Scott and Bethany Palmer have been financial advisers for more than 20 years and they’ve turned their focus to relationships and money, even developing a set of money personalities that we each have. They argue that knowing your partner’s and your own money personality can save a lot of distress and miscommunication in the future – as well as set you up for a healthy financial future.
So, if you’ve always wondered why it was hard to talk money with the person you love the most, then get Charged up! about our Valentine’s Day special episode – learning yours and your loved one’s money personality!
JennyHoff: Bethany and Scott, thank you so much for joining me today.
Scott Palmer: Oh, our pleasure.
Bethany Palmer: It’s great to be here.
Hoff: So I think Valentine’s Day is a good time to talk about love of course, but also how our financial viewpoints can affect it. You wrote a book “The Five Money Personalities: Speaking the Same Love and Money Language.” I can’t wait to delve into your insights, but first I want to talk about your own history with money and how you guys ended up joining forces to be the money couple.
Scott: Yeah, absolutely. So Bethany and I have done over, oh, goodness, I think we’ve both been in the financial planning industry for over 27 years. And so we came at the money side like most, but then you throw the fact that we’re a couple and that we have to deal with our own finances and communicate.
And we actually kind of have a crazy situation where we have a couple in that we were working with their finances and they were very well to do, college planning was done, the house was almost paid off, they were in no debt.
I mean, all those boxes were checked, and they were all really positive. And they came in and as we were viewing things there was just so much tension in the room, like you wouldn’t believe it. And so we look at each other, Bethany and I are looking at each like, “What’s going on?”
So finally I just said, “Are you guys OK? What’s going on?” And she said, “Actually we’re getting divorced and we really need your help splitting up these assets and telling us how to work this out.”
Hoff: Oh, wow.
Scott: And so after Bethany and I pulled our jobs off the table, because that was the last thing we were expecting out of this table. We spent the next 20 or 30 minutes doing that, and at the end of the conversation I just said, “I just have to ask this question – why are you getting divorced?” Because in my mind I was naturally going to, oh, who’s got the addiction? Who cheated on who? What happened?
And they said, “Well, it’s the money. We just can’t get along about the money.” And I’m looking at their portfolio going, “You have plenty of money.”
Bethany: It was just crazy. And one of the things that we always think is if you have a lot of money then you’re not going to argue about money.
Bethany: And that really set us on a journey to say, “What is going on here? Why aren’t couples agreeing about money?” And we dug in a little bit more and we’ve discovered that 70% of divorces are over money.
And then we dug a little bit more to say, “Why is that? What’s going on?” And we discovered that it doesn’t matter if you make $30,000 a year or $3 million a year, couples are arguing about money all over the place and it’s because they view money differently – money impacts just about every decision that we make, and whether we like it or not.
This morning I went to go put gas in my car and I had to decide do I want high-grade or mid-grade or low-grade. There’s a money component to that.
Our kids went up to school, and were they going to have hot lunch or were we going to brown bag them for them? We go for lunch, are we going to go out to lunch or are we going to just bring it in? There’s just a money component to just about every decision, and the challenge is that couples don’t see eye to eye on those little every day money decisions and that’s what’s tearing our relationships apart is because they don’t have a way or a method to be able to see eye to eye when it comes to money.
Hoff: Absolutely, and it’s interesting because we hear about love languages a lot, and do you speak the same love language? Do you show your love in the same way? And that can really disrupt a couple’s communication styles if it’s radically different.
And so you guys have the five money personalities, how did you guys come up with these five money personalities, and can you describe each one for us?
Scott: Yeah, absolutely. So, when let me just kind of tell you how we came up with them, because basically what happened was when Bethany and I had this experience with that couple, that night we were at home and we were just like, “What happened there?”
And we try to go out at first and try to find resources or try to find a way to pinpoint this, and we couldn’t find anything. So what we started doing was we started interviewing any couple that would talk to us about their money. We just started interviewing; we started talking to our clients.
