One thing the financial crisis has shown us – now more than ever before – is that power is closely tied to money. Bernard Madoff is a... continue reading
One thing the financial crisis has shown us – now more than ever before – is that power is closely tied to money. Bernard Madoff is a good example. He saw a weakness in the system and took advantage of people and companies – to the tune of around $50 billion. Madoff’s downfall – and others like him – help show that now – more than ever – it’s important to be financially accountable.
Being Open And Honest About Finances With Your Partner
You may not have access to other people’s money, you may not be able to play the stock market against the odds. In fact, you may be on the other side of the fence along with most Americans: cutting back and trying to avoid a financial catastrophe of a different kind. But in both of these situations, being honest with your partner about your finances is crucial.
I suggest using the techniques I put forth in my book, Financial Infidelity, to figure out what factors influence how you think about – and talk about – money. I call this your MoneyGram – it’s your “financial makeup” if you will. Delving into your familial financial history can be enlightening to both yourself and your partner and can help you discover money behaviors and relationship dynamics within your family. This analysis will allow you to predict, prevent, overcome and solve money behaviors you face now – and in the future, including a dislike for discussing money.
How You View Your Money
As I mention in my book, Financial Infidelity, the dynamic of viewing money as a game of power in a relationship can have a significant impact on a couple’s shared finances. When faced with a crisis, risk takers, who generally take a “don’t worry, don’t plan” approach to money management, may make rash decisions that result in emotional and financial catastrophes for them and/or their partners. This can be especially problematic in this economic climate, where markets, accounts and careers are already primed for financial catastrophes anyway! It is crucial during these times of extreme crisis and/or risk that decisions be well though through, discussed openly, and ANYTHING but rash!
In order to successfully navigate the power struggles that occur around money, it is important to know how comfortable both you and you partner are with financial risk. It is also important to consider your relationship’s power dynamic and your personal relationship to money and power. Acknowledging these different perspectives can help you to understand where your partner is coming from when you find that you are locked in a power struggle about money.
Recognizing your financial past (your money gram) and understanding eachothers’ risk-taking tendencies can help mitigate personal financial struggles.