Create a Laser Financial Focus

Laser Focus

Spinning My Wheels

For the last few years, I have been struggling with my finances.  Sometimes I had more success and other times I had less success.  It seemed like a random thing.  I tried to save while trying to work more while also trying to stay within my budget.  But, the thing was, I was not making great progress financially overall.  When the New Year rolled around, I took some time to ponder this phenomenon and realized that I could experience greater success by employing the power of focus.  Since us ADDers love to hyper-focus on just one thing and excel at it, I figured, why not apply the same methodology to my finances?

Creating a Laser Focus

I looked at all the areas I could improve in financially: earning, saving, budgeting, giving, spending, etc. and came to the conclusion that I needed to focus on the earning piece.  Without this, nothing else would matter.  So I set one financial goal for this year: to make $2200/mo (after taxes).  My strategy involved continuing working at my local college and creating a research position at the non-profit I volunteer for.  Basically, I set out to have two jobs where I made $2200/mo between the two.  I figured if I focused on just one aspect of my finances I would experience greater success.

Results So Far

As it is the end of March, I have taken stock of where I was in January and where I am now.  I had only one job (the college) and made about $1600-1800/mo.  Now I have two jobs (the college and a contract job at the non-profit) and am making about $2100-2400/mo.  Yes, I am not saving any money.  No, my debt isn’t really going down much.  Giving is on hold right now.  And my spending is staying about the same.  The difference is my earnings have gone up and are closing the gap between income and expenses.  Finally, I feel like I am making some progress!

Achieve Greater Success In Your Finances

So, what is your goal for 2016?  Is it to build a small emergency fund?  To finally pay off that credit card balance?  Or is it to give more?  Whatever it is you want to achieve, choose one thing to focus on and put all your energy into it.  Then let the ADHD hyperfocus powers work their magic!  It is time to make your ADHD work for you, rather than against you.

Question: Which area of your finances, if there was a positive change, would radically improve your financial situation?  Ponder it, then make a plan, and then pour all your focus into it.  Watch your financial success bloom right in front of your eyes!

Debt Is Not A Moral Failure

Down and Depressed

Us ADDers struggle with so much in life. Relationships, friendships, jobs, school, daily living tasks, and more.  Our finances is definitely an area we are weak in. We have trouble staying in a budget, paying bills on time, even creating a budget, reining in impulse spending, and minimizing our debt.

I want to talk about the last one. If you are like me, you probably have a sizable amount of debt. And you probably feel rotten about it and very depressed. You feel guilty because you have all this debt. Others make you feel bad, whether intentional or not. People often judge you and treat you like you are a moral failure. And it hurts.

But then I read a blog post and it made me realize that just because you have debt, doesn’t mean you are a moral failure. What matters is how and why it was accumulated.

The Protestant Reformation

During the Protestant Reformation, a religious sect popped up, the Calvinists, who preached that ‘good’ Christians should work hard and strive to become as wealthy as they could. The more successful you were, the more pious and religious you were.

Faulty Premise

Fast forward 500 years later, and we still live by this same distorted belief system. The Calvinist premise is false — just because someone is successful and wealthy does not mean they are more spiritual than another who has little wealth or success in life. The bible never taught that — this was man’s invention. Wealth and success does not equate to personal worth or spiritual health.

For ADDers, this has specific application in our lives. Especially regarding debt. People go into debt for many reasons: foolishness (poor choices), carelessness, ignorance, desperation, and exceptional circumstances, to name a few. While some ADDers go into debt because of foolishness (knowing better but spending anyway), carelessness, others dig into the red out of desperation, ignorance, or circumstances outside their control. If a person with ADHD got into debt because of foolishness or carelessness, they need to admit their folly and own their failure. Now, don’t get crushed, because we know that failure is just a brief stop on the path to success (it is a learning experience).

