(Real Simple.com) -- Here are some essentials talks to have with your spouse, your kids, and your parents.
With your spouse
•Where does all our money go?
Why it's important: If you don't know where it goes, you could end up running low, not to mention straining your relationship.
"Financial issues are the number one reason I see couples divorcing," says Barton Goldsmith, a psychotherapist and the author of "Emotional Fitness for Intimacy."
The biggest marriage-buster among them? Over-spending. "Oftentimes a spender marries a saver," says Goldsmith. "They need to master the art of compromise, and if they don't, their relationship can quickly get complicated."
The ideal time to talk: Yesterday, says Goldsmith. Every couple needs to have this discussion. Even if your finances seem to be in good shape, you should check in regularly in case priorities change or debt sneaks in unnoticed.
What to do first: Suggest to your spouse that the two of you -- together -- keep a month long spending journal that tracks personal and household expenses.
How to bring it up: When the month is over and it's time to talk, focus on your feelings rather than his actions, says Puhn. Something like "Honey, I will sleep better if I know that our finances are in order" takes any judgment out of the discussion and offers your spouse a concrete way to work with you and make you happy. Then use the spending journal to help you both look for ways to stay on budget, cut back spending, or save more. It's also a good time to create a list of long-term savings goals.
• Do we need to change who does what?
Why it's important: Let's face it: It's rare and not always practical for couples to share equally in day-to-day financial duties. If the balance gets out of whack or if you're juggling tasks that you don't understand, then bills could be missed, credit scores could suffer, and, again, resentment and conflict may ensue.
The ideal time to talk: Some time before you feel like yelling, "Must I do everything around here?!"
What to do first: Compile a list of every financial decision that is made or task that is performed in your household, from paying the gas bill to reallocating your 401(k) investments.
How to bring it up: Suggest holding a monthly household-business meeting. When you talk about money at an appointed time, tempers stay in check and work gets done, says Goldsmith. At the first one, go over your list and reassign responsibilities more evenly and appropriately. Repeat as necessary.
• Are our retirement plans on track?
Why it's important: After the recent stock-market downturn, most people's 401(k)s look more like 201(k)s, says Goldsmith.
The ideal time to talk: As soon as you can.
What to do first: Open your account statements. With all the bad economic news, it's tempting to ignore them and remain on autopilot.
How to bring it up: Get right to the point. "I have been looking closely at our investments, and I'm worried we won't be able to retire at age 65" will certainly get your spouse's attention. Then quickly follow with "Let's figure out how to get back on course."
An online retirement calculator (like the ones at money.cnn.com) can help. It might also be a good time to schedule an appointment with a financial planner who can offer objective advice and make sure you don't overlook any options. (Find a licensed one at fpanet.org.)
• What is our risk tolerance when it comes to investments?
Why it's important: If one of you thinks that there is a fortune to be made in the market and the other can't stand the idea of losing a cent, you will be tempted to keep changing course and never meet your investment goals. Teamwork, people!
The ideal time to talk: Natural times to bring this up: during tax season, when you're looking at your investment income, and at year's end, when many people reevaluate their finances. But just checking your portfolio online can offer a chance to raise the subject.
What to do first: Learn to speak the lingo, says Puhn. Read some articles or books on investing, such as "You Can Do It!," by Jonathan D. Pond and "Smart and Simple Financial Strategies for Busy People," by Jane Bryant Quinn and you'll see that knowing your risk-tolerance level -- whether low or high -- is essential to successful investing. (These books will also help you assess your tolerance.)
While you're at it, adopt non--Chicken Little terms, such as "risk tolerance," instead of saying, "I'm scared we'll lose all our money!" Try to temper your emotions.
How to bring it up: If you're the one who is averse to making risky investments, simply state that you are not comfortable with having such an aggressive portfolio. If you're the more aggressive one, ease into it -- you don't want to scare your partner off.
Saying something like "I think we're missing enormous opportunities because we're too conservative" should help get the ball rolling. Either way, both of you should be prepared to find a middle ground, says Puhn, for the sake of your relationship, if not your portfolio. (After all, these days, who can predict what will happen to that?)
Meeting with a fee-only financial planner (who won't steer you into investments that pay him the highest commissions) can also help you find investments and formulate long-term savings goals that you are both comfortable with.
With your kids
• You don't need that new iPod. You want it.
Why it's important: Determining what is and isn't essential will guide their spending habits for a lifetime.
The ideal time to talk: As soon as kids start to notice what things cost, usually in the first or second grade. Hammer home the point during their brand-conscious tweens and teens.
What to do first: Print out a copy of your family budget. (If you don't want to show your income, limit the figures to monthly expenses.) Then go over it with your kids. Don't have a budget? Download a free template at office.microsoft.com, and make one together. (Search for "family monthly budget planner.")
How to bring it up: "Let's take a look at where the money goes" is a good opener. Getting kids interested may be easy: Sixty percent of the teens surveyed in a recent study by the investment firm Schwab and the Boys & Girls Clubs of America said that learning about money management is a top priority.
• I'm giving you your first credit card. But ...
