When tying the knot, you’re committing yourself to a shared life and financial responsibilities.
Financial problems, if left unchecked, can ruin marriages. It is important that you and your plus one have a common understanding about each other’s attitude and values about money, agreement on financial responsibilities, and how you want to budget and plan your finances. When it comes to managing a household together, it is important to work as a team. Here are some helpful tips:
1. Have a good understanding of each other’s money value
It is important that you take the time to understand your partner’s thoughts about money and spending habits. Chances are, you will have different views on money management. Some might tend to spend more, others save more. In this case, try to communicate what your expectations are of each other. It may take some time, but communication and honesty can help develop a mutual plan for spending and saving.
2. Be honest and open about all sources of income, expenses, debts and assets
You’re in a relationship because you’ve chosen each other to be your partners in life – in all aspects of it, including your finances. It is important that the both of you have a good understanding about each other’s financial situation: how much you are earning, how much you need for personal spending, and how much you want to keep and contribute to the household. You’re now a team, so regardless of whether you decide to combine finances (see below), make sure you are both on the same page from the getgo.
3. Budget together
While some couples may choose to have a joint account, others may decide to keep a separate one. None is better than the other – we believe that you are in the best position to decide what works best for you. It all depends on your opinion about money management, preference and personal situations. Regardless, you should keep in mind that you are sharing a life together, and both of you will have to play your part in household management as well as supporting yourselves financially. Once you’ve laid out the amount of household income you are getting and your expenses, you can build a budget together. Also, once you set this budget, make sure you go through it regularly going forward. You don’t want one person to build up resentment because that person thinks he or she is contributing more than the other.
4. Discuss short term and long term goals
Setting goals is a great way to stay motivated and give you something to look forward to. Discuss with your partner what your priorities are as a couple and as an individual. You can plan for those goals in your budget by including categories for savings. For example, perhaps as a couple you have a short term goal of having a date night once a month. Include a certain amount of money you want to save each week so you can make that goal happen. Individually, you may have a certain hobby that costs money. Include that in your budget as well. Your long term goals might require building larger sums of money such as buying a home, starting a family, or taking a vacation. Set a plan for when you want to achieve those goals, and then you can determine how much you will need to save each month.