The Nitty Gritty Of Real Numbers
Specificity is vital and it's when we get specific that things can get hairy.
Most people talk about their dreams and financial aspirations in wishy-washy 50 000 feet high terms because at these lofty vague heights they are not threatening or even vaguely real.
Let's get edgy and talk about real numbers.
You must know your own and your partner's numbers and create a joint set of numbers which show you what is going on in your money world.
- What money flows in?
- What money flows out?
- What assets do you both have?
- What liabilities (debts) do you both have?
The Inflows
Earnings have nothing to do with worth.
We are an income obsessed society. Earnings have become a twisted and terrible metric of worth, power and authority.
Earnings should never define who has more value, authority or power in a relationship.
This is one of the hardest things for most of us to uncouple.
I had to delve into my unconscious entanglements of money and self worth in my previous relationship. Also unconscious rules about who “should” earn more and what that meant.
There was a time when I earned a lot more than my ex-husband. I realised I had started to lie about what I earned. I managed the money stuff in our relationship. I invested, controlled, and managed the money completely so my lying was not overt. But I realised I was fudging the specifics because I had a weird and funky unconscious rule that as a woman I should not earn more than my male partner. At some level I felt I was breaking a rule! WTF!!!
When I realised I was doing this, I knew it was my stuff not his.
If asked about it, I might have had a knee jerk response about… "Oh, well he might have judged me and I wanted to avoid that."
I was the one doing the judging.
I had judged myself against a money story I had saying a woman is not meant to earn more than a man in a relationship. Through my actions I was betraying the unspoken balance of the way the world's meant to be.
I had the rule, not him. It was my work to do to be OK with earning more.
I wanted to earn lots of money and worked hard to do so but this unconscious rule made me feel guilty and ashamed about what I made.
I was terrified of being rejected or shunned or being stoned or whatever happens to women who break the rules.
To let this go I had to own that this was my own sh*t.
Being outraged by society or my upbringing would just be another form of rejection of me.
I was perpetuating this story and if I wanted it to stop, it was up to me to stop it in me first.
The warped relationship between earnings and worth, and the numerous stories and rules we havehttps://thewealthchefbook.com/ about who earns what and what that means is such an important conversation to unpack because it ripples into all the other areas of our relationship and lives.
I see so many situations and relationships where the person who earns the most is then meant to be the one who “does the money stuff”. They are now also meant to manage it or invest it because somehow they are now the financial powerhouse in the relationship.
Our ability to earn has no correlation to our ability to manage, save, invest and grow money - and certainly no correlation to getting the most from it.
When we recognise that inflow is just one little part in the wealth creation process we appreciate it but we don’t give it undue importance.
We need to acknowledge that society values different types of jobs and activities differently. What you earn speaks to what society currently values, and not to your value.
When we uncouple earning from value we can celebrate what comes in cleanly. What you earn and how you earn it are not measures of your self worth or your partner's self worth.
Your Partnerships Reservoir Account
I encourage you to have one combined reservoir account where all the money in the relationship flows into.
No matter where that earning comes from, whether it's from direct active employment, whether it's from cash flow machines, whether it’s a bonus or a tax refund, whether it’s from your low input businesses, or from asset generated wealth… it all flows into the joint reservoir account.
This is a dam where your money gets neutralised.
It's no longer yours or mine.
Who earned it or how it was made makes no difference. It’s just money. Your combined money to be used in service of the relationship.
This is a HUGE step for most people. Notice what comes up for you as you read this.
Is there resistance to it?
If so, what is the resistance about?
Do you not trust the other? Do you not trust yourself?
What is the story that you have around this?
Once you have your central reservoir which all money flows into and where it neutralises, you then jointly make decisions on how best to use and allocate the money based on your vision and goals and not based on the source of the money.
If you are aligned on your goals around what you want, you're going to want to allocate that money to serving your both. It doesn't friggin’ matter who earned it or how. Being free from those warped associations you can now make your money decisions in the best interest of you both and your relationship. Perhaps you want one person to be a stay-at-home parent or one of you to be able to focus on a new career or business. Those are choices that you make together in alignment to what you want from a relationship, not based on who earns what.
I'm going to mention financial infidelity again.
You’ve got to ensure there's no hiding or money stuff - earning, investing, borrowing or spending.