And what we did was we started compiling all of this data, and we actually gave it to a statistical scientist from Stanford. And, he basically compiled this data that we had and that’s where the five money personalities was created. And then what we basically did was we put it into an assessment.
So you can actually go to themoneycouple.com, and take this assessment, it takes about eight minutes to take. And it very specifically gives you your primary money personality and then your secondary money personality as well.
Bethany: And what we found, and the reason that we did this was because we were seeing couples have these differences but we didn’t have a label for the differences. And it’s really hard to figure out how to get along about money if you don’t have a way to label your differences.
And then it was funny, before we had the assessment made we would go to speak about couple and differences and the many personalities and things, but then couple would be arguing about what each other’s money personalities were. And we’re like, “You got to be kidding me. All right, let’s put an assessment together to take at least that argument off the table.”
So it really has been great. And one of the things Scott said is he said, “It identifies your primary and your secondary.” A lot of people just go, “Oh, yeah, well, I’m a saver.” Well, OK, but what happens if your secondary is a spender?
Bethany: So you are a primary saver, secondary spender.
Hoff: That’s me. You guys, this is funny.
Bethany: There you go. That’s confusing to be managed to. Because on one hand you want to save money all the time, but on the other hand you want to give gifts to everybody or whatever your situation is, who you are. So the secondary is so absolutely crucial to combine with your primary to be able to understand your quadrants if you will of your four money personalities between both of you.
Scott: It’s interesting, we’ve had just really organically people coming to our website, we’ve had over 125,000 people take this assessment so far.
Hoff: Oh, wow.
Scott: And what we’re finding with the couples, we’re finding that 80% of couples have what we call an opposite dynamic in their relationship. And the opposite dynamic is for instance Bethany and I are both primary spenders, so when it comes to spending money we don’t really have a lot of friction in our relationship.
Bethany: Yeah, we love to give gifts.
Scott: We’re gift givers. But secondarily she’s a risk taker and I’m what we call a security seeker. So Bethany’s willing to take risks, I on the other hand I have to have a plan for everything, like when we go on vacation I’m dialed in, there is a plan for everything. You can ask me any password for our life insurance, our credit card numbers, anything; I’ve got all that stuff memorized because I have to have a plan.
So, in our relationship she was always wanting to go out there and taking risks, and I was the no guy in the relationship. Everything was no all the time.
Bethany: Yeah, so I had this idea like let’s buy the piece of land or something like that, and he’d be like, “No.” And after a while what happened is that I stopped sharing my ideas because I don’t want to hear no all the time, so I don’t share ideas, I just keep them in my head or talk to a friend about them or whatever.
And that’s what starts tearing the relationship apart and you start drifting away, because I’m not sharing with him big part of who I am, and that part is all shut off and you don’t even know why. It’s just kind of this natural thing.
And after a while I don’t want to hear no so I just don’t do it. It’s not that I’m being mean or I’m trying to withhold things from him or something, it’s just that I don’t want to hear no.
Hoff: Right, you don’t want to hear no and had to cause conflict there.
Scott: Right. And that’s what happened in so many relationships and that’s what we’re seeing in relationships is once again – what is the number one reason for divorce? It’s money. How many money decisions do we make in a day? Probably 30 or 40. So if money is already the number one stressor in relationships, and the 30 or 40 decisions that we’re making about money our significant other doesn’t agree with, no wonder it’s the number one cause of divorces.
Scott: It’s not rocket science here. So part of the reason that we created these money personalities was because we wanted people to be able to quickly idenstify the differences in their relationships, and then be able to understand the other person. I’m big in just situation and Bethany is big in the self-evaluation, and that you can’t be good for somebody else unless you know who you are.
But once you know who you are and you understand who they are good, then it gives you that kind of AHA moment where you go, “You know what? You’re not crazy. I think you’re still partially crazy, but you’re not completely crazy when it comes to money. You’re just acting the way that you are.”
Scott: And it’s interesting with these money personalities because you brought it up a little bit earlier in our conversation, you said, “I’ll be interested in knowing how these money personalities evolve.” And we believe that money personalities don’t evolve, you are born a specific way, your money personalities are your DNA, it’s who you are.