But if the ADDer got into debt because of desperation, ignorance, or exceptional circumstances, they don’t need to beat themselves up about it. And they shouldn’t let others look down on them either. Why are we scum if we keep losing our jobs no matter how hard we try? Why should we be scorned if we didn’t know we had ADHD and it greatly affected how we managed our money?

Break free of the chains holding you back from financial success.  Learn from your mistakes and move forward in your life.

Money Tips For ADDers In Their 20’s

twenties peopleToday I was thinking about how ADD/ADHD affects one’s finances throughout the lifespan, from your 20’s right up into your 60s’s+.  There is lots of financial advice out there for non-ADDers for each decade of one’s adult life, but I thought an ADD lens would be useful for my readers.  I decided to combine my experiences with those of other ADDers I surveyed and found lots of gems.  Below are the insights I discovered.

Insurance

  • Prepare for the unexpected.  Get disability insurance.  Don’t think you don’t need it?  Think again.  Over 10% of the adult population develop a disability over their lifetime, and illness/accidents do not discriminate based on age – I know from firsthand experience when I developed arthritis at the age of 27.  Protect your ability to earn and get retraining if needed.  You will be glad you did.  Compounding ADD with another disability can be crippling – protect yourself.

Debt 

  • Watch how much debt you accumulate – the propensity to spend is strong and if left unchecked, can escalate quickly.
  • Only take on debt if you have to, and only for higher education, not anything else
  • Avoid credit cards like the plague

Saving

  • Get in the habit of saving 10% as early as possible in your 20’s – build the habit that will last a lifetime and you will thank yourself when you struggle with maintaining solid employment, you have a health problem crop up, or you have a child before you are ready.
  • If you can’t save 10%, save something, every month – make it automatic too

Education/Training

  • Discover what you love to do more than anything else, and then find a job / career that matches that.  The money will come afterwards and you will LOVE your job (which is good because you will spend the majority of your life doing it!)
  • Research the career field you are interested in and make sure that it has jobs and that it can pay well enough to live on (but you don’t need to get rich, you just need to make enough to live)

Spending

  • Beware the ‘shiny’ syndrome when making life choices such as where to go to school, where to live, what car to drive, etc.  Be aware that you are predisposed to like shiny new things but will tire of them quicker than most people.  Make sure you really want it.  I really got into the green organic food crazy in my 20’s and my food bill went from $400/mo. to over $1000/mo.  Needless to say, it got out of control and helped balloon my debt load.  A very poor choice.
  • Live a minimalist lifestyle.  Travel light.  It will save you tens of thousands of dollars!
  • Try to take alternative transportation options besides a car, such as transit, walk, bike, etc.  You will be healthier and safe lots of money!  Don’t spend money on things that lose value – and cars do lose value!
  • I have one friend, Ril Giles – SuperADDmom – an ADHD coach, who found a great way to keep one’s entertainment budget down.  She said to make your entertainment be about people, not about spending money.  For example, throwing a potluck, hosting a games night, finding free stuff to do in your city, joining free online communities, etc.  An excellent piece of advice.

Money Management

  • Find a money management system that works for you and use it (whether it is cash in envelopes, online banking, automatic bill payments)
  • Try to use cash and debit only (it will make bookkeeping easier and will always enable you to get a ‘snapshot’ of your finances anytime you need it – credit cards have a 3 day lag time, which makes budgeting harder)
  • Find a money buddy to hold you accountable for your spending decisions and to help you stay on track.  Even if you make small stumbles, they can help you avoid the huge catastrophic mistakes in your 20’s
  • Learn to listen to others’ advice, even if you disagree with it.  Think about why they are offering the advice – is there any merit to it?  You don’t have to take anyone’s advice, but you should at least listen, in case you have missed something important during your planning stage of a decision.
  • Check your bank balance daily to make sure you know where you stand financially.  All it takes is 2 min and it can provide real-time feedback on spending and current level of savings in your account.

