Conscious Spending for Couples: Seven Skills for Financial Harmony


"Love and money. Romance and the ultimate romance killer. Somewherebetween the first date and the first shared utility bill, moneynudges into a relationship, creating a threesome that is sometimesharmonious, sometimes hard to deal with."
?Deborah Knuckey, from Conscious Spending for Couples

Money may not be the root of all evil, but conflicts over moneycan be the greatest source of trouble in a relationship. Arguingover money aggravates the frustrations, fears, and control issuesin any relationship, and those ...

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"Love and money. Romance and the ultimate romance killer. Somewherebetween the first date and the first shared utility bill, moneynudges into a relationship, creating a threesome that is sometimesharmonious, sometimes hard to deal with."
–Deborah Knuckey, from Conscious Spending for Couples

Money may not be the root of all evil, but conflicts over moneycan be the greatest source of trouble in a relationship. Arguingover money aggravates the frustrations, fears, and control issuesin any relationship, and those hot-button issues can, in turn, makeit more difficult to manage money sensibly. If this syndrome soundsfamiliar, Conscious Spending for Couples is here to help.

In this commonsense guide, money coach Deborah Knuckey appliesher "Conscious Spending" approach to help couples strengthen theirfinancial relationships. Conscious Spending is the art of aligninghow you use your money with what you truly value–minimizingthe money spent on things you enjoy less to free up money for whatyou enjoy more. Knuckey examines how men and women differ in theway they handle money and how these differences can prevent acouple from moving toward financial bliss. She then introducespractical tools for effective money management–based oninterviews with couples from a wide variety ofbackgrounds–exploring real financial interactions and gettingdown to the root of what works and what doesn’t in a diversegroup of financial situations involving couples.

To help navigate the complicated relationship between acouple’s financial and emotional lives, Knuckey introduces the"Three Rules for Financial Bliss" that focus on how you and yourpartner can establish a fair and strong financial foundation. Next,she outlines the "Seven Skills for Financial Harmony"–skillsthat will help couples become conscious of their money and createan abundant future. Working together, you and your partner willlearn how to:

  • Plan together
  • Create a simple structure
  • Establish good financial habits
  • Communicate through conflict
  • Invest for strong returns
  • Create a safety net for two
  • Get help when you need it

Knuckey will also guide you and your mate as you take a detailedlook at the four biggest decisions you will make in your financiallives–such as buying a house and retiring–and find waysof approaching these decisions that will work for both of you.

Simple quizzes and checklists help you determine what needschanging in your financial relationship and how to make thosechanges as painless as possible. Conscious Spending for Couplesgives you the skills and confidence to use money to create joy andharmony in both of your lives.

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Editorial Reviews

From the Publisher
"a perfect book for newlyweds or any couple mired in debate overwhether to spend or save." (Bookpage, January 2003)
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Product Details

  • ISBN-13: 9780471221401
  • Publisher: Wiley
  • Publication date: 10/22/2002
  • Edition number: 1
  • Pages: 320
  • Product dimensions: 9.00 (w) x 6.00 (h) x 0.75 (d)

Meet the Author

DEBORAH KNUCKEY is a writer, money coach, and speaker. Her"Conscious Spending" approach, highlighted in her first personalfinance book The Ms. Spent Money Guide (Wiley), has been featuredon Oprah and in USA Today. Knuckey has an MBA from UCLA and hasworked as a consultant at McKinsey & Co., and as a financialreporter at News Corporation. She writes regularly forWashingtonian magazine and lives in Washington, D.C. Her Web siteis

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Read an Excerpt


Conscious Couples and Financial Harmony

Her face catches the candlelight and the murmur from other tables envelops them in their plush corner booth. A dark-lashed waiter tops up their champagne, clears the plates, and fades into the background, leaving them alone. The man looks nervous, but happy, as he reaches for her hand. They bump fingers and laugh, then he wraps his strong hand around hers and gazes into her eyes. "There is something I need to ask you," his deep voice resonating under the rising violins. She smiles, not breathing. "Will you commingle your assets with mine?"

