Financial Planning for Couples: A Comprehensive Guide

In a world where we learned about trigonometry instead of investing, it’s understandable why money and financial planning can be so tricky. Add in another person, and suddenly 1+1 = 3x the mess. This guide will walk you through the essential steps of financial planning for couples, helping you navigate the complexities and build a strong financial future together.

Starting to Talk Money as a Couple

Everybody has read the stats: money can be harder to talk about than death, sex, or religion. Financial infidelity is now the most common reason for divorce. Behind those stats, though, lies a critical insight. Most couples don’t set out to lie about money to each other. More often than not, it’s the buildup after months, years, or even decades of not talking about money. Sometimes intentional, but more often than not, out of negligence or avoidance.

So, the only way is through. And like a long hike, it gets easier over time. Talking about money isn’t exactly the type of fun like kicking back and having a cold drink on a hot summer day (unless you’re a rare kind of couple). It’s more like type 2 fun: where the hike was hard and may have even sucked at times, but you got to the top and you’ll always remember what it felt to have made it there.

First, What’s Financial Planning?

Financial planning often means something different from person to person because their values and goals may be different. The most important question for couples in financial planning is: what steps do you both need to take to ensure you have enough for what you want?

It starts with 4 key steps:

1. Know Where You Are

2. Know Your ‘Why’ (Goals)

3. Know Your ‘How’ (Budgeting)

4. Optimize Your Finances

1) Know Where You Are

The first step in the journey is knowing where you are today: what money do you have? Investments? Debt? What do you have individually and together?

Using tools like Plenty, you can start by connecting all your different accounts (or manually adding any you can’t connect) and flexibly choose what’s shared vs. private. By counting all the things you own (assets) and all the things you owe (debt), you get a number that captures where you are today (net worth). This number gives you something to measure and monitor to see how you’re growing your wealth month over month or year over year.

Plenty makes it easy to track your net worth for the three most common ways couples share finances:

• Fully Joint Finances: Use the “what’s ours” dashboard.

• Partially Joint Finances: Use both the “what’s ours” and “what’s mine” dashboards.

• Limited Joint Finances: Primarily use the “what’s mine” dashboard and selectively view shared cash flow/investments.

2) Know Your ‘Why’ (Goals)

Once you find where you are on the map, it’s time to talk about where you’re heading. “Goals” don’t have to be a scary term that locks you into anything permanent: it’s just your best guess about what’s most important to you. As you grow and evolve, it’s normal for goals to change.

For couples, discussing your goals is crucial to reduce conflicts. If you’re on the same page about what you’re working towards, it’s easier to feel like you’re on a team together. Instead of arguing over spending habits, you can have collaborative conversations about how spending impacts your shared goals.

In Plenty’s “Investments” tab, you can create shared or private goals. Common goals that couples share are provided to help you get started quickly, with estimates on how much you might need for each goal.

3) Know Your ‘How’ (Budgeting)

Great—you know where you are on the map and where you’re trying to head. Next, it’s time to chart the course to get there and understand what it may take.

The next step is to understand where your money is currently going: how much are you earning? How much are you spending? How much are you saving and putting aside?

By connecting your credit cards and bank accounts, Plenty can automatically pull in up to 24 months of history to help you understand where your money has been going. It detects your paycheck and investment earnings, labels them as “income,” categorizes your spending, and tracks all deposits into savings/investment accounts to show how much you’re saving each month.

With this understanding, you can start turning goals into action by setting up monthly deposits into the goals you’ve set.

4) Optimize Your Finances

For most couples, this is the hardest part. This is why we built Plenty, and we’re here to help. It’s normal to not know where to start or if you could be doing something better.

Our mission from day one was to make wealth possible for every household. We’ve made the investment products of the wealthy easily accessible for everyday couples using Plenty.

Our first three products:

• Cash+: Earn 4.40% 7-day yield* to 13x the national average.

• Classic Portfolios: Effortlessly begin investing with ETF portfolios created and managed for you at 0.20% per year (a fraction of the 1% average for financial planners).

• Premium Portfolios: Access advanced tax-loss harvesting and values-based customizations through direct indexing at the same low 0.20% annual fee.

Learn more here: Plenty Blog on Direct Indexing

Once We’re Started, Then What?

You’ve taken some big steps together. Next, it’s time to revisit your goals and see how you’re doing. For some couples, this means a monthly review. For others, one partner might check more regularly, and they look at things together every couple of months. Whatever cadence feels right, set a recurring calendar invite and make it fun.

Life’s not just about working hard; it’s also about enjoying it. So when planning your money date, make it enjoyable. Some couples love to talk over dinner with a bottle of wine. Others reward themselves after the discussion with a movie night, dancing, or hiring a babysitter.

If you have more questions about how to get started with your partner, we’d love to help. Send an email to writing@withplenty.com and we’ll get back to you.

By following these steps, financial planning for couples becomes a manageable and rewarding process, setting the foundation for a secure and prosperous future together.

About Plenty

Plenty is a wealth management platform designed specifically for couples. We go beyond budgeting, making it simple to invest, save, and grow toward your future goals by unlocking access to the financial strategies of the wealthy. Ready to get started? Sign up for free today.

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*Plenty's cash management product invests 99.5%+ of the portfolio in US-government backed securities as of November 14, 2024. Although the strategy seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. You could lose money by investing in the strategy. Plenty's cash management product is SIPC insured. An investment in the strategy is not a bank account and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The rate quoted is subject to change and will decrease or increase based on changes in market conditions, interest rates, among other factors. The rate quoted is net of transaction and advisory fees.

The information provided herein is for general informational purposes only and should not be considered individualized recommendations or personalized investment advice. The type of strategies mentioned may not be suitable for everyone. Each investor should evaluate an investment strategy based on their unique circumstances before making any investment decisions.

Investing involves risk, including risk of loss. Past performance may not be indicative of future results. Asset allocation, diversification, and rebalancing do not ensure a profit or protect against loss in declining markets. Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.

Tax-loss harvesting involves certain risks, including, among others, the risk that the new investment could have higher costs than the original investment and could introduce portfolio tracking error into your accounts. There may also be unintended tax implications. We recommend that you consult a tax professional before taking action.

Plenty does not provide legal or tax advice. Where specific advice is necessary or appropriate, individuals should contact their own professional tax and investment advisors or other professionals (CPA, Financial Planner, Investment Manager) to help answer questions about specific situations or needs prior to taking any action based upon this information.

All expressions of opinion are subject to change without notice in reaction to shifting market, economic, and geo-political conditions