Giving / Sharing

  • Start giving regularly, even if it is in small amounts.  It is important to learn how to share with others from your bounty (even if you don’t think you are rich, you are by global standards – half the world’s population lives on less than $1/day).  An added bonus is that you will become happier and it makes you more attractive on the dating scene (not a bad benefit, eh?)
  • Give of your time as well as your money.  You probably have more time than money at this stage of your life, so put it to good use and for the betterment of your fellow citizens.  Volunteering is good for the soul and also can open up opportunities for employment down the road.

As I look back on my 20’s, I see lots of financial mistakes, but I also see my successes.  I got a great education and learned a good trade (information management), I learned what NOT to do, I learned how to budget, I learned the importance of giving, the bulk of my debt is student loans, and more.  In life, you have to take the good with the bad, but if you learn from your mistakes (or even better yet, learn from those who have gone before you), you can get a jump on your peers (some who are even non-ADDers!).

Now, you might be thinking, ‘well, I’m passed my 20’s, so there is no hope‘, but the next installment will be on managing your money for your 30’s.  But if you are still in your 20’s, then try a few of these things listed above and see your financial life improve.

Don’t Be Blinded By The Symptoms Of A Financial Problem

SymptomsI was thinking today about debt and saw an article in my local paper about debt and how to tame the beast.  It is something that I think about regularly (when in debt, who doesn’t think about it?) but I know that, because I have ADD, my problem with debt might not be the same as those without ADHD.  True, the consequences of debt are the same: reduced disposable income that can be used for needs and wants due to debt payments, paying interest fees to lenders instead of investing the money yourself, and general life stress.  While the symptoms of debt are the same, the root cause of the debt is different — at least in my experience….and it might be for you too.

Remember, We Are Different Than Non-ADDers

For me, the accumulation of debt is not out-of-control spending, lack of planning, disorganization, credit card misuse, or making foolish investments.  Instead, my problem is on the revenue side of the equation — I struggle to get and maintain enough work to fund my life and cover my expenses.  So, you can probably imagine where this is going.  If I don’t have enough income to meet my needs (which are relatively modest), I need to make it up somehow.  And that somehow is debt.  I hate it, but it is true.  No point beating around the bush.

Look At The Whole Financial Picture To Find The Core Problem

The reason why I tell you this is to illustrate that it is very easy to become focused (hyper-focused even!) on the wrong things — that which commonly afflicts the non-ADDer population — like overspending, poor decisions, and poor financial organization skills, while the real problem (income generation) goes undiagnosed.  Make sure to step back and look at the whole picture before diagnosing your financial afflictions.  If in doubt, ask a trusted friend or relative to help you identify the root cause of your financial problems — you might be surprised by what they find.  Once you have properly identified your main financial roadblock to financial success, you can develop a game plan and get the help you need to reach your goal.

 

Being Grateful For What You Have (If You Have ADHD)

ThanksgivingSome days I get really down in the dumps because I think of all the stuff I do not have: a nice car, my own condo, perfect health, a life partner, a solid job, fancy toys and gadgets, fancy food, or being able to travel.  It can be tough sometimes.  Life is not fair, and I did not ask to have ADD.  It has made my life tougher and I have progressed much slower in life than my peers.  But it is not all bad for me.

I Am Fortunate

As time goes by and I learn more about the world around me and how much harder others have it, I am becoming more aware of what I do have….and just how fortunate I really am.  I have a roof over my head and a warm bed to sleep in at night.  I have enough food to eat and even get to eat out once in awhile.  I have nice comfortable clothes to wear and keep me warm in the winter.  I have good shoes to wear.  I have a job that I am doing well at and keeps my self-esteem intact.  I have a car to drive.  I have family and friends.  I have a son.  I can read and write.  I have relatively good health.  I live in a safe country.  I have some creature comforts.  As I get older, I realize just how lucky I was in the lottery of life.  Yes, my ADD causes me problems in my life and sometimes I struggle to keep going.  I sometimes wonder if I will have enough money to keep myself afloat and provide for my son.  But I have such a huge advantage of being born into a life of privilege, that I can’t help but be grateful for my good fortune.  I could have been born into a much crueller, harsher, and nastier life, but I was not.  And for that I am grateful.