Love and money. Romance and the ultimate romance killer. Somewhere between the first date and the first shared utility bill, money nudges into a relationship, creating a threesome that is sometimes harmonious, sometimes hard to deal with. For some couples, its intrusion sounds a warning bell--disagreements about money are said to be the largest cause of divorce. For other couples, it slides in easily, just another aspect of an already strong relationship.

Love and money are a complicated mix. Whether money is a source of conflict or cohesion, couples need to work together to create a strong financial relationship, and a comfortable financial future. Creating a harmonious financial relationship involves starting with what you have--two people with perhaps two very different views on money--and learning how to draw on each other's strengths and avoid each other's weaknesses. For some couples, a harmonious financial relationship comes very easily, but for most, it requires work and know-how.

InPerfectville, people live within their means, invest wisely, and leave their money untouched for years and years until it grows into a large and healthy sum. People also eat well, work out three times a week, and drive no faster than the speed limit. Ah--that's why Perfectville is a mythical place. People are human. They don't start saving soon enough, their plans change, they get their hands on their money too soon. They also drive too fast, hamburger in one hand, speeding straight past the gym. Bottom line: They get in the way of their own best intentions.

Conscious Spending and Couples

Conscious Spending is the art of getting more of what you want with what you earn. I created the term to describe the financial behavior required to use money as a tool to realize your dreams. It is the attitude underlying the behavior that is really key. Conscious Spending requires being clear about your goals and values, and being willing to make the short-term trade-offs needed to reach your long-term goals.

I coined the term Conscious Spending after seeing so many people blow through their income with very little of lasting value to show for it. Too many people are unconscious about how they spend their money. The result is that their money "just goes" before they can use it to realize their dreams.

When you are a Conscious Spender, you balance three competing goals: to live within your means, take care of your future, and still have some fun with your money. The first two goals are critical for sound financial management: You cannot have a strong financial relationship if you have a weak financial foundation. The last goal is not frivolous: You work hard for your money and this goal reminds you that it is completely valid to aim to get some of what you want with the money that you have. And having some fun with your money doesn't mean that you need to spend on passing fancies, such as the pair of shoes that caught your eye; it means doing whatever is really aligned with your personal values. For example, it may involve spending money on a very important goal such as educating your children.

Managing money alone can be tough. Managing money as a couple is even tougher, not because there is more money to manage, but because there are two sets of opinions, needs, and beliefs to take into account. A single Conscious Spender simply has to understand his own goals and make the decisions needed to reach those goals on his own. Conscious Couples have a different challenge: They have to work together to balance the "mine, yours, and ours" goals.

Financial Harmony

So what is the end goal a Conscious Couple aims for? Financial harmony exists when a couple work together to reach shared financial goals. Money becomes purely about money, and the appropriate actions to build a strong financial foundation are taken without conflict arising. Each of you lets go of the emotional games that drive some financial behaviors. Financial harmony does not involve having piles of money--and all the luxuries it affords--though it may if that is your goal and you implement a plan to make it a reality. And it's more than just not fighting about money. Financial harmony comes about when you are both being adult about money, letting go of childlike irresponsible behaviors or parentlike controlling of your partner's use of money. Money management happens easily and with little, perhaps no, conflict. Any disagreements about money are dealt with cleanly, not dragging in other emotional issues. And if other issues rear their head, they are acknowledged and managed as emotional, not financial, issues.

Conscious Couples who have reached financial harmony:

  • Treat money--and each other--with respect.

  • Commit to living within their means and taking care of their future.

  • Know what their major individual and shared goals are, what they will cost, and when they hope to reach them.

  • Develop a plan and follow it.

  • Understand how to meet their goals through smart spending and investing.

  • Protect each other, and any dependents they have, by putting together a strong financial safety net.

  • Communicate when concerns arise and work together to find solutions that are acceptable to both of them.

