Couples often disagree on financial matters. Opposites attract when falling in love, but we somehow assume that consensus will be magically achieved after marriage. However well they may bond over the years, a couple tends to remain their own people in many respects. Money personality is one such trait, shaped by their own beliefs and experiences, and not necessarily modified by marriage. There is more secrecy, denial and lack of accountability in household finances than we may care to admit.One spouse holding power over the finances of the household is not the solution. It is easy if there is no debate or discussion about every decision. But this centralisation is not a source of peace and calm with respect to household financial decisions. There is either oppression or periodic rebellion, both harmful. There is a lack of accountability and transparency, leading to inefficient outcomes for everyone. Couples tide over these with time, seeing the differences as necessary compromise, mostly avoiding confrontation after they have understood the patterns of behaviour around money. Resentment remains, and the blame game continues.Avoid ad hocism in spendingWithout a clear definition of priority and discretion, many households suffer from ad hocism. How should they spend for the common good without sustained disagreement? How much is available to spend discretely without being questioned? The definition and space are critical because it is tough to get one spouse to agree that a spending decision was necessary, even if the other disapproved. My friend complained that she had used her joining bonus to get a diamond necklace for her daughter’s 16th birthday. It was an independent decision and she did not consult the husband as it was her money. He disapproved of it and resented what he saw as a pattern, where she made impulsive spending decisions that were harmful to the household, in his opinion.Wasn’t she entitled to spend the money she earns? Isn’t it nice for women and girls to have jewellery? Does a special occasion not deserve an indulgence? Why does he have to puncture the joy of buying a gift from the money that is her bonus? Doesn’t he make decisions big and small without consulting her? When he bought himself luxury travel suitcases of a popular brand, he told her they earned well enough to do that. Is it that he cannot be questioned because he earns more? These were her questions. They arise because the ground rules of household finance have not been set.In these days of adequate income, many households don’t budget or keep accounts. They live with the general sense that there is enough money for everything. Which expense will be acceptable and which would be questioned is not subject to agreed principles, but ad hocism that can turn either way. What would those rules be? Why are they needed?We will address the second question first. For most of us, money is a limited resource. This means there is an opportunity cost. Money spent or allocated to one thing is not available to spend or allocate for another use. Couples quarrel about money because one has another use in mind for the money decision that the other made. Unless there is an unlimited reservoir of money, or unquestioned power over its use, one partner will question the other about money decisions. Here are some rules that can be adopted.Label expenses togetherFirst, get a sense of the expenses that the household’s pooled income should fund. These include mandatory items like rent, utilities, food, fuel, education and discretionary items such as travel, entertainment, etc. If a couple is quarreling over each of these—which car to buy, where to eat, how much EMI to pay, where to send the children to school, where to go on a vacation—the problem might be about their personal principles or the income might just not be enough. There is no escaping the reality of how much the income is and, thus, what they can label as routine expenses. Many households skip this critical step. Pool the income of the household, put it out in the open and discuss its allocation for routine expenses.Second, list the common financial goals and work hard to achieve a consensus. Saving and investment decisions require this consensus, however tough that may be. Financial planning tools smoothen the process of listing and allocating money for future goals. Involving your spouse in mapping those and agreeing to save and invest as needed is key to ensuring that major financial goals are funded adequately. Blindly buying jewellery or property might not meet this requirement, even if they tend to look like investment decisions. Nor will speculating on stocks in desperation build wealth. Take the help of professionals to see how the costs, risks, market value,maintenance, and disposal of these assets would happen, so that the decision to allocate money on these assets is made with complete information and understanding. It is common for couples to have different risk preferences, and an investment portfolio must be diversified to take both positions into account. Not a tough task, but mandatory.Third, agree to split equally what remains after the core expenses and investments, and allocate a percentage of this for discretionary expenses of each partner. There is little merit in arguing about who earns how much, and if both earn at all. Just because there is no market for household responsibilities, the work a woman puts in has been unfairly discounted for too long. Even with women who choose to be employed, there is no disputing that having a child and raising a family has the potential to derail or slow down her career progression. Partners contribute their time, energy and resources to the household to the best of their abilities and circumstances, and are entitled to an equal share of the residual income after the above two steps. Allow complete agency in spending this portion, however big or small it is. The diamond necklace and the luxury suitcase fit in here. When couples try to push their personal expenses into the family income pool, disputes can be expected.There are various versions of his, hers and ours in practice, when it comes to family income. But they essentially delineate what is available to everyone, and what is discrete to only one. This line must be drawn early, and with complete understanding of consequences. It takes work and, perhaps, an external well-wisher or adviser to put it all down if the household is willing to be transparent about it. It won’t magically resolve all disputes over money, but there will be a framework or method that can keep the madness in control.The Author is Chairperson, Centre For Investment Education and Learning(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)