And although like Bethany and I are primary spenders, and we’ve learned not to just throw caution to the wind and spend money all the time, we do save for retirement, we have life insurance, we’ve done all that important financial planning stuff. We’ve both been spenders since we could walk. And where we proved this was with some case studies with kids and Halloween candy.
And what we did was we observed and we had a huge group of our friends observe their kids with their Halloween candy and how they either consumed it, they saved it, they traded it, they had a plan with it or they gave it away.
And what we found was that even as parents we can try to influence our kids to how we think they should be, but the reality is they have their own money personalities. And being able to speak into your kid’s money personalities is also important.
So these money personalities in a lot of ways kind of rule the world, and definitely rule our relationships not only with our spouses but also with our kids, and our parents, and our grandkids.
Hoff: Right, all of our relatives and friends. So I want to jump into what these five money personalities are, and what are their main characteristics.
Bethany: Sure. What I’ll do is quickly go through them, but I just cannot stress how important it is is the combination of the two. And if you think about it, so there’s five money personalities, but there’s actually 20 combinations. So a lot of times what people do is they try to make things super simple and just focus on their first one but they can’t.
So the first one is the saver, that’s the person who saves, saves, saves, and an interesting thing about savers is they don’t want to just save for themselves, but they want other people to save too.
So for example you go out with someone and they’re talking all about this good deal that you can get on let’s say camping equipment or something. They I want you to get that good deal too; it’s not just them, so savers are all about saving.
Spenders are all about spending, they love to spend money on themselves. But they also are huge gift givers.
Scott: You know those people that you say don’t bring a gift to the party and they bring a gift anyway?
Bethany: So they’re spenders.
Scott: That’s your spender right there.
Bethany: That’s your spender right there. So, saver, spender. The next one is the risk taker. These are the entrepreneurs of the world. They always have a new idea, this new deal that they want to get into, that again, the entrepreneurs of the world.
The next one is a security seeker. Those are the planners, huge planners, they seek security. That security is in that plan, which is different than a saver. A saver just wants to save money; a security seeker wants a plan.
And the last one is what we call the flyer. They are people who fly by the seat of their pants when it comes to money. Money isn’t the first thing that comes to mind in a decision, relationships are, so they really are honed in on relationships.
So you can have this combination. You can be a saver-flyer, so you like to save money but at the same time relationships are the most important.
Scott: I think a great example of a difference, so I’ve got what we call the opposite dynamic, in that I’m a primary spender but I’m also a security seeker. So this is how it plays out in me and how other people with opposite dynamics are confusing.
When Beth and I go out shopping I’m all into it. I mean, I love it. I’m having a blast. We’re spending money, we’re hanging out together, it’s fun. Then on the way home I talk myself out of every purchase I just made, especially if it wasn’t in the plan.
Bethany: If it wasn’t in the plan.
Scott: So I am not kidding you, I probably return half of the things that I buy. That is because it didn’t match up with my security seeker.
So it can be really confusing, and now that I know and understand my money personality I look back and think, “Man, I suck the joy out of shopping with Bethany for like the first 10 years of our marriage,” because on the way home I’d be like, “Oh, my gosh, how much money did we spend? That wasn’t part of our long term plan. What was I thinking?”
And it was confusing for her, because she was like, “What the heck? We just had a great day and you were fine, and then on the way home you’re freaking out.” So that’s why the opposite dynamic and why we stress so much that you have to understand not only your primary, but your secondary money personality.
When it comes to a saver and a security seeker where the difference is, for instance, my boys and I ski on most weekends and we were coming down a large highway called the 70. It’s very steep and I had a blow out on my tire. Scared me to death. How we didn’t roll my Suburban? I have no idea.
So the next day I went to Discount Tire, and was shopping for tires. Now the saver would have had a Groupon, a saver would have said, “What’s the difference between a 50,000- or a 70,000-mile warranty? I’m just going to go with the cheapest.”