Life Application

I might have ADD, but my life isn’t so bad after all.  And I hope you stop and think about this when you encounter challenges in your ADHD life.  We are so blessed.  Take heart, you have most of what you need.  A new car or a fancy house will not significantly improve your ADHD life.  You have already ‘made it’ in the rat race.  Count your blessings and your wants will fade into the background — and you will be happier for it.

Happy Thanksgiving Season!

Never Lose Hope

I have often struggled with depression and feeling hopeless.  The challenges of having ADD sometimes seem overwhelming.  Looking for work, having to make do with underemployment for almost a year, still having the occasional work hiccup, and draining my savings, has, well, made me feel drained.  Why do things take so long to get better and improve?  Will it ever improve?

It is at times like these that I remember God is with me and that I can trust him and his plans.  The plans often do not unfold as I would have them unfold, but they always seem to work out one way or another.  When I have struggled to find work, a job has been provided.  When I have struggled to make ends meet, someone has helped me out to boost my income or reduce my expenses.  Maybe I learn how to shop smarter, or how to cut an expense without losing the quality of the service/product.  But a window always opens when a door closes, or when all the doors are closing. 

I found that for those windows to open though, I have to trust things will work out, put in my effort, and wait…..patiently.  Not just sitting on the couch, but working steadily while waiting for that window to open.  This week I learned that a window might be opening.  At the non-profit organization I volunteer at, I learned they really like my work and that they are open to exploring how I could get funded to do my work as an employee of the organization.  And this just blew me away…..I was just volunteering to keep my skills sharp, gain experience, and help out my favourite charity.  It is through steadily working and not getting discouraged that this window is opening.  The journey is by no means over, but I have a spring in my step and renewed hope.  But I had to have hope and an attitude of ‘I can do this’, even when it seemed impossible.

So, the next time(s) you get discouraged and feel like everything is hopeless, remember, just keep on truckin’ along.  Eventually something positive will happen and an opportunity will materialize itself.  You can do it!!

Do You Have Good Debt, Bad Debt, Or Ugly Debt?

image

I have discovered that there are three types of debt in life, and they are not what you think they are.  They are not investment debt, not consumer debt, and they are not mortgage debt. They are: good debt, bad debt, and ugly debt.

Good Debt??  What??

Some will say that all debt is bad and it is hard not to agree with them.  Look around you.  How many of your family and friends are struggling with debt?  How much more so do you struggle with debt payments?  Debt can be good if it meets two criteria: you are able to make the payments and it is an appreciating asset.  Items such as a house, an education, or a business loan to start / expand a business are all examples of ‘good’ debt.  The reason why it is okay is because it is an investment in your future and will gain value over time (usually many times the initial investment).  A house provides a place to live, a source of income when you sell it in your senior years, and appreciates significantly over the life of your ownership.  An education enables you to get a good, well paying job you will enjoy doing for the bulk of your life.  You will make significantly more over your lifetime by getting a good education.  A business loan to start / expand your business often reaps good financial rewards.  But, like all debt, one must be careful to make an informed and thoughtful decision after much analysis and input from trustworthy advisors (friends/family and professional alike).

The Kind of Debt That Is Bad

And then there is bad debt, which is consumer debt.  This debt comes from your expenses exceeding your income.  It typically involves money that was spent on fleeting and temporary things / experiences.  Things like going to movies, vacations, a new car, a new phone, a new tv, eating out, etc. fall into this category.  You end up paying for these items/experiences long after they are gone.  This is why this kind of debt is so bad, because it robs you of your financial future and causes one to become depressed over time because the balance usually continues to grow (either through extra spending or compounding interest).  Often it takes the form of credit card debt or lines of credit.  The banks love you for racking this up and will encourage you to continue doing it any way they can (remember: the bank is NOT your friend).  Don’t fall for it.  Live within your means and your future self will love you for it.