  • Get outside help as required to keep their finances and financial relationship strong.

In a financially harmonious relationship, financial roles and responsibilities may be distinct, but goals are shared. The result is two people working together to build a solid foundation. In some cases, the road to becoming a Conscious Couple is not long: In choosing your partner, you may have instinctively or deliberately selected a mate with compatible goals and financial behavior that supported those goals. For most couples, however, the journey to becoming a Conscious Couple requires work. It may require negotiating a shared set of goals. It may require changing behaviors and attitudes. It may require learning to communicate better with your partner.

Getting It Right from the Start

If we chose our partners for purely rational reasons, we would all marry spouses whose money styles are compatible. Issues about differing styles would be ironed out before the wedding day, a shared plan would be implemented using each other's best talents, and our investments would grow happily ever after.

We know love is not rational. Too many people fall in love with someone whose financial style is not only incompatible, but perhaps even an assault to their core values. Others do just fine until the world changes when baby makes three at the same time as the dual income goes solo. And sometimes boredom, loneliness, anger, or revenge gets expressed through the seemingly safer language of money.

It is not surprising that money becomes an issue in so many relationships. Talking about money and attitudes regarding money is unromantic, and throughout courting and the honeymoon stage it's easier to avoid potentially touchy topics. A conversation about money is riddled with land mines, raising questions such as:

  • Does he think I'm after his money?

  • Who is she to question what I spend my hard-earned money on?

  • Will she respect me if she realizes she earns more than me?

  • Why should he care how much I earn if I am going to stay at home as soon as we have kids?

  • Is he going to make me sign a prenuptial?

  • Is she going to take me to the cleaners if we get divorced?

  • What will he do to my credit rating?

  • Will she make me feel guilty for every penny I spend?

Talking to a potential partner about money issues is difficult for both men and women. Men have been socialized to play the role of provider and may be reluctant to start a conversation that could suggest that they are unable to take care of the whole household. Many women fear that they will appear to be gold diggers, more likely to have read How to Marry Money than this book. (Yes, it exists. No, I won't give the reference. If you want a book like that, you have to find it yourself.) For either person, caring about how much your potential partner makes and how he or she spends seems shallow. Besides, isn't love supposed to conquer all?

So instead of opening up hearts and wallets and bank statements, many couples avoid the awkward, until the awkward finds them.

The Elephant in the Room

Most of us are brought up not to talk about money. Often our parents would not discuss their finances in front of us. And we are more likely to know the details of friends' sex lives than we are to know anything about their financial lives. Money is the new sex: a taboo topic that is hard for many people to talk about, even within an intimate relationship.

In addition, the very process of becoming a committed couple changes how money fits into the equation. A silent power struggle often takes place as two individuals attempt to find the balance between independence and interdependence. In our attempts to pretend a relationship is between two exact equals, we avoid admitting that money often represents power within the relationship.

Yet even if we are willing to talk about it, do we really know all the emotional meanings that we link to money, or do most remain hidden, even to ourselves? Psychologists Edward M. Hallowell and William J. Grace Jr. point out, "Most people surround their feelings about money with so much anxiety that they are unable to focus on the topic long enough and calmly enough to discover its various disguised meanings." In Chapter 2, I discuss the many meanings applied to money.

Money and Conflict

Not all relationships have conflict about money, and not all conflict-ridden relationships fail. Yet, if there is conflict about money, it has a cost. Financially, the underlying behavior that triggers the conflict may be costing you a comfortable future. And emotionally, the conflict eats away at the caring and respect in your relationship.

Many marriages start out with other areas of conflict taking center stage; however, psychologists Daniel Sternberg and Ernst Beier found that within a year or so of marriage, money is usually the top troublemaker. They interviewed couples shortly after marriage and then a year later to determine if the sources of conflict changed over time. "The three most significant topics of conflict for the newlywed husbands were concerned with politics, religion, and money, while husbands, a year later, rated their most significant conflicts as money first, politics second, and sex third. With wives it used to be friends, politics, and money, but now it is money, friends, and sex." The toll? Husbands were not any unhappier from one study to the next; however, "wives... showed a significant increase in unhappiness. Altogether, there was a change for the worse... It seems from this data that the first year of marriage sheds illusions and centers on hardcore problems."

