Red hearts to red flags – spotting love’s financial warning signs

Financial struggles can strain or even break romantic relationships. Picture: Independent Newspapers.

Financial struggles can strain or even break romantic relationships. Picture: Independent Newspapers.

Published Feb 14, 2024


Financial struggles can strain or even break romantic relationships. For example, one in five couples surveyed in a recent Fidelity study said money is their greatest relationship challenge.

Drawing from their years of expertise in personal finance, Farzana Botha, communications manager at Sanlam Risk and Savings, and Lee Hancox, head of channel and segment marketing at Sanlam, present a guide to “relationship financial flags”, helping South Africans navigate the complexities of love’s financial dynamics this Valentine’s Day.

“Decoding the financial red, beige and green flags in relationships can be the key to a financially healthy partnership – regardless of whether you are a newlywed couple, long-time partners or navigating the dating scene. Identifying these is not merely about avoiding pitfalls but building a foundation of trust and open communication that empowers couples to be financially confident and secure,” says Botha.

Here, Botha and Hancox delve into how South Africans can identify financial flags to help foster healthier and more transparent relationships.

Financial red flags: the warning signs

Financial red flags are indicators that something may be amiss in your partner's financial habits or attitudes. These include hidden debts, excessive spending, incompatible financial goals, and an unwillingness to discuss money matters. Botha says recognising these red flags early can prevent future financial conflict. She suggests individuals learn how to address these issues head-on and work with a financial adviser to ensure a healthy financial foundation for their relationships.

Hancox says: “Whether creating a joint budget, setting shared financial goals, or consulting with a financial adviser, action is key to overcoming these challenges. Remember, a healthy financial relationship requires mutual understanding, trust and a willingness to work together towards common objectives.”

Navigating beige flags: the grey areas

Beige flags are those quirky financial habits or minor issues that aren't deal-breakers but warrant attention. Examples include a partner who splurges on takeaway food instead of grocery shopping, a lack of interest in discussing financial planning, or tells lies about minor purchases. While these habits may not pose immediate threats to financial stability, they can indicate deeper financial attitudes or behaviours worth discussing to prevent potential conflicts down the road.

Botha says addressing beige flags involves honest communication about financial habits, goals and expectations. “It's about recognising these subtle signs and understanding how they fit into the broader financial dynamics of the relationship. Discussing these issues early on allows couples to prevent beige flags from escalating into more significant issues.”

Commenting on how couples can proactively address and navigate the nuances of beige flags to prevent future conflicts, Sanam Naran, counselling psychologist and founder of Conscious Psychology says: “Individuals could consider therapy to understand their triggers and feelings towards money so that they have enough self-awareness to know how this will show up in their relationship. It is important to have constant communication around these topics, to know yourself and your partner’s unique mindset around money so that you can mitigate any issues that may come up in the future.”

Celebrating green flags: positive financial behaviours

On the flip side, green flags represent the positive indicators that suggest a strong and healthy financial partnership between individuals. These green flags are crucial for fostering a financially harmonious relationship, which is essential for the overall health and longevity of the partnership. Botha says nurturing these green flags can significantly contribute to a resilient and supportive relationship where both partners feel secure and aligned in their financial goals and practices.

Hancox says: “Some green flags in a relationship include open and honest communication about finances, responsible spending, shared financial goals, agreed-upon budgets, understanding each other's financial perspectives, and valuing each other's thoughts about money. These indicators demonstrate a healthy approach to managing finances and reflect deeper trust, respect, and cooperation between partners.”

Recognising and addressing financial stress in relationships

Naran says financial stress can strain any relationship, and it's crucial for couples to effectively spot financial warning signs and try working towards reconciling these differences. She says couples looking to navigate financial stress should consider:

· Honest and transparent communication: Communication is essential to addressing financial stress. Couples should regularly discuss their financial goals, concerns, and expectations.

· Regular check-ins: Having weekly and monthly discussions about challenging topics, including finances, can help foster understanding and trust.

· Couple’s therapy: Openness to therapy can help one work through financial issues, often rooted in one's upbringing and perceptions of money developed from caregivers. Understanding one's thoughts, triggers, and feelings towards money through therapy can enhance self-awareness and understanding of how these factors influence the relationship.

· Aligning on financial matters: Couples should try to work through financial disagreements transparently and respectfully, finding common ground on financial approaches and goals.

· Budgeting together: Having a mutually comfortable budget and being comfortable with monthly expenses indicates financial harmony. Be upfront about who is responsible for what financially.

“I’d encourage South Africans to see a financial adviser together as a couple so they can navigate the planning process as a united front. This approach will also help them find a compromise concerning differing money personalities. Everyone has a different upbringing and view regarding money, and an impartial adviser can see both sides. This can help couples avoid non-serving habits and build on the good habits as a couple. As their relationship and love grows, their financial adviser will be there to assist them to adapt their strategies in line with their goals and needs,” says Hancox.

Naran adds that couples should try to nurture and grow their financial connection. “Knowing and valuing how your partner thinks about money is critical to finding financial balance. It's important to talk openly, figure out how to manage money together and separately and be ready to adjust to changes in your financial situation.”

Botha says: “This Valentine's Day, take the opportunity to reflect on the financial dynamics of your relationship. Acknowledging and addressing financial red, beige, and green flags can lead to a more transparent and harmonious partnership. Remember, financial health is a continuous journey couples navigate together, one step at a time.”