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Tips for handling money stress in a relationship

Key takeaways

Facts about financial stress

A recent survey has revealed that money is the leading cause of stress among Canadians.

According to the 2023 Financial Stress IndexOpens a new website in a new window, 40% of Canadians say money is their biggest concern, outranking personal health, work and relationships. Money issues can of course add stress to a relationship or marriage, and can lead to mental health issues such as anxiety and depression as well.

If you’re dealing with financial worries as a couple, the good news is there are many steps you can take to help manage your stress and make a plan to get back on track.

Start an honest conversation

It’s important that if you’re managing money with your spouse or partner that you share with them how you’re feeling.

Avoiding talking about money or hiding the facts about spending or other financial difficulties can make a tough time even harder. Being honest with each other as a starting point can help reduce anxiety and has many other benefits:

  • Sharing your thoughts and feelings as well as the facts about your financial status can help reinforce that you’re in this together.
  • Your partner may have past experiences or insight that can help or that you may not have thought of.
  • It can help determine how you’ll allocate a windfall of money such as an inheritance.
  • It can help to plan for how you’ll deal with financial emergencies.
  • It can help to confirm you’re on the same page about your future together, and the role your finances will play in it.

Importantly, you shouldn’t feel embarrassed about talking about money with your partner. Whether you’re struggling with debt, budgeting, low income, job loss or any other issue, it’s important to realize that money issues are common and that by sharing honestly, you’re taking the first step towards moving in the right direction.

Review your financial situation

If it’s been more than a year since you’ve reviewed your finances, now could be the time for a check-up.

There could be many reasons why your financial status now has changed over the course of a year. Perhaps you’ve made a big purchase or experienced a big life event, such as buying your first house, getting married, relocating, or starting a family. There are also external factors to consider, such as the impacts of world events like the COVID-19 pandemic and Russia’s invasion of Ukraine.

Look over bank statements or online accounts, and ask yourselves:

  • How much money do you typically have left over at the end of each month once you’ve covered all the essentials?
  • How much money are you managing to save each month?
  • How much do you have invested for the future?
  • How much do you owe in debt, and what kind of debt (e.g. student loans, payday loans, credit cards, line of credit, etc.)? What are the interest rates and monthly payments?
  • Can some or all of the debts be consolidated to reduce the amount of accruing interest and/or reduce the monthly payments?
  • Is there a way you can pay anything off, especially high interest debt such as credit cards?
  • Are you managing to make your monthly payments on time and if not, are you being charged any penalties or fees that are increasing the amount you owe?
  • How have any late or missed payments impacted your credit scores, and how might this impact your future plans?
  • Are you finding yourself in overdraft and having to pay fees as a result and if so, how often?
  • Can any shopping or spending habits be changed? Can you cut back in one area (such as eating out) to help you elsewhere, such as paying off debt or contributing more to your pension?

Asking these and other questions will help you get an idea of where you currently might be struggling financially, as well as how you might be able to start making some changes to provide some immediate relief.

Create a budget

Once you’ve reviewed your financial situation, you may find that you need to re-work your budget to account for changes. Depending on your circumstances, you may choose to create a monthly budget, or budget by paycheque.

However, you choose to budget, a good place to start is by separating out your fixed and variable expenses.

Budgeting for fixed expenses

First, you’ll need an idea of what your fixed monthly expenses are. Fixed expenses are those that occur on a fixed date each month, and are usually essential bills and utilities such as: 

Budgeting for variable expenses

Once you’ve isolated when your fixed payments are due, you’ll need to work out how to cover your variable payments. 

The money left over from your paycheque once you’ve accounted for essential bills is known as disposable or discretionary income. This is used to cover expenses that aren’t bills or payments, but still amount to your overall cost of living, such as:

  • Groceries
  • Entertainment
  • Eating out
  • Gas
  • Clothing
  • Toiletries and personal care
  • Beauty and haircare

Update your financial habits

If when you look at these amounts you feel that you need to make changes to help manage your living expenses, clear your debt or save more, there are some things you can do to help re-arrange your budget.

Cutting back

Look for ways to cut costs from your monthly spending.

For example, you may curb eating out or limit yourself to 1 meal out per paycheque, cancel subscriptions you don’t use (or don’t use often), substitute less expensive items when grocery shopping or switch to a different store, and use points where possible to pay for things like movie tickets or shopping.

Having a clear idea of where your money goes each paycheque will help you to see where you can scale back.

Consolidating debt

If you’re struggling to keep on top of loan repayments or are finding they take up a substantial chunk of each paycheque, you may look at trying to consolidate this debt into a single lower payment.

Generating additional income

If even after creating a budget you’re still finding it hard to make your money stretch between paycheques, you could consider a second stream of income. You could have a clear-out and sell items you don’t need from around the house, or take on a second job to earn some more money. 

Don’t forget to save

Even when dealing with financial difficulties, it’s still important to set money aside to save what you can each month.

For example, it’s wise to have an “emergency fund”, or money saved to cover large emergencies that could impact your income, such as job loss or illness. You could also set up a ‘rainy day fund’ which may only have $500 - $1,000 saved to cover smaller, one-time purchases like car or home repairs.  

On top of savings to help you out now, it’s important to make sure you’re saving for your future as well. Products like a tax-free savings account (TFSA) or a registered retirement savings plan (RRSP) are ways to help you save for the longer term.

How much should you save each month?

The amount you should save a month will depend largely on how much money you have left over after you’ve covered your fixed bills and living expenses.

You may have heard of the “50-30-20 rule”, which means you allocate 50% of your take-home pay to your “needs” or fixed expenses, 30% to your “wants” (your variable expenses), and 20% to savings.

While it’s a popular method, it normally works best when budgeting monthly, and so may not apply when budgeting by paycheque.

Instead, you can set up a system where you contribute based on how much you’d like to save in total over the year rather than by a set amount per month, or you might set up a recurring payment to transfer money from each paycheque to your savings account as you’re paid, treating it as almost another expense.

However you choose to do it, saving a little is better than nothing. There are many benefits to saving early, including taking advantage of compound growth.

Get professional advice

If you’re struggling to solve your financial worries alone, there may be value in getting help from an advisor.

The 2023 Financial Stress IndexOpens a new website in a new window reveals that Canadians who get professional advice work with a financial planner are less likely to name money as a leading cause of stress than those who don’t, and are less likely to experience health challenges such as anxiety or depression linked to financial stress than those who don’t.

An advisor may be able to offer insight into ways to help you better manage your spending and feel more in control. They can also help you invest for the future and save for big milestones.

If you’re unable to engage with an advisor currently, there’s lots of help available through the Government of Canada.

For example, you could find free advice on managing debtOpens a new website in a new window, or search through their list of BenefitsOpens a new website in a new window to make sure you’re not missing out on any financial help to which you might be entitled to.

What's next?

  • Money worries can cause stress within a relationship, but talking openly and using budgeting tools and strategies can help you get on top of things.
  • Speaking to a therapist or other health professional either as a couple or individually can help manage feelings of anxiety and stress.
  • An advisor can also help you look at your financial situation now and provide guidance to help you achieve the financial future of your dreams.

The information provided is accurate to the best of our knowledge as of the date of publication. This information is general in nature, and is intended for educational purposes only. 

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