If one of you has a sneaky income stream that you hide away from the other… you will cause disconnection and mistrust. Financial infidelity is when you have financial secrets. It is where you breach your agreements and cheat on each other financially.
Managing Your Money
You must put a money management system in place to manage and allocate the flows out of your reservoir.
Implement Wealth Pie in the relationship together.
This system defines how you allocate the money to serve you now, in the medium term and ensure your longer term financial wellbeing and freedom.
In The Wealth Chef Book I share with you the powerful Wealth Pie Money Management System and with the book you also get a short video training series covering each of the Five Recipes For Wealth.
I believe both people should be fully involved in the management of the money but this doesn’t mean you both do all the activities for that management together. You are going to have different skills. Get to know what they are, celebrate the differences and divide and conquer.
Financial Roles and Responsibilities
Get clear about your roles and responsibilities within your relationship.
When you've done your personal money audit and revealed your numbers. Decide who will do what in your money world.
What are your strengths and competencies?
Is one of you great with spreadsheets?
Does one of you love tracking stuff?
Who loves making life organised?
Yes, there are people who love to do this stuff.
I've always enjoyed giving order to my money stuff.
There is a difference between who is responsible for doing a task and who is accountable for the overall use of that output.
You are jointly accountable for your financial vision and you will each be responsible to complete different tasks to achieve that vision.
Just because one person updates the spreadsheet or the spend tracker doesn't mean they take responsibility for managing the way money flows out. You have to come together and be jointly responsible for the decisions around where your money is going, to interpret the information your spend tracking is telling you and to implement the necessary adjustments needed to get you where you want to go.
Day To Day Money Flows
The gold standard in intimate, connected, full partnership relationships are joint accounts.
You put your monthly necessity amount from your joint reservoir account into a joint transaction account and your day-to-day necessities and everyday type spend comes from this one account.
You would typically both have debit cards on this account so you can both transact on it and would both have transparency around what is being spent from this account.
The point of the joint accounts is transparency and equal adult to adult relating. You need to both know what's going on in your money world. If one of you in the partnership doesn’t want to know what's happening with the money stuff and wants the other to ‘’’handle that money stuff", there will be discord and dysfunction. You cannot have an intimate, vulnerable and deeply connected relationship when you are not aligned energetically and relationally.
Addictions, Gambling and Dysfunctional Debt Patterns
Having complete transparency and joint access to accounts is the gold standard, but we have to be aware of exceptions where having equal access to these accounts and funds would not be in service of you or the relationship.
If you know that one or the other of you have some serious money triggers - for example emotional spending or a late night amazon habit that you're still working on sorting out - you've got to be clean and honest about that.
If either of you have any sort of addiction challenges, gambling issues, or a pattern of going into debt - it is really important you don't set up structural frameworks for your relationship that set up a person to fail.
Until you have a mechanism to control dysfunctional spend habits it would be unhealthy for you and the relationship to give you full access to the joint accounts. The same applies to credit cards. Don’t tempt yourself or set your partner up to fail.
We have to be sensible and supportive of each other. Money and the systems for managing it must be in service of both your greater good.
The Outflow
Wealthy spenders know what is important to them and they spend money freely on those things and radically reduce the stuff that isn’t aligned to their vision and values.
Simply put…
Stop spending money on sh*t that doesn’t light you up and
doesn’t take you closer to your freedom.
Understand the different types of expenses we all have in our lives and get clear on what “joy filled expansion spending” is for you both. What do you love spending money on?
What brings you joy?
What brings your partner joy?
How do those overlap?
Is it travel? Is it experiences? Is it a beautiful home? Is it tech stuff? Is it a sport or a hobby?
Then agree on your spend planning and ensure it fits into your wealth pie targets and aligns to your overall financial goals.
I don't like using the word budget - a budget feels so constraining, all about restrictions and what you can’t have. A spend plan on the other hand reminds you that you choose where your money goes.
What you choose to spend your money on defines
the quality of your life now AND in the future.
You must be aligned on your spending and create a monthly spend plan that allocated your money in a way that brings you peace of mind, joy and financial freedom.
Know you spend boundaries and values and plan your money outflows together.
"We've got X amount to spend on a holiday - what do we want to do with it and how can we get the most joy from this money?”
