Saying, “Yes!” to forever together comes with unforgettable memories and exciting future plans. Tying the knot doesn’t just mean that you are now sharing a home and life together, it also means you are managing your money and finances jointly as well. There are a few important monetary topics that you and your partner will need to discuss in order to make sure your money transition goes smoothly.
Surprisingly, money management is one topic that gets left by the wayside more often than not when people get married. In fact, money is one of the most stressful topics among married couples. With that said, having a proper plan in place on how your money management will change once you are married will make a significant impact on your world financially and romantically. Most newlyweds may think that a quick discussion on debt, basic money management, and incomes is enough to pave the road for their financial future. However, the reality is this is just the tip of the iceberg!
Here are 4