Houston, we have a serious problem…
I started off pretty bad with money. I didn’t have a budget, didn’t think much about saving, bought expensive things on impulse, and ended up spending more than I earned each month.
My wife was better in that she didn’t buy expensive things, but she didn’t really think about saving either.
I started to change after reading Your Money or Your Life. That book made a big impression and really changed my thinking about money.
My relationship with money gradually improved.
As I read more about personal finance, I started thinking of saving not in terms of saving, but rather in terms of buying passive income. This changed saving and investing from something I had to force myself to do into something I wanted to do.
My wife was happy enough to go along with the saving at first, but then we started having small arguments. Our main areas of friction were:
1. I wanted to save and invest more than she thought necessary. I was aiming for financial independence, my wife didn’t really understand the concept.
2. I didn’t want to buy a house and land in Japan. My wife wanted a garden she could grow plants and vegetables in.
3. I was interested in investing. I wanted to put our savings into a balanced portfolio of global index funds. My wife didn’t understand the products.
We solved the problem by… wait for it… talking about it. I explained what I was trying to do and asked what my wife wanted from life. Together we agreed to save a bit more than she wanted to and a bit less than I wanted to. We talked about what we would do when we have a bit more time and money to spend on ourselves.
We compromised on the house and land by buying a cheap manshon as a base, and agreeing to look for a cheap house with land in the country, so we can get the garden without committing a large amount of money to it. We’ll be able to enjoy it at weekends rather than every day, but it will cost us a fraction of the cost of a house in the city (a couple of million versus 40 million+).
I manage my wife’s investments and sit down with her every few months to explain what is happening with her portfolio. She is still not interested in investing herself, but understands what I am doing with her money.
I think we were were lucky (or we chose the right person to marry). None of these are big problems. Broadly speaking, we have similar attitudes to money. We both prefer spending money on people and experiences over buying things. Travel and food, not new cars and fancy shoes. This has made it easier to bridge our differences.
No matter how far apart you are in money matters, talking about what you want and, more importantly, why you want it, should go some way to bringing you closer together.
How about you? Are you on the same page as your partner? Have you overcome any financial differences? Are you having any big problems at the moment?
Great post!
As I am sure the case with many on this website, my spouse is Japanese and I am a westerner. She loves Yen in the bank and I love diversification. She is a saver and I tend to be a bit of a spendthrift. How did we work it out? By creating a strategy that allows us both to do things the way we want. Basically, she is in charge of our budgeting and cash savings whereas I am in charge of the investment portfolio. Her cash discipline prevents me from wasting money and my overseas investments ensure that we do not keep too much of our money idling in cash. The added bonus is that the investments I control are locked in investment accounts and thus I can’t go crazy and start spending our retirement money… not easily at least!
Also, and it hurts me to say it, with the recent rise of the yen and poorer equity performance, her cash only portfolio is killing mine!
I think the key takeaway that you identified in your post is communication. We have an ongoing spreadsheet that we update every month into which we disclose ALL of the assets we separately manage. Having this transparency is key to trust and allows us once a month to sit down and have a discussion about our finances.
Westerner with Japanese wife here too. I think our biggest disconnect is that she is having a hard time understanding how *me* retiring early is going to help *her* or our family in any way. From her perspective, this will bring even more stress and constraints on our budget, versus the security we would have if only I accepted to work my whole life just like everybody else.
(Conversely, the disconnect on my side is that she quit working 5 years ago – to take care of the kids – and I’m frustrated that she doesn’t understand why I would want my share of this as well)
She’s progressively accepted that having me RE would mean significant less work on chores and with the kids for her, but I won’t lie: I’m not retiring just so that I can work just as hard at home, I’m a lazy guy and want a significant amount of “me” and “us” time in RE.
I think for a while she’s only understood the “lazy” part of this plan, and because of that it felt to her as if I was asking sacrifices from the whole family just for my personal benefit. I hope she sees otherwise by the time we reach FI.
Agreed, communication is key, I just badly suck at it.
A big thing for me with FIRE is not just freedom but also security. Security that I could lose my job and be okay, or security that we could move to another city in Japan or another country and be okay.
I have lost a job at short notice in Japan and been through the 2011 earthquake, so both of these resonate with my wife as well…
Probably much younger than many of the community here, and thus shall listen to the advice of those who have been down the same path.
If the works of Thomas J. Stanley is any indication though, without a spouse who is fully onboard for the ride, the notion of long term investing loses a lot of meaning and conviction.
Unfortunately, my tale is a sad one, but potentially not without a possibly brighter future.
My (Japanese) wife and I had all the differences related to finances you could have. I had school loans that needed to be paid back, while her education was paid for by parents, in cash. I wanted to travel back to the US every two years (or more often if ever possible) to see family and friends, and to travel. She didn’t. I like(d) little splurges on experiences and food/drink over large/expensive purchases, while she preferred buying things. When I became interested in learning about investing, she was against the idea and wouldn’t support or assist in learning more about investing in Japan. My spoken Japanese is actually quite good, but my reading level is very elementary and I wasn’t able to make any progress getting started in investing. The list goes on and eventually we were unable to reconcile our differences and ended up getting divorced- in large part because of those differences, but also because we weren’t able to talk them out and come to agreements or compromises. I deeply regret my spendthrifty habits, because, as my grandfather would call it, I was nickel and diming our paychecks.
I mentioned there might be a potential happy ending. If I can get a handle on my finances, I might be able to get back my family. There seems a genuine possibility. In the meantime, I’m on my own now and look to cut corners and save wherever possible, especially in ways that really don’t matter to me- primarily through lowering utility bills, but also by cooking more for nutrition and budget than for satisfying a mood or craving. I’m chipping away at bad habits and making newer, better ones, nagging myself as necessary. I still haven’t gotten good at not spending money, but I am definitely improving. I am also still not investing, though, which is something I hope to change soon.
I wish everyone the best of luck. If I had understood that I could lose my wife and daughter to Starbucks and craft beer, I definitely would have made some more sacrifices.
Hi Andrew
I’m really sorry to hear that and hope things work out well for you. Generally speaking, things tend to go in the following order:
1. notice there is a problem
2. figure out where money is going
3. work on reducing inefficient spending (spending that doesn’t bring joy)
4. work on earning more
5. pay off any debts over 1-2% interest rates
6. build up an emergency fund (2-12 months expenses)
7. start investing
Let us know if you have any questions or if there is anything we can do to help.
Thank you for your kindness!
I’m working on breaking bad spending habits, which is hit and miss. It’s so hard to break some bad habits. Thankfully, I’ve found extra work and I’m making more money now, doing something I enjoy, and that is helping a lot. I don’t have any debts, which is great. The struggle now is to save, to build that cushion, the emergency fund. Anyway, you mentioned a book that you said changed your life, “Your Money Or Your Life”, so I decided to get a copy. Hopefully I’ll develop a change in thinking, too, Anyway, I always enjoy your blog posts, so keep them coming- They make a difference! 🙂
Your Money or Your Life is deeply philosophical and can be life-changing. Hope you enjoy it!
No debt is a great place to start.
The thing that made the biggest difference to me was to start thinking about saving and investing as buying freedom for myself. I can’t wait to go ‘shopping’ every month now 😉
Hello Andrew! Welcome to the community and my deepest condolences on what must have been a very traumatic experience.
The good thing about have the self-realization of bad spending habits will with time prove to be a very powerful factor in bettering oneself.
The hardest step is always the first so don’t fret, and just keep working on it!