably will involve Sally doing most of the month-to-month financial tasks for their family, since she’s the more “hands on” financial spouse. But, it will be critically important that they implement the right processes to manage money together going forward so that Sam is fully in the loop about the state of their finances and is given a vote in big financial decisions for their family.

Sally and Sam’s situation is relatively extreme because there is an addictive behavior (gambling) that is causing some of the financial disunity in their family. But whatever the reasons that you aren’t on the same financial page, it’s important to focus the outcomes of your plan first and foremost on improving the financial alignment between you and your spouse.

Need some help having these conversations? Click the button below to schedule a free breakthrough session with me whenever you’re ready.

A Three-Part Framework For Defining Results For Couples In Financial Planning

If you’ve made it this far in the article, you’re probably thinking, “Ok, Bill, that makes sense. But ‘getting on the same financial page’ is a pretty broad statement. What specifically should we be focusing on beyond the numbers?”

I’ll answer that question with three words: Why, What, and How.

The primary objectives I measure in the first three to six months of working with a couple are how complete an answer the couple has to the three questions listed below. The first two can be answered in whatever order you’d prefer, but it’s important to save the “How” question for the end. (I typically customize the sequence in which we address these questions based on the specific dynamics of the couple I’m working with).

Each of these three questions is important, and both you and your spouse should have a clear answer to all of them.

1. Why are we working on our finances?

It’s very common for one member of a couple to have a crystal-clear reason that they’re looking to work with someone like me, and for the other spouse to only show up to the first meeting because their spouse told them they needed to come (if they show up at all).

In order for your family’s financial plan to work for you as a couple down the road, the first thing that needs to happen is that we need to clearly identify reasons that both of you are engaging in the process.

The reasons can be financial in nature (“I want to achieve _______________”) or be related to the marriage (“I want to stop fighting about money.”) Your spouse’s reason for participating in the process will probably be different than yours – that’s completely normal, as long as your spouse’s reason for participating in the financial planning for couples process doesn’t completely contradict yours.

But you both need to have clear reasons for why you’re committed to the process. Until you get clear on this, your plan isn’t likely to stick in the long run.

2. What do we want things to look like in the future, and what do our finances look like today?

I’ve talked on my podcast before about how important it is to spend most of your time looking at the road ahead when you’re driving a car, but taking some time to periodically check the metrics on the dashboard as you go.

And I’ve also talked at length about the importance of creating family mission statements to guide your future financial decision-making.

That’s exactly what we are talking about here.

Typically, couples want (mostly) the same things from their long-term futures together; it’s part of what made them good fits for each other in the first place!

The more you can anchor your family’s financial plan to these shared future visions and goals, the better things tend to go.

This starts, of course, with taking the time to lay out a family mission or vision statement, and then setting specific financial goals that will help you achieve this vision. Being able to clearly define these things is a huge win for a couple that typically happens in the first three to six months of working with someone like me.

This is also the right time to clearly lay out where you are as a couple today when it comes to your finances. The name of the game here is transparency. Even if you don’t decide to combine all (or even some) of your financial accounts, it’s critically important to have full transparency with each other about your current financial state.

Don’t take this transparency for granted. Getting to the point where a couple feels comfortable laying all the chips on the table is a huge win, and it’s one that’s really, really important for the long-term viability of your financial plan.

These conversations aren’t always easy, and it can be tempting to avoid them, but the long-term effects of not being willing to be transparent with your spouse about the state of your finances cannot be overstated.

If you want help having these conversations, you can book a free consultation call here.

3. How Do We Manage Our Money Going Forward?

The final step is implementing a game plan for how you will manage your money going forward that is in line with the reasons why you’re engaging in the financial planning process for couples and what your vision, goals, and current financial reality look like.

Unlike the first two questions, the “how” of the plan can take 3-6 months to get “right” for you and your spouse. It takes some time for new financial habits to stick, and that’s ok. As long as you both are committed to your why and what, the how will come into line.

There are a few key components to how I recommend couples manage money together, many of which I’ve discussed on the Money and Marriage Podcast in the past.

  • Account structure – This includes deciding whether you’re going to combine all or some of your accounts, but it also includes implementing strategies to handle large, irregular expenses like gifts and travel, and it includes identifying where you will be directing your money on a monthly basis. Are you putting the money you save in a savings account, an investment account, or paying down your debt? Laying out the blueprint for your family’s financial architecture in a way that’s consistent with your why and your what will make things much easier for you down the road.
  • Monthly money meeting – The best financial planning results come from couples who regularly review their progress. But, it’s important to structure these review conversations in a way that decreases the chances of money fights, and to have them frequently enough to be able to make adjustments in real-time, but not so frequently that it becomes burdensome. In my book, I detail a monthly money meeting process that takes about 20 minutes per month to complete and only focuses on the most important drivers of your family’s financial success.
  • Use an account aggregator – The couples that make the most progress are the ones who are fully committed to financial transparency. There are many different technology platforms you can use to aggregate all of your financial data in one place. I use RightCapital, a software built for financial planners, to serve this purpose with my clients, but there are many others available to consumers. Utilizing a service like this not only allows for full transparency in the financial planning process between spouses, but it’s also convenient, as it allows for your plan to be up to date in real-time!
  • Be willing to iterate – I’ve worked with over eighty couples in the past seven years, and I can say with confidence that nobody has ever implemented the perfect financial management plan in their first attempt. There are always changes that will need to be made over time, whether that’s because your initial estimates were off, or because your financial picture is constantly changing (or both!). It often takes three to six months to get your plan completely ironed out. As long as you both are making a full faith effort to stick with your plan, give yourselves some grace and allow yourselves to make adjustments as needed.

The Five Principles

The result of addressing each of the questions above in the financial planning for couples process is that you will build a solid financial foundation for your family. Typically, it takes about three months to get this foundation in place, with another three to six months to refine and optimize the plan.

In chapter two of my book, Marriage-Centered Money, I talk about the five principles I use to evaluate a couples’ financial planning progress beyond the financial numbers:

  • Confidence – reducing financial anxiety and guilt and increasing your belief that you’re on the right financial track as a family
  • Coordination – how effectively you and your spouse manage money together
  • Communication – how well you and your spouse talk about money with each other. (At first glance, coordination and communication sound like they’re the same thing, but there are big differences between the two!)
  • Clarity – having a system in place where each member of the spouse knows where their family stands financially
  • Commitment – how well you and your spouse follow through on your best financial intentions.

At the end of the day, the financial results a couple gets from a financial plan are really important. But before we get to the financial results, improving your financial confidence, coordination, communication, clarity, and commitment are huge wins that will dramatically improve the impact that money has in your marriage. If “all” your financial plan does is improve these things in a few months or so, that’s a huge win.

If you want more information about my process for financial planning for couples, I encourage you to check out my book or schedule a free breakthrough session with me.

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