Now, you might be thinking, I couldn’t help it!  It’s not my fault I lost my job (layoffs, termination due to ADD/ADHD impacting your work performance, illness, disability, etc.).  I know exactly what you mean and exactly how you feel.  This sucks when it happens.  But, like everything in life, we have to figure it out.  Consult with our family and friends (people you trust).  Develop a strategy to reduce your expenses and live within your means.  Find new work.  Rebuild your life.  It can be done but it will take time and effort.  You can do it!  I know you can.  The important thing is to be moving forward every month (having that net worth go up) instead of moving backwards.  In the future, try to avoid this debt if at all possible. Start an emergency fund to help minimize the risk of a financial catastrophe wrecking your finances.

Ok, What About This Ugly Debt?

This is where things get ugly (pun intended).  This debt involves money owed to family and friends.  Ohhhhh, you say.  Yeah, that type of debt.  This is the type of debt that strains/damages family relationships and destroys friendships.  See, if you owe money to the bank, who really cares if you don’t pay them back right away or even at all (think bankruptcy)?  But if you do not repay your family and friends within a reasonable time-frame or not at all, they are going to be upset.  Upset that you do not care enough about them and your friendship/relationship to pay them back.  And then things can turn really ugly, really fast.  AVOID THIS DEBT LIKE THE PLAGUE!!  This type of debt doesn’t just hurt you and the other person, it also can have rippling effects throughout a family and a circles of friends.  It corrodes trust and social capital, two very important things in life.

Ok, so what if I’m truly desperate for money and no bank will lend to me?  Well, then you can consider this option, but only after much thought and deliberation.  My Advice?  This must, must, MUST be a last resort to borrow from.  This is when you get so desperate you have no food (ie. you are eating dirt) and are going to lose your house / get evicted (you are drawing up architectural plans of your new cardboard box home for living on the streets) because you are so broke.  Stay clear of this debt if at all possible though.

How Do I Get Rid Of My Debt??  I Hate It!!

I hate my debt too.  The only way to get rid of your debt is to consistently spend less than you make, month after month.  It is hard, and sometimes you want to give up, but it is worth it in the end.  If your job sucks and you will never make enough to live a decent life (more than a cardboard box and eating dirt), consider exploring using Good Debt to help you achieve your career goals (get a better education).  Just make sure to plan it out, ask for advice, and borrow wisely.  And then when you finish your schooling, pay that debt down as fast as you can.

If you have ugly debt and have room on a line of credit, consider transferring the debt amount from ugly debt to bad debt. Better to be a slave to your bank than damage your precious family relationships and/or friendships. The latter is infinitely more valuable than the former. Take steps today to rebuild your social capital and improve your life.

Take Action: Do you have ugly debt? Figure out ways to eliminate this debt or at least set up a payment plan to pay your family / friends back. You will be glad you did.

 

Strategy to Control ADD Impulse Spending at the Farmer’s Market

Farmer's Market

A long, long time ago in a city far away…..

Ok, so I kinda like Star Wars….but this is a true story.  It just doesn’t have light-sabers like Anakin has…..but it has shiny things in it…..and I know ADDers love shiny things!

“Oooh, look at that!  I love the idea of fresh corn.”

“Oh, and organic cheese, and organic bread”

“And oh, and local honey, and blueberries!”

“Look at all these neat hand-woven bags.  I just have to buy one!  Hmm, how about two?”