As a security seeker I got the most expensive Michelin tires made. They have a 70,000-mile warranty, they’re supposed to best threads for what we do going to the mountains. I didn’t look at the price. I just wanted the security of that tire, and the price wasn’t even on my radar.
So that’s the difference between a saver and a security seeker. Security seekers are always seeking that level of security, as where savers are really looking at saving.
Bethany: The bottom line.
Hoff: Just the cheapest deal basically.
Scott: You got it.
Hoff: So what at least primary personalities tend to work best together and which tend to clash the most?
Bethany: Well, it’s interesting, we have what we call the opposite dynamic, which we go into quite a bit of detail inside of our book “The Five Money Personalities.” But the short side of it is there’s five money personalities, two on one side of spectrum – saver and security seeker. The other side of the spectrum is risk taker, spender, and the flyer.
If you have one money personality on one side of the spectrum and another money personality on the other side of the spectrum, you have the opposite dynamic, meaning they clash.
And so, what we find toward the relationship, on one side of the coin if you will we’re attracted to our opposites, and money is no different. So in most relationships you’re going to have some opposite dynamic stuff going on, absolutely no problem. If you don’t identify it you will fight all the time.
We find that couples that have more similarities in terms of their money personalities, you don’t have as much clash. But should you get married or do not get married? I don’t think you can say that, because really it’s good in a relationship to have some opposites going on just simply so that’s just the spice of a relationship. I mean, that’s just given. You don’t want to be two totally the same people, that’s boring.
But at the same time if you do understand what your opposite dynamics are you’ll have less clash, less arguments about money.
It was interesting, we’re listening to a couple the other day and she said, “Why don’t you think that we argue about money? We like hardly ever argue about money?” Well, one a saver-security seeker, and the other one’s a security seeker-saver. So, they didn’t have all this saving and security seeker about them all inside of their relationship, so they don’t have a lot of class in there.
Now do they have a lot of adventure in their relationship? Not really, they need to work on that, because there’s nobody in the relationship that’s encouraging that.
So it’s like people ask us, “Is it OK for us to get married with our combination?” Yes, it is. If you love each other and you’re committed to each other and you understand your differences.
Hoff: So, again, that sort of kind of leads to my next question which is, OK, so you take this assessment on your site, you now know what your money personality is, what your partner’s money personality is. What do you do with that information now? What if you find out, okay, we’re totally opposite, this is the source of our conflict for our entire marriage or our entire relationship, what do you do with that information?
Bethany: Well, one of the things that we do is we have some systems that you go through and they’re written inside of our book. There’s three things, something called a money dump, a money huddle, and a fighting fair. And if you can do those three things and do them with understanding your money personality you’ll be fine.
I mean, we have just seen miraculous changes inside of relationships if you do those three strategies, those three ways of communicating and using your money personality inside of those three systems you will not have a problem.
Hoff: Can you briefly go through each one of those systems so we know what they are?
Bethany: Sure, the money dump is to be able to dump everything out on the table. One of the things that happens with money oftentimes especially after a while is we kind of keep our thoughts in our brains and we don’t dump the things that we think that are good with our money and our relationship, things that are bad inside of our relationship. We don’t just get an opportunity to be able to just get it all out there.
Scott: Yeah, and do it in a positive way.
Bethany: Right, exactly.
Scott: That it doesn’t tear you apart.
Scott: The goal with the money dump is to just get it all out and do it in a constructive and kind way. And Beth and I, we still do a money dump every year.
Bethany: Once a year, yes.
Scott: We’ve been doing the money couple for close to eight years, and we still do this money dump at the beginning of every year, because it just feels good to say, “Hey, what are we doing right? What are we doing wrong and what’s bugging us?”
Scott: And so we’ve got a very specific system to make sure that feelings aren’t hurt and it’s done in a constructive way.
Scott: So you definitely start with the money dump.