The honeymoon is over. Too often relationships suffer over financial issues. Money is fertile soil to grow marital discontent. Poor money management can lead to fights about money. And constant fights about money can deliver a fatal blow to a relationship.

Money problems are only one of the catalysts of divorce. Researchers find that jealousy, infidelity, spending money foolishly, and drinking or using drugs are the most consistent predictors of divorce. "These problems appeared to increase the odds of divorce, regardless of which spouse was perceived as having caused the problem and regardless of whether husbands or wives were the respondents." Yet compared to other causes of conflict, spending money foolishly, along with jealousy, can pull the plug on a relationship fairly quickly.

Sometimes, though, money keeps couples together for all the wrong reasons. Divorce is expensive and leads to a decrease in living standards, and 70 percent of people surveyed say the lack of money has caused them to make some tough life decisions: about 18 percent saying they had stayed married because of lack of money to divorce.

So what's the cure? More money? No. No one has found that more money is likely to lead to a happier marriage. Stanley Koutstaal, in his doctoral thesis, found "no indication of a significant relationship between income and marital satisfaction." Couples tend to fight over what they do with money, not how much they have. However, if a couple is financially satisfied, they are more likely to be satisfied in their marriage. And the amount of income is only one factor affecting financial satisfaction. "For husbands, higher levels of financial satisfaction were associated with increased age, longer marriages, fewer children at home, higher family incomes, and a greater proportion of the family income contributed to charitable organizations. For wives, higher levels of financial satisfaction were associated with higher family incomes and a higher proportion of the family income being contributed [by the wife's earnings]."

For couples who argue about money, it is hard to imagine that money cannot only be neutral, but can actually be a source of connection. Money is the intersection between dreams and reality. It is the place where you can choose what is really important to you as a couple: how you want to live, what you want to do, where you want to go. As a Conscious Couple, you can use money as a way of building a life that meets both of your dreams.

Psychologist Marcia Millman sums it up in this way: "In the end, money doesn't corrupt love or families so much as it illuminates them. As the stain on furniture shows the deep grain of the wood, so does money reveal the hidden structures and rules of family life."

Does Conflict Matter?

In Seattle, a "love lab" studies what makes and breaks relationships. The head of the lab, psychologist John Gottman, has done probably the most extensive scientific studies of how couples deal with conflict. And his conclusion is surprising: "If there is one lesson I have learned from my years of research it is that a lasting marriage results from a couple's ability to resolve the conflicts that are inevitable in any relationship." Notice that he did not say it is about whether a couple has conflict, but what they do with that conflict. In his book Why Marriages Succeed or Fail he discusses three types of stable marriages:

  1. Validating: partners who hear each other's side of issues and seek to find common ground.

  2. Volatile: partners who don't hear each other's point of view in the heat of the argument and actively defend their own point of view.

  3. Avoidant: partners who minimize or avoid conflict, agreeing to disagree.

Although each type of marriage handles (or avoids!) conflict very differently, they can all be stable. "What is far more important than actually solving the issue or problem is feeling good about the interaction itself, and each of these types of couples has its own way to do that." The difference between couples that make it and couples that do not boils down to the balance between negative and positive actions and feelings toward each other. And couples should aim to be Conscious Spenders not only to eliminate one of the most common causes of relationship tension, but also to build the likelihood of positive interactions around money.