Why it's important: Think of it like driving a car: The only way kids can learn to use a credit card wisely is by (gulp) borrowing yours.
The ideal time to talk: When they're juniors or seniors in high school. Certainly before college, where they will be inundated with credit-card offers and are liable to spend irresponsibly. The average credit-card debt among college students recently hit an all-time high of $3,173, according to a survey by lender Sallie Mae, and 40 percent of students said that they charged items knowing they didn't have the money to pay for them.
What to do first: Add your under--18-year-old as an authorized user on your account. Set a $100 credit limit on her card, says Jennifer Austin Leigh, Psy.D., a psychologist and a family adviser based in New York City. If she handles that well, increase it by $100. "If you give kids too much credit to begin with, you're setting them up to fail," says Leigh.
How to bring it up: Handing over the card will get her attention. But follow it up with the analogy of the $50 pizza, says Linda Sherry, director of national priorities for Consumer Action, a consumer-education advocacy group. You charge a $10 pie but forget to pay the bill. Then you're hit with a $40 late fee, and before long that pizza costs five times as much. From there, you can explain interest charges, minimum monthly payments, credit scores, credit reports, and how it can haunt you if you're not responsible with your plastic.
• Let's plan how best to pay for college
Why it's important: The average annual cost of college? About $25,000 for a private school and $6,500 for a public one. No wonder two-thirds of undergraduates receive financial aid (mostly in the form of student loans). As a parent, it's your job to work out how to put your child through college without leaving her in serious debt or bankrupting your own retirement, says Kalman A. Chany, founder of Campus Consultants, a college consulting firm based in New York City. Whether or not your child has to help contribute, include her in the discussion.
The ideal time to talk: You and your spouse should begin to consider the costs of higher education as soon as your child is born, says Chany. And start saving right away. Once your child starts to talk about college, which usually happens when he's in middle school, it's a good time to introduce how much it costs.
What to do first: Start investing in 529 plans and Coverdell Education Saving Accounts, which work like Roth IRAs. Visit savingforcollege.com, a Web site that compares various savings options.
How to bring it up: Be positive with your child. This is not about discouraging him or scaring him away from higher education; it's about stressing that cost could factor into the decision. Explain to tweens that tuition can be expensive: "I'm so glad you're thinking about college. We should all start talking about how to pay for it."
For high school kids, get specific: "Those are great options, but let's include some more affordable schools on your list, too." Be up front about financial aid: In some instances, you'll need to talk about how to share the expenses and explore different possibilities for scholarships and/or loans.
With your parents
• Do you have enough to retire comfortably?
Why it's important: Thirty percent of adult children contribute to their parents' finances, according to the Pew Research Center, an independent research organization in Washington, D.C. With many people living into their 80s and beyond, it is more likely than ever that retirees will outlive their savings.
The ideal time to talk: It's never too early. If your parents seem too young or are already retired, discuss long-term planning.
What to do first: Check with your siblings to see if they have had similar conversations with your folks. It might be best to have just one adult child make the approach. The retirement calculator at bankrate.com can estimate how large a nest egg your parents will need in their retirement years.
How to bring it up: Gently. Having a context for the conversation helps: "Mom, I noticed that you were careful at the grocery store. I don't want you worrying about money during retirement." Remember: "It may take more than one try," says Virginia Morris, author of "How to Care for Aging Parents." "Often parents don't want to talk with kids about finances."
• Have you thought about long-term care insurance?
Why it's important: The average cost for a private room in a nursing home can reach $75,000 a year; home health-care costs can be $200 a day. Long-term-care insurance pays these expenses.
The ideal time to talk: When your parents are in their late 50s or early 60s and in good health. That is when they will be most likely to find an affordable policy.
What to do first: Search for and print out articles on the subject so you can present the facts clearly. (Here are several good ones: Long-Term Insurance Information.) For a sense of potential costs and insurance benefits, check out the LTC Insurance Evaluator tool at smartmoney.com.
How to bring it up: Use your grandparents as an excuse, suggests Marilee Kern Driscoll, founder of the e-newsletter Long-Term Care Planning Month (ltcmonth.com). Say something like "Mom, remember what you went through with Grandma when she was in the nursing home? She had to pay an awful lot of money out of her own pocket. Have you made any plans if that should happen to you or Dad down the road?" If your own family doesn't fit this scenario, mention one of your friends who has gone through a similar situation with her grandparents or parents. Then follow up by sharing the articles you printed out.
• In an emergency, who do you want to manage your finances?
Why it's important: If a parent is suddenly incapacitated, he needs a durable power of attorney to have someone make financial decisions on his behalf.
The ideal time to talk: Now, no matter how old your parents are.
What to do first: Draft a durable power of attorney for yourself -- everyone needs one. Or check out the software program Quicken WillMaker Plus 2010 ($50, nolo.com).
How to bring it up: Use yourself as an example. Tell your parents that you had a durable power of attorney written and ask if they have one. If they do, find out where the paperwork is. If they don't, offer to help. Use the opportunity to discuss other emergency legal documents, like a living will and a health proxy.
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