This was a conversation I regularly had with my (now) ex-wife a few years ago when we went to the farmer’s market every week.  We lived in a city that was surrounded by prime agricultural land and we were diehard foodies/farmer’s market groupies.  But we spent (and sadly wasted) so much money at the market.  Not that the food was bad or that it wasn’t worth it — it was worth it.  But we tended to throw food out because we bought too much, didn’t keep track of the money we spent there, bought things we didn’t really need, and, well, frankly we just went overboard.  It helped contribute to our food budget ballooning to over $1000 / month for 2.5 people (two adults and a 1-year-old child).  Talk about crazy.

Fast forward 6 years and I am on my own now.  Just me, myself, and I.  And, after taking a break from the farmer’s market scene, I decided to return, but with a new strategy to maximize my enjoyment while keeping a lid on my wallet.  So I went to the market today with my now 7-year-old son and began by explaining to him that we will look at all the vendors’ tents before we buy anything.  “Sure daddy!” he said.  Now, before we entered the market, I put a $20 bill into my wallet and my son had $5 in his.  The experiment seemed easy enough….

But the food looked so good, and the samples were delicious!  And, my son being a 7-year-old, was eager to plead his case for all the tasty stuff he saw and sampled.  Over and over I reminded him that we need to see all the market has to offer before we buy anything.  At the second vendor’s tent, my son stopped and looked at the jewelry and bead-making stuff.  Oddly enough, my son has taken an interest in necklaces and all that stuff over the last week — don’t ask me why, I don’t know why, lol.  But I politely looked at the merchandise with him and saw that it was $5 for a bag of beads and string to make a necklace.  I then shepherded him along to the next tent and then explained to him that I could buy him way more than that for a fraction of the cost.  He was like, “really?”  Hey, maybe I was teaching him something useful?!  That’s cool…..

We did visit all the tents and tasted some awesome food, but I kept reminding him that we need to wait until we have seen everything before deciding on what to spend our money on.  It wasn’t easy though.  But as we were going around the market, I learned a few things:

– Some vendors sold the same things, so I could price compare the items.

– I spent more time asking questions and talking to the vendors instead of worrying about making change and buying stuff.  I learned more about the products as a result and used this to make better purchasing decisions.

– I enjoyed the farmer’s market experience so much more because I didn’t feel like I had to buy anything.  I was just browsing, thus putting me in the driver’s seat of the shopping process and not in the reactive position (buying just because that’s what everyone else does and what I’ve always done).

– The more tents I visited, the more my willpower grew to resist spending money.

– I didn’t get sucked into the ‘market buying experience’.  You know, when you get all excited about your purchases and it just seems easier and easier to keep buying things…..(I’m not sure why this happens, but it does, at least in my experience)

– When I finally did decide on what I wanted to purchase, I had the comfort of knowing that I knew all there was to buy and had all the information to make the best purchasing decisions.  It removed buyers remorse.  I was also more confident in my purchasing decisions.

– If I was really interested in the product but didn’t want to buy it just then, I asked for a business card and asked when they would be coming back to the market (so I could delay my purchasing decision while retaining the contact/product information as a reminder to myself).

By limiting the amount of money I brought with me, taking the time to visit all the vendor tents first before spending any money, and having time to think about what I really wanted, I only ended up spending about $10.50!!  Now how cool is that?  I got my dopamine hit from my purchases (the pleasure chemical in the brain), only spent half my money, had a fun time, and taught my son something useful…..Not bad for an ADD impulsive guy.  The next time you are out shopping at your local farmer’s market, flea market, bazaar, multi-family garage sale, or mall, try this strategy and see what kind of results you get.  Happy guilt-free shopping!

Oh, and my son did decide to spend his entire $5 on his bead set…….sigh, I can rein in my impulsive shopping but not his apparently.  Oh well, he has lots of time to learn as he grows up.

 

Who Should Control The Money In An ADHD Marriage?

Competition

In the first part of our three-part mini-series on money management last week we explored the question of which is the best option for managing the assets and debts a couple has (shared or separate?). We showed that finances are jointly owned (assets and debts) whether you like it or not, so you might as well work together on it.