Coulda, Shoulda, Woulda

Geetha, a 27-year-old graduate student engaged to Richard, recognizes that her family's culture has influenced her spending style. "My parents came here from India, and for new immigrants, there is a certain status in being a consumer. You know you have finally arrived when you can purchase things." Geetha finds her habits strongly influenced by her family, who are "very very consumer oriented: whenever they have free time, they go shopping." Although Geetha is what Richard, also a graduate student, terms "a responsible spender," Geetha admits, "I find myself shopping when I am bored and it is inevitable that I purchase something. It is really hard to break the habit."

Richard also comes from a family where shopping is considered a hobby, but he has rebelled against his parents' values. "Both my parents are big spenders. They are equating their value with the quality and quantity of toys they have to play with. That's not something I feel comfortable with; I would much rather go walking in the woods than go shopping."

Before they marry, Richard and Geetha are seeking to find a middle ground between Geetha's shopping habits and Richard's tendency to be overly frugal. It was only at Geetha's prompting that he replaced his disintegrating backpack that had seen him through 10 years of daily campus life with a smart one that was not much more expensive than the bargain basement version he would have chosen alone. "Having a joint credit card has helped a lot because every month we go through the bill and divide it out and see what we are spending," Richard says. They applied for a joint credit card to save fees and accumulate frequent flyer miles more quickly. "[Analyzing the bill] gets both of us thinking about how we are spending money. It's a healthy step and I think we are both good influences on each other."

Geetha and Richard are a perfect example of a financially mismatched couple who are doing a great job of finding a middle ground. They're doing all the things that couples need to do early in the relationship: talking openly about their differences, recognizing that many of their behaviors stem from their family histories rather than from active choices, and consciously choosing new behaviors that support their shared goals.

If you could restart your financial relationship, what would you do differently? While we cannot turn back time, this book aims to help you think through the decisions that you made in the past so you can make better ones for the future, building on what you already do well.

These are the financial matters you should have talked about before the furniture was moved in, the knot was tied, or the joint account opened. Money: what you earn, what you spend, what you want. What you think is okay, great, or terrible to do with money. What your credit rating is. What you want to earn. Whether you think debt is a convenience, a sign of weakness, or an entry ticket to consumer society.

What if you had had such conversations and found that your views were completely different and you had uncovered a huge well of conflict? Congratulations! You would have: (1) worked out what common ground could be found and compromised on the biggest differences; (2) found a way to get some of what you want while preserving the differences through a prenuptial; or (3) not married each other. Any one of these options is a better outcome than (4) spending a fortune on marriage counselors and divorce lawyers.

If you've never had these conversations, go directly to Part Three: Seven Skills for Financial Harmony. Do not pass Go. Do not collect $200. Or even spend it. Actually, do read through to there, but that is the place where there is a good framework for discussing money, starting at the positive place of where you want to go together, and then working back to how to get there from where you are.

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Table of Contents



Chapter 1. Conscious Couples and Financial Harmony.

Chapter 2. Understanding Each Other's Point of View.

Chapter 3. Managing Your Money Styles.

Chapter 4. Creating Financial Harmony.


Rule 1. If You Don't Got It, You Can't Spend It.

Rule 2. Follow the 80:20 Rule.

Rule 3. Even Big Kids Get to Play.


Skill 1. Planning Together.

Skill 2. Creating a Simple Structure.

Skill 3. Getting into Good Habits.

Skill 4. Communicating Through Conflict.

Skill 5. Investing for Strong Returns.

Skill 6. Creating a Safety Net for Two.

Skill 7. Getting Help When You Need It.


Decision 1. Where You Live.

Decision 2. What You Drive.

Decision 3. Whether You Have Children.

Decision 4. When You Retire.



Other Resources.


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  • Anonymous

    Posted November 11, 2002

    Solid advice that an easy read

    This is a great book if you are struggling to get your partner on the same page as you when it comes to money... or if you are struggling to get on the same page as him! It is one of the best structured books I have read, laying out the key issues in a way that is really clear. The dieas are stright forward but she puts it in a way that makes it both easy to understand and enjoyable - it is the first time I have wanted to have these tough discussions with my husband! I like the blend of finance and psychology and strongly recommend this book.

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