Bethany: The next one is the money huddle. Now the money huddle is something that you do once a month. And this is an opportunity for you to be able to get out your needs, your dreams; the things that you think are positives, negatives, and all that, that’s all about your money relationships.
It’s nothing to do with your finances in the sense of your budget, your retirement planning, your insurance planning, your estate planning. That’s financial planning issues and things that you need to talk about. We’re talking about your money relationship, the day to day money talk that you have.
So the money huddle takes about 45 minutes once a month, and it’s a whole system to be able to get the day to day money talk in a good position for you. Especially when you have these opposite dynamics, again there are so many opportunities for hurt that the money huddle really gives you that system to be able to get your money relationship on track.
Scott: Part of the greatness of this system that we’re doing is that we have put the cart before the horse in the financial planning world for the last 150 years, and that we naturally assumed, and this is what Bethany and I have found, and we’re financial advisers so we get it, that we assume that if you have no debt you’re going to have a better relationship. If you have the perfect retirement plan you’re going to have a better relationship. If your house is paid off you’re going to have a better relationship.
And what we found is that although those things help you can still have all those boxes checked and have a terrible relationship, because you don’t even agree about those decisions that you’re making with those specific area.
So what we have to do is we have to understand how we can actually compromise in a relationship, crazy word that none of us are very good at, how do we compromise, but how do we put the relationship first and then figure out all that other stuff and be on the same page?
And what we find by doing the money dump and the money huddle is that when you have a very specific times that you’re going to talk about money, that you’re going to address money, and that you’re going to address concerns, you stop bickering, you stop nitpicking, you stop fighting, because you know that you have a safe place once a month to sit down and say, “Hey, let’s really evaluate our money relationship.”
And once you understand that there is a difference between a money relationship and your finances and you can compartmentalize them, you can really start working on the love and money aspect of your relationship, and all the other stuff falls into place.
I mean, the reality is I can’t tell you how many thousands of couples that we’ve talked to that they’ve gotten out of debt but it was so driven by one person that it actually drove their relationship apart. Is that good? No, debt’s terrible. We’re not proponents of having debt, but the reality is that it takes you two years to get out of debt if you don’t take care of your relationship in the meantime, you get out of debt but you hate each other.
Scott: If you maybe take two and a half or three years and you get out of debt and you keep doing your date nights and you keep doing things that are important in your relationship, you’re out of debt a little bit later, but you have a great relationship so that you can even move forward faster together in the future.
Hoff: And divorce is very expensive, so to try to avoid that is a good idea.
Bethany: Yeah, no kidding.
Scott: No kidding.
Bethany: No kidding. One other thing I’ll just mention too, so we got the money dump, that’s big picture once a year, money huddle once a month. And then I’ll talk about the last one, and that’s one I just love, it’s called fighting fair.
And the truth of the matter is we’re two people, there’s going to be fighting going on. Let’s learn how to fight in a way that is going to bring us together and not tear us apart. And that’s what fighting fair is all about. So it’s once you feel like a money fight is coming on, it’s a whole system to be able to minimize the hurt that happens inside of fights.
Hoff: I want to quickly go through kind of some relationship conflicts that could be going on regarding money and kind of how you would use these systems to address those. Like for instance let’s say one person’s the total breadwinner in the family, the other person either is bringing a much less or they’re not bringing in anything at all, and there’s some resentment there for the person bringing it in.
I know many couples where the woman is bringing in a lot of the money and the husband may not be bringing as much. He may still be contributing for the kids and doing things with the kids, but there’s still this resentment there, what would you do to address this before it gets out of hand where the relationship no longer can be saved?
Bethany: You know what’s so interesting about that scenario? Is that you can have that same scenario but if you have different money personalities that scenario is going to play out different in that relationship. Let me give you an example.
You can have the breadwinner who is a saver-security seeker, OK? And then you have a person who is not bringing in as much money, they’re let’s say has been the risk taker. So the reason that the resentment is really happening is because this person is bringing in some of the money but they’re a saver-security seeker, and this other person is coming in and spending all this money, that’s where the conflict is. It isn’t necessarily because they’re bringing in all the money where all the resentment is.
