Marriage is a serious phase in anyone’s life. Not only will you be sharing your life with another person, but you will also be financially responsible for each other. Money can be an awkward subject to tackle especially if you are not on equal financial footing. However, with the right approach, money need not be a sore point for you as a couple.
Here are five ways to keep your marriage happy and at the same time be financially healthy as a couple.
1. Discuss Your Finances with Honesty and Transparency
Marriage is about trust and that includes transparency about money. Technically you should discuss this before getting married. If you haven’t gotten around to doing it yet, then you should as soon as you get back from that honeymoon. Rose-colored glasses should be set aside because marriage is also about practicality and reality.
Lay it all out for your spouse. Declare how much you make, what accounts and investments that you have, insurance policies that you already have, etc. The most awkward part is stating how much debt you have, but you need to do it anyway. Each of you has to be aware of what each other brings to the table. Consolidate all your financial records and keep them in a safe place for easy retrieval.
2. Set a Budget and the Ground Rules for Handling Money
Having a two-income home doesn’t mean that you can go on a spending spree because you can suddenly afford to do so. Design your household budget together. Both of you should have inputs on how much you can spend on certain things. Set the ground rules for spending, saving, and handling money.
Review your expenses over the last few months to have a baseline when it comes to your spending habits for basic necessities, groceries, clothing, rent, leisure activities, etc. Set the dollar monthly limits per category. Also determine how you will be paying for it–cash or credit card. You also want to determine if there are any accounts that you might need to open.
To make sure that you are keeping within your budget, you will want to track your monthly expenses. Set aside some time each month to discuss financial matters with your spouse and take a look at how your spending is doing relative to the budget. Sticking to your budget takes cooperation, and you should both work as a team.
3. Set Your Financial Goals
Always look towards the future and set your financial goals together. They can be as serious as sending your future kids to an Ivy League university or as adventurous as a trip around the world once you retire. Once you have the goals in mind, estimate how much they would cost you in the future and work backwards from there. To be able to accomplish those goals, you must have a savings and investment plan as early as today. You can find a number of financial calculators that can help you figure out your own financial road map. Also, you will want to consider the services of a financial planner to help you figure things out.
4. Manage Your Debt
If you are old enough to get married then you should be old enough to act responsibly and that includes being responsible when it comes to managing your finances. Don’t act like a single person who doesn’t have a care in the world. You have a fiscal responsibility to your spouse and to the family that you will be having in the future. Think of that before going on a spending spree. You do not want to burden your spouse by incurring unnecessary debt.
On another note, keeping up with the neighbors is bad form. Every couple has a different financial situation and different financial goals. So, don’t compete with your neighbors, especially if you cannot afford it. It’s okay if you don’t buy the latest lawnmower or if you don’t have a membership to the country club. What’s important is that you stick to your budget and stay as debt-free as possible.
5. Make Sure You Have an Emergency Fund
Nothing in life is certain and that includes life as a married couple. You should always make it a priority to build an emergency fund that you can tap into when unexpected expenses occur. One of you might lose your job, somebody might get into an accident, or something in the house might need a major repair. These things are unplanned, and they might strain your finances. If you have an emergency fund, you can access that and still be able to make ends meet without going into major debt.
Money and marriage can be tricky. Finding the right balance takes some time. It is important that you talk about financial matters with your spouse and that you make decisions jointly.
What about you? How do you manage money matters as a married couple?