In Part 2 this week, I want to look at how couples can successfully structure their financial affairs (especially if one of the partners has ADHD) so they don’t kill each other (and hopefully have success!). Money arguments happen frequently in marriages / relationships due to conflicting priorities, different spending habits / preferences, differing money philosophies, and struggles for control and power, and this sucks. Who likes fighting about money? Not me, and I’m sure you don’t either. So how can we fix this situation? How can we have more financial harmony? And have more financial success too? Let’s take a look.

The Three Models of Managing One’s Finances

There are three main ways of arranging a couple’s finances: separate accounts, joint accounts, and the hybrid model (his/hers/ours). The first option involves the couples holding separate accounts in which their respective paycheques go into. The couple divvies up the bills and each partner pays the bills they are responsible for. This option works best if both are employed, have significant assets/debts, are on their second or subsequent marriage, and value their financial independence.

The second option is where couples pool all their finances together into one main account and pay bills from this main account. This model is often chosen by first-time marriage partners and younger partners since they do not bring significant assets to the marriage. This arrangement requires good communication skills between the partners and involves a high degree to trust.

The third option is the hybrid (mixed) model of family finances. It involves three accounts (his/her/ours) and can be set up in two main ways. First, all the income can go into the joint account (ours) and then the bills are paid from this account. After which, a small portion is transferred from the main account into the his and hers spending accounts, which each partner has full discretion over the use of the funds in their accounts (with no accountability to their partner for how they spend the funds). The second way the finances can be arranged is that each partner’s income is deposited into their respective his/hers account and then some of the money is transferred to the joint account where all the bills are paid from. The bills are split equally or based on a percentage of the partner’s income.

Which Method Is Best?

There is no one best method for how a couple arranges their finances. For some couples, the joint model works, for others the hybrid model works, and for others having separate accounts works best. And it might even change over time based upon circumstances. I have one friend who was working in another province and he was given a monthly allotment for his needs (room and board, gas, food) while the bulk of his paycheque went to his family back home. A couple might start off with separate accounts and then find that once they have kids, the joint model works. Maybe a couple earns more money than they used to and now find they are fighting about how to spend the extra income, so the hybrid model might work best. Or maybe a couple starts their second marriage with the idea to use the separate finances but then decides on the hybrid model because it works better and their trust level improves.

Who Will Manage The Joint Account and All The Bill Paying?

If the couple chooses the joint or hybrid model, how should they decide who will manage the household finances? Should it be the non-ADDer? The ADDer? No, that would be crazy, right? Well, maybe not. You see, both ADDers and non-ADDers are equally at risk of poor money management skills. Nobody is perfect and everyone is different. Remember, there is no one method of money management, including who will be paying the bills. So, how do you decide?

Start by having a look at each partner’s expense statements and see who wastes more money. Is one clearly better at restraining their spending and paying their bills on time? If so, should this qualify the partner to manage the money? Maybe. But do they even like doing it? Interest in bookkeeping is another factor to consider. Basically, it comes down to capability and interest. If one of the partners is more interested AND is capable, then let them do it.

But! But! But! What if I have ADD and my partner doesn’t and they want to control all the money? Won’t this shut me out of managing the family finances? Don’t I get a say? As we will see next week, the answer is no, you will not get shut out.  Next week’s article (Part 3) will dig into how to build a plan for managing a couple’s finances that works for both partners.

 

To Share or Not To Share, That Is The Question

coin piles

It’s funny.  The other day I thought I would ask a simple question in a few ADHD groups online about how people divide or share their financial resources and responsibilities as a couple.  What I got was a huge response from fellow ADDers.  The opinions varied considerably, from pooling everything together to totally separating finances, and with money management duties being shared equally to each individual doing their own bills. Some non-ADD spouses even let their partner do the bill paying, even if they have ADHD!  It seems there is so much variation in how money is earned, shared, split, managed, and spent.  So what did I learn from my little research project?  Lots.

