There are a number of financial tips that people encounter on any given day and the idea is to dissect and weed out the ones they need and can actually use. One way is to look at where they are in life and take off from there. There are a lot of tips out there from getting up on their feet after college, how to get out of debt and even how to manage finances after getting married.
Love is the ultimate reason why people get married and it can help guide all the decisions the couple needs to make moving forwards in including money choices. You need to use your finances to strengthen your marriage and keep it solid. Of course this is easier said than done but it is just a component of what you need to tackle as a married couple.
Preparations for the wedding is already stressing enough and add all the things needed to be done like rehearsal dinners and parties, getting hitched is an event you will never forget. But after all the ceremonies and your last guest leaving, the two of you are already on a journey for a lifetime. Life should get a little more exciting.
CDC.gov shares that the marriage rate for every 1000 people is at 6.8% but the sad fact is that more than half of that end up in divorce. There are a lot of reasons why people split up but finances is a usual suspect. There are a good number of married people who chose to call it quits because they cannot seem to agree with money management.
Tackling finances after getting married
It is hard work but not impossible. There are a lot of inspirational couples all around you that will prove to you that you can make it work. Here are a few things you might want to focus on so you and your partner can work out your finances accordingly.
- Putting together a household budget. This is one of the very first things you need to talk about. Your household budget is your working document and this is your primary tool in reaching your goals and surviving your day to day financial need. You need to sit down and put in writing your combined income and all the expenses that you expect to take up as you now live under one roof.
- Sitting down and splitting the bills. You might have had an easier time with your bills when you were still single because you did not have to split it up with anyone. It was all your responsibility and you had to pay for them on your own. But now that you are married, you need to split the bills and find a way to do that. One thing you can do is to divide the bill evenly and split it between the two of you just like how housemates would do it. You can also assign bill payments evenly between the two of you so you pay on bill in full. It is also possible that you contribute to a joint account and pay everything off from there. The important thing is you look into financial tips to pay for bills.
- Managing the financial personality of each. You are coming into the marriage with different financial personalities and you need to work together to cultivate and to a greater extent be able to check and balance each of your personality. One might be a spender while the other one is a saver so you need to strike a balance between the two of you. You can let the saver take care of the long term goals and spender to budget the day to day activities. This way, you work on your strengths but get a chance to be involved with the other aspects of your finances. The challenge is finding a common ground and not restricting one personality.
- Communicating about household finances. Another financial tip newlyweds can look into is that you need to keep your communication line open. Before you buy anything or even make an investment, make sure that you make a joint decision. You can set an amount say $100 where anything above that should be talked about. Anything below that amount can be discretionary but you still need to inform your partner about it.
- Pointing out your financial goals. You run the risk of wandering through life not really accomplishing anything when you do not set goals in the first place. Think of a ship that sails aimlessly out in open sea with nowhere to go. You need to set out goals and targets in life especially with your finances so you can chart your progress. Do you plan to pay off your student loans in five years? Then plan your finances and make the necessary payments to reach your goal. Do you want to retire early? Plot out the contributions you need to make to reach your goal. The important thing is that you discuss this with your partner your plans and you both need to agree on it so you both can work together to reach it.
- Talk about acceptable debt. WSJ.com shares in an article that the 2015 college graduates has the highest average student loan debt at $35,000. Student loan is seen by most as a necessary debt to further their career. When you get married, you need to discuss with your partner what these acceptable debts are so you do not fight over the finances later on. It can be a mortgage loan for the house, auto loan for the family car or a personal loan for a school need. But if you rack up hundreds of credit card debt for unnecessary purchases, you might get into a fight and risk the stability of your marriage.
What needs to be discussed prior to getting married
Even before getting hitched, there are some financial things that you need to discuss with your soon-to-be partner. Here are a few things you might want to take up in the relationship leading to marriage.
- Credit score. You need to talk about your credit score before you even talk about getting married. This is not to judge the other person but to make sure that you get an idea how the other person values their finances. It doesn’t usually follow that the lower their score, you need head on out the door running. You need to understand that there are a lot of variables that leads to a low score so you try to get to the bottom of this. But be reminded that this is not something you take up on the first date.
- Existing debt. Newyorkfed.org shares that mortgage loans are some of the biggest household debt items that accounts in a household’s budget. But before you get to that, try to understand what debt your partner is bringing into your marriage. You need to do the same as well with what you have and come clean so there are no surprises when you get around to talk about your budget as husband and wife.
- Financial outlook. It is also important to discern what your partner’s plans are financially when you get married. This helps you align your priorities and see if you have the same goals and dreams. One might want to retire early and you want to travel so you can merge the two and try to find out how you can work together in reaching your goals.
There are financial tips that you can look into as newlyweds that can greatly help you align your money habits and goals in life. You just need to talk about it and do not procrastinate in discussing this as husband and wife.