This video introduces the components of a healthy financial process: values, communication, clarity, negotiation, and compromise.
- With our Central Agreement in place, we are ready to explore a series of steps I call the Five Pillars. These Five Pillars are a blueprint to help you work collaboratively, and we'll go through each of them in turn to maximize understanding. As usual, we start with ourselves. In order to talk about money constructively, we need to be abl to identify what is important to us in terms of how we earn it, how we spend it, and the quality of life that we wish to create. This comes down to our individual values. Some examples of values are freedom to take a certain type of work, or responsibility to others.
When we talk about our values, we shift our framework around money from what we think is correct to what we believe is important. The former often leads to argument, while the latter is the basis for mutual understanding. The next Pillar is to establish the rules for communication. In the beginning, especially, we need a framework to help us keep from falling into the same old fight. It might feel awkward to follow what amounts to a script, but it's the way that we stay safe in the conversation, so that each person can be more honest and vulnerable.
We'll use a method called Active Listening, which ensures having time to both speak and gives a sort of confirmed receipt that the message was heard. In that safe space, we have the opportunity to translate our values into a concrete Ask. The great thing about money is that we can quantify it. We can say, "I want us to be able to put X dollars a month "toward this thing that means so much to me." That doesn't mean that your partner will see it exactly your way, which brings us to Pillar number four: Negotiate.
Yes, you need to be open to negotiating for yourself and your stake in this process. But in this case, we're not trying to beat the other person. Only win-win negotiation is considered good negotiation here. The whole is bigger and more important than the sum of its parts. Finally, we compromise. Each person will probably need to make sacrifices to get to a working plan. If that sounds scary, remember our Central Agreement is to be inclusive, transparent, equal, flexible, and sustainable.
If one partner is asked to sacrifice too much, it violates that initial agreement. Perhaps the negotiation wasn't equal, or the sacrifice won't be sustainable. It may take some tinkering and some practice, but that's why we keep the Central Agreement in place: as both a reference and a system of checks and balances. I recommend you work through the Pillars sequentially, giving each one the focus it requires. Part of what you're doing is laying the groundwork for a whole new way to engage with each other, so take your time.
You're never done with money, so there's no benefit to rushing toward an imaginary finish line.
In this course, financial therapist Amanda Clayman shows how to tackle the financial difficulties that often sour partnerships by walking through how to create and follow a family cash flow plan. Using her five pillars of financial harmony as a guide, Amanda explains how to construct a plan that engages all family members in its implementation. Looking at money management as a system designed to meet your specific needs, she highlights common financial conflicts and shows how to create a healthy, sustainable plan. She explains how to establish ground rules for communicating effectively, prioritize each partner's "asks," assign money management roles suited to each partner's strengths, and bring it all together into a working plan.
- Why couples fight about money
- Exploring values
- Communicating effectively
- Being clear and concrete
- Negotiating successfully
- Assigning roles suited to each partner's strength
- Setting up a routine
- Creating your family cash flow plan
- Dealing with dilemmas
- Making changes
- Engaging children in your family's cash flow management process