Now if you’ve got the kind of relationship where there is resentment simply because you’re bringing in more money than the other, and all that. Well, then there might be a scenario where that’s not a good relationship. I mean, that might be true. But really looking at what’s going on in terms of the money personalities in that scenario is key, and they have got to get that out, they have got to talk about that.
And if they think, if this breadwinner person thinks that this other person isn’t bringing in enough money and they’re lazy let’s say, that they’re just being lazy. Well, then there are so many more issues other than just money going on there, that doesn’t have anything to do with money.
Bethany: So it’s really interesting. You’ve got to identify what the foundational resentment is coming from, not necessarily what the actual numbers are.
Scott: We talk a lot about in our book and in our studies that in some situations you might have somebody that just loves to control the money. And we don’t have a lot of time to go into that, but the reality is that some people whether you’re the breadwinner or you’re not the breadwinner just have control.
And so we talk a lot about what we call financial infidelity, which is we’ll do another whole podcast with you on financial infidelity. I tried to trademark that about 10 years ago and had no luck. But we got financial infidelity that’s kind of running rampant in a lot of our relationships.
Bethany: Which is lying, cheating.
Scott: Lying, cheating, hoarding issues with money. And so lot of times what we’re seeing with couples too is that after years of resentment that’s build up, we have this financial infidelity.
So part of what Bethany and I are so excited about is that we think, well, we don’t think, we know, we have a system that can help couples if they had been married for two months or 50 years, and that it just lets them step back, do that self-evaluation that we talked about, be able to evaluate their spouse, and then move forward on a financial front.
And you know what? It’s fun. I think part of what we’ve done in the financial planning world is we’ve made it so guilt-driven and we did it so you’re right, I’m wrong. Well, that’s not true, you’re just different. It’s like Bethany’s not wrong for having red hair and I’m not wrong for having almost no hair. It’s just who we are.
And if we can get back to the point where we can say, “Hey, we’ve got a fun, engaged way of really figuring out why we’re struggling. Now we can move forward together. We can fix it, because it is fixable.” I don’t think there’s any relationship in the world that can’t be fixed if you want it to be fixed.
Now we’re going in with this amazing bit of information, now we understand our kids, we understand our parents, we understand why we do weird things with money every once in a while. Now we get it. Now we can move forward and we’ve got specific systems for talking about money, for talking about financial infidelity.
Hoff: Yeah, what are three steps that somebody listening to this right now can take starting today to get their relationship on sound financial footing with each other?
Scott: Absolutely. First thing is take that money personality assessment. That is going to rock your world. The second thing is have your significant other take the money personality assessment, because you are 90 percent of the way there by understanding who you are, by understanding who your spouse is.
And then we have a really unique system that’s called the money and me blueprint. And what it does is it’s a 17-page document that you can get right after you take the assessment, which is going to show you where you are, where you’re bumping up against each other, and how you can move forward.
So we get very specific in that, “Oh, you’re married to this person. Or you’re with this person, here’s what you have to think about and here’s what you have to keep in mind.”
Hoff: All right, and then finally our show is called Charged Up, what gets you charged up about saving relationships through resolving these financial difficulties?
Scott: We believe that by people understanding who their money personalities are we can drop the divorce rate in America by 10 percent.
Bethany: 10 percent, yep.
Scott: If 70 pecent of marriages are ending over money, and we have people actually for the first time talking and moving forward together and understanding and learning how to love each other again, we can drop that divorce rate. So our big hairy, audacious goal, what gets us up every morning is dropping that divorce rate by 10 percent.
Hoff: Fantastic. It was a pleasure speaking with both of you. I think this conversation could have gone on much longer. You have a lot of interesting information. I highly encourage people to check out your book, check out your website – themoneycouple.com. And I really appreciate it.
Scott: Absolutely our pleasure.
Bethany: Absolutely. It was great to be with you.
See related: Charged Up! podcast: Love and Money