Before I get to the love stuff, we’re continuing to (loosely) track the saga of fraud detected from within the user base of TurboTax. Again, charity (and/or my lawyer) requires that I emphasize that the makers of the tax software seem to have done everything they possibly could to ameliorate the problem and respond well.

But now it seems that federal returns (not just state tax returns) may also be threatened: http://www.forbes.com/sites/robertwood/2015/02/12/turbotax-fraud-may-impact-federal-returns-too-fbi-investigating/

Possible fraud is just one reason to be cautious when submitting your tax and financial information to the government through a consumer software.

Also on the list: in-person help, years of expertise, a support option that doesn’t include phone-tree Siberia (a better option: (410) 224-2600), and more.

But again, I don’t want to pile on too heavily. We’d love to serve you this year — and take all of the annoying paper/software headaches off your hands. It’s what we do best!

And speaking of not piling on … how’d you do on Valentine’s Day? Perhaps it didn’t really apply to you this year, or perhaps marriage isn’t on your immediate radar.

But for many of my clients, the real work of love is forged through the stuff of everyday life. Not just on one particular day. And, of course, money is a big part of that.

I’ve noticed that *finances* can be a major sticking point in a good marriage.

But there are some simple steps you can take (five, by my count), which will ensure that you don’t ever fall into the trap of letting a good marriage be spoiled by money miscommunication.

Read on, and send your feedback. And, of course, if you need help with any of this, or if you have any pressing tax issues or questions, email me back, or call us at (410) 224-2600 . We *love* serving YOU…..

Valerie McLaughlin’s
“Real World” Personal Strategy Note

Great Financial Communication in a Marriage
“Lots of people want to ride with you in the limo, but what you want is someone who will take the bus when the limo breaks down.” – Oprah Winfrey

Money problems can ruin the love affair with your spouse. The work of blending two lives in harmony requires certain basic commitments. It’s a fact that many families today are financially troubled.

Most of these families are in denial. The rest of them are looking for a quick fix. Even a financial planner can’t help unless the couple is willing to make five simple commitments. You can always choose to find something to fight about. But if you are serious about removing the financial obstacles in your love life, try to commit to the following money management rules.

1) First, take the time to provide open accounting to your spouse. Most financial arguments are not about how to spend your money–but about how the money was actually spent. Just like every publicly traded company is required to give a public accounting of its finances, couples should do the same. In the public sector, it’s considered a scandal when a corporation fails to provide its financial information in a timely fashion. The same rules apply at home. Financial accountability, openness, and honesty are essential in marriage.

2) Next, make a saving investment the first priority. Pay yourself first. Couples should agree on the amount and rate of savings–then prioritize their savings above all other budget categories. Savings should be automated and protected from impulse spending habits.

I’ve come to believe that, in certain cases, savings might even need to be prioritized above debt reduction. I’ve found that some couples that are in debt can’t seem to get out of debt because they’re using what should be going into savings to service their debt — rather than adjusting their lifestyle so that they are spending less than they make. This can sometimes make that debt spiral worse … but again, should be considered in light of the bigger picture. Get your spending under control! Which leads to …

3) Set a limit on what you can spend without first getting the approval of your spouse. Each spouse must sign off on spending that might be a budget buster. If you are young or your finances are in trouble, the amount should be fairly low. As you get more experience and your finances are in harmony, you can raise the amount. Any purchases above that amount should require the agreement of both spouses.

In the same way, any purchases beyond what was budgeted should require the agreement of both spouses as to which budget category is going to be reduced in order to make up the difference. If your spouse asks you to wait before making the purchase, lean toward waiting graciously. Ask what you would do if you did not have the money at all. Delaying a large purchase even by a month can significantly increase your financial health.

4) Set rules for the acceptable use of credit. In my experience, the easy use of credit cards ruins much financial harmony. It’s better when the use of credit cards is limited to only certain required budget items. Using a credit card for groceries or gasoline may be harmless. But when credit cards are used for clothes or eating out, optional spending is unnecessarily inflated.

There are several advantages to using credit cards. But each of these advantages become powerful disadvantages for a family struggling to make ends meet. Credit allows couples to avoid asking the tough question about what they would do if they didn’t have the money. Credit makes spending easy and simplifies check-writing. These advantages are about as helpful as giving an alcoholic a place to sleep in the back of the bar.

Either spouse should be able to veto the use of credit cards entirely. Only if both parties agree to the use of credit cards, should they be allowed – and then only within certain guidelines.

Credit should only be used for specific required monthly categories, and then only by the spouse who is less apt to make extra purchases on impulse. If you are struggling with your finances, stop using credit cards entirely.

5) Lastly, agree together that ignorance is no excuse! Both parties must be willing to learn. Just like a good love life, finances cannot be handled well by just one party. Many problems stem as much from ignorance and abdication by one party than spending by the other. If you don’t have the time or the interest to be involved in the family’s finances, then you may be the problem. Ask for help and start learning.

Look, I’m not a marriage counselor. But I DO know good communication when I see it.

I hope this helps.

Warmly,

Valerie McLaughlin
(410) 224-2600