Forget "he said," and "she said." For many couples, it's more like "he spent," or "she spent." You "need" a weekly manicure, a daily Starbucks venti peppermint white chocolate mocha, and a new purse ("but Coach lasts forever!"). Your tightwad husband won't replace your sofa or his shoes until they're holey. Hmmm. What to do?
Talk it out. Husbands and wives need to understand each other's spending habits, even if they don't agree with them. If your parents always worried about running out of money, you grew up scared—and may become more of a skinflint. By contrast, if your parents spent freely and bought you anything you wanted, you may carry this approach into adulthood, says psychologist Joel Block, Ph.D, author of Broken Promises, Mended Hearts.
Figure out the "why." Personality plays a big role. "The narcissist, for example, is constantly buying to fill an inner emptiness. It never works," says Block. "And the insecure, fearful person may fear spending—not because he will end up broke, but because he has channeled many of his fears into money issues. His account balance gives him some degree of (temporary) security."
Discuss the pros and cons to each approach. "For the spender, enjoying everything today could lead to a bleak tomorrow. For the saver, not enjoying anything today does not ensure future enjoyment, given possible medical and aging issues," says certified financial planner Wilson Moy, senior vice president and manager of wealth advisory services for BOK Financial in Tulsa, Okla. "In the end, the spender should learn to save for big-ticket items and realize that spending everything today leaves nothing for tomorrow, while the saver needs to learn to enjoy some of it now and still feel financially secure for the future."
Build an emergency fund. Stash away enough cash to cover at least six months of living expenses, says Moy. After all, the Bureau of Labor Statistics says the unemployment rate is 9.5 percent.
Analyze your long-term finances. To put your situation into perspective, look at your current budget, your savings and your expenses (required vs. discretionary). It's a good way for a couple to "see the numbers in plain black and white—and red!" says Moy. "The analysis would illustrate the impact of always spending vs. always saving—and can be used to determine a happy medium with a balance of spending and savings to provide for a secure, long-term retirement lifestyle." You can get professional help from certified financial planners, and you can visit sites for the Financial Planning Association and the AARP.
Get help—quickly. If out-of-control spending by one of you has gotten the family in trouble, you may need to contact your creditors and deal with debt collectors. Choose a credit counselor wisely. For more information, visit the Federal Trade Commission site.
Do it for the kids. Be a good role model. If you're the spender, remember that your actions speak louder than words. A University of Minnesota study found a quarter of students at one college reported credit-card debt of more than $1,000. Yikes.
For more stories about your family and money, read:
Should You Let Your Teen Work?
When to Stop Giving Kids Money