“We've got X amount to spend on entertainment - what lights us up and fills our joy tanks”
“We have X amount to spend on play…, Z amount to spend on the kids or the fur kids…."
Go through each spend category and decide in advance how you’re going to spend your money.
You need to have spend boundaries and financial fidelity.
Knowing you can trust each other to respect your jointly decided spend boundaries brings another profound level of trust into the relationship.
If you set these up and then one of you breaches that agreement, you will create real schisms in your relationship.
These betrayals become sandbars that become brick walls and before long- two people are living in mistrust and disconnection.
Take your spend planning seriously
and treat your agreements with respect.
Set up spend agreements, giving boundaries to each spend category.
Discuss and create agreements on whether you will use credit cards, for what type of spend, and up to what limit.
Have principles in place that govern how you will make decisions on sending that falls outside of these spend limits.
Remember to be specific. Don't say, "Hey, can we have an agreement that if we're going to spend a lot of money we will ask each other about it or just check in with the other."
Set the specific limits and triggers that require specific actions.
“If either of us want to spend an amount outside of our spend category limit and / or over (say) $500 then we must alert the other and set up a time to discuss the spend and decide together if we will spend that money and if so what other spend category the money will come off”
Whatever that is, make it very clean and specific so there can be no ambiguity about when the agreement is triggered.
You must be tracking your spending. Full transparency. Even if you choose to have different accounts and a joint transactional account, all of the outflow, spend data should be brought into the partnerships spend tracker.
Remembering why you are doing this. You're doing this because money is in the service of your relationship. This is not about controlling each other. It is not about blaming or shaming each other.
Joint spend tracking is about knowing what you are doing with your money and ensuring it is aligned to your vision of what you both want and where you both want to end up financially.
Let Love Do It’s Work
It's been very interesting for me entering into a new relationship over the last few years and having to practise what I preach on money and love. It's been a magnificent opportunity to see what my stories are, and where I am still not yet free.
Regarding complete transparency… when it came to my assets and revealing my net worth, no problem. Very early on, we did the "I'll show you mine, you show me yours" around our balance sheets and it was a great and easy experience for us. But when it came to the details of what we spend our money on I felt huge resistance. I was really fearful of being judged on how I choose to spend money. I was afraid I might be thought of as frivolous or wasteful.
Being able to slow down and get curious about my own reaction I realised I had judgement about my own spending. There's still some baggage for me around spending and more work I can do on giving myself permission to be fully me - unashamedly - out loud.
Isn't that so funny?
I hadn't yet fully owned all of me or yet felt fully comfortable with being able to spend what I am able to spend.
That’s why I love this money stuff so much. It is such a brilliant revealer of where we are not yet free.
Most of the stuff that comes up in relationships are just projections of our own wounds and where we are not yet free. This is such a relief.
When friction and discomfort arises you can celebrate that love is doing its work.
Love is revealing where we still have work to do to reconcile our money trauma and get comfortable with who we are.
It’s OK If The Other Person Gets Triggered
The other person may very well get triggered and judgmental about the things you reveal.
That’s OK.
Stay in your lane.
It is NOT your job to pacify or regulate other person's emotions.
If (and when) this happens just treat it as useful data.
First check in with yourself and ensure you are not retreating, judging yourself, reacting or withdrawing based on your partner's response.
Your first responsibility is always to your own emotional wellbeing and doing what you need to do to ensure you can be IN fully with another.
If that means you need to get some space to self regulate then that is what you do.
Remember Gift #1 -
You promise to never betray yourself.
Notice their response and your own. “Fascinating, What's that about?"
They're going to be conflicting desires, different values, different views on how things should be done. When things like kids, ex’s, parents and so on come into the picture there is also a whole set of other expectations, beliefs and emotional charge that we have to be aware of and lovingly navigate - not avoid.
It’s OK if you get triggered. Again… “Fascinating, What's that about?" .
Get very curious whenever there is a disproportionate emotional response.
That is a brilliant clue that what is coming up is an old wound and not actually about the thing right in front of you.
In part 10 we dive into The Nitty Gritty Of Who Owns and Who Owes What. This is all about the balance sheet. If you thought income was a charged subject, wait until you dive into the assets and debts. Juicy!
