Why financial compatibility is the new relationship green flag

Money doesn’t just influence what you can afford – it shapes how you build a life together. In fact, financial stress continues to be one of the most significant sources of tension in relationships. Understanding your partner’s approach to spending, saving and planning can dramatically improve not just your financial future, but also your emotional connection.

“Your money habits are part of who you are,” says Stian De Witt, CFP®, Executive Head of Financial Planning at advisory firm NMG Benefits. “When partners understand each other’s financial mindset - whether one’s a saver and the other’s a natural spender, they’re better equipped to make decisions that support both the relationship and their long-term goals. It’s not about agreeing on everything; it’s about creating clarity, fairness, and a shared direction.”

Start with the basics: your financial personalities.

Every couple has their own blend of money habits. One partner may love budgeting, while the other might be more carefree with spending. These differences don’t have to cause conflict - but failing to talk about them often does. Understanding each other’s financial personality creates space for more aligned decisions, from daily budgeting to long-term planning.

Build a foundation for stability.

Healthy relationships thrive on structure, and that includes financial structure. Agreeing on how you’ll manage income, split expenses, and handle financial admin helps avoid resentment and ensures both partners feel seen and respected. A fair system leads to fewer arguments and more teamwork.

Create shared goals that excite you both.

Whether it’s a dream trip, a first home, or planning for a future family, shared financial goals bring couples closer. When you plan together, you’re not just talking about money - you’re talking about your hopes, timelines and priorities. This promotes deeper communication and a stronger bond.

Financial transparency builds trust

Financial infidelity can be as damaging as emotional infidelity. Transparency creates trust. When partners plan together, set goals together, and openly share financial realities, it becomes easier to stay aligned and avoid surprises.

Navigate life’s transitions as a team

Life changes - new jobs, relocations, kids, changing priorities- all come with financial implications. Regular check-ins help couples adjust their goals, stay on track and support each other through each stage. These conversations strengthen the connection and ensure both partners feel secure.

“At the end of the day, money isn’t just about rands and cents, it’s about shared dreams,” says De Witt. “When couples take the time to understand each other’s financial habits, they’re not just planning for financial success. They’re investing in the success of their relationship.”

Private market investments and the umbrella fund dilemma

For many large employer groups that offer retirement benefits for their employees, investing in umbrella funds is a cornerstone of capital stability and growth. By pooling resources from multiple employers, umbrella funds offer economies of scale, professional governance, and administrative efficiencies that individual corporate funds often cannot achieve. Yet, as Raazia Ganie, Executive Head of Investments at advisory firm NMG Benefits, points out, the decision to invest or disinvest in an umbrella fund requires careful consideration: “Umbrella funds are designed to grow capital efficiently over the long term, and the process of moving between funds for short-term gains can be far more costly than many employers realise.”

Umbrella funds are structured to provide both scale and flexibility, often enabling exposure to a broader range of asset classes than smaller standalone funds. Increasingly, these funds are allocating capital to private market investments like infrastructure projects and private equity, which carry the dual appeal of higher returns and tangible economic impact. As an example, some funds have invested in truck stops along key national routes, which generate real returns, provide services for drivers, and create ongoing employment opportunities in the surrounding communities.

However, the illiquid nature of such assets introduces challenges. Unlike publicly traded equities or bonds, infrastructure and private equity investments cannot be easily sold or transferred, particularly in South Africa, which lacks a developed secondary market for such holdings.

“The problem is not that the investments are bad,” says Ganie. “It is that the mechanics of moving them require careful planning to avoid unnecessary costs and operational risks. When assets in one umbrella fund are sold, and then repurchased in another, they incur trading fees, buy-sell spreads, and days of out-of-market exposure, all of which directly impact investment returns. And, ultimately, the employees end up bearing the bulk of these costs.”

Another subtle but important consideration is the overlap of underlying assets. In South Africa’s relatively small market, moving from one umbrella fund to another often results in owning the same equities and bonds on the new platform. You are essentially buying and selling the same assets – the provider may change, but the trading and administrative costs remain real and measurable.

Ganie stresses that disinvesting from an umbrella fund is rarely warranted purely due to investment performance or minor administrative frustrations. Valid reasons include serious governance concerns or persistent, unresolved servicing issues that cannot be rectified.

Ultimately, investing in umbrella funds, especially those with exposure to private markets, requires careful deliberation, patience, and professional guidance. While the rewards, including enhanced returns, social impact, and alignment with national policy objectives, are substantial, the hidden costs of poorly considered fund switches can erode value and undermine long-term outcomes.

By prioritising informed, strategic decision-making and working with expert advisers, employers can safeguard their employees’ retirement savings while participating in the growth of the broader economy. For employers and trustees, the strategic choice is clear: work with established employee benefits and investment advisers who understand both the operational nuances and the long-term horizon.

“An experienced partner helps employers and trustees to evaluate not just the returns of a fund, but also the full cost and implications of moving funds. A long-term relationship with a trusted adviser ensures decisions that are based on knowledge and alignment with the employees’ best interests over decades, rather than short-term performance,” ends Ganie.