Three Models Of Arranging Finances But Really Only Two Options

Couples usually choose one of three main models of arranging their finances.  The first model is to keep finances totally separate (I’ll pay my bills, you pay yours) and investments and spending accounts are totally separate.  Bills are usually split half-and-half or on a percentage basis and are paid separately.  The second model involves joining finances completely and putting all money into one ‘pot of money’ and pulling out money from the pot for all the main transactions a couple conducts, including investments and savings.  The third model takes a hybrid approach, whereby a couple uses three main accounts (his, hers, and a joint account).  In this arrangement, the couple puts all their money into the joint account and pays all the bills through this account.  A set amount each month is transferred from the joint account to the ‘his’ and ‘hers’ spending accounts so that each couple can spend some of the money as they please.

In the end though, there are only two real money sharing options: shared or separate.  A couple either shares in all the joys and risk together, or they remain separate in how they handle their finances.  But even if couples keep their money separate, legally all assets and debts they accumulate within the marriage are shared 50/50, regardless of whose name they are in.

So, this begs the question, why do some couples keep their finances separate while some pool it together into one big pot?  And how does ADD/ADHD in the picture change things?  These are very interesting questions indeed.  Let’s explore them.

Why Some Couples Share Money And Others Don’t

Each couple decides what works best for them, even if it is not a 100% satisfactory solution.  Here is a quick summary of why some people join their finances and some keep them separate:

Joint Finances

  • Benefits:
    • Low income = Joint pot of money means synergy (two are better than one philosophy)
    • JF is about being one and building a life together
    • JF can be a proclamation to your partner that you have nothing to hide from one another (builds trust)
    • Less overspending occurs since both are working together as a team and are accountable to each other for their spending
    • It puts the ‘team’ before ‘me’
  • Drawbacks:
    • JF can increase the stress/fear of breaking the bank with impulsive spending by ADDer or even the non-ADDer
    • JF requires good communication and if lacking, can cause much relationship stress

Separate Finances

  • Benefits:
    • It is meant to hedge against the risk of divorce’s impacts
    • Provides more control and autonomy over one’s finances
    • Can eliminate money fights
    • Can protect the ‘good’ partner from the reckless one’s actions (especially if you divorce)
    • Can protect one’s credit from being damaged by their partner
    • Can be a way to protect one’s kids (in step-families) and provide for them first
    • Good if one partner has debts and the other does not
    • Can be a way of protecting the family finances (to minimize impulsive spending by one partner)
    • Can greatly reduce the friction between fundamentally different money philosophies by the partners
  • Drawbacks:
    • Can lower the level of trust in a relationship and reflect a lack of trust in their partners
    • Accentuates the disparity in power in a relationship since the wealthier person can say no and deny access to funds for family needs while the poorer spouse cannot exert influence/power as a member of the financial team.
    • Often pits one spouse against the other and can be used as a tool against the other person
    • Problems can arise when one spouse makes more than the other
    • Separating finances can depress and distance/isolate one spouse
    • Shows that a couple cannot fundamentally agree on how the family funds should be spent

What Is The Best Method?

When one looks at the lists, it is hard to really come up with a ‘best practices’ guideline to follow  for arranging a couple’s finances.  But I believe the principle of teamwork should take precedence over personal autonomy.  If you are married, should you not want to work together as a team to build a prosperous and bright future together?  If you want to keep your finances totally separate, then why are you in this relationship at all?  One ADDer said it best when they said, “If you don’t feel like you can pool your money together with the man or woman you are marrying, then please don’t get married….”  Makes sense to me.  Even the courts agree with this philosophy!  Merging your finances is the best option….even if you have ADD/ADHD (we will talk about how to actually arrange your finances as a couple, so you don’t kill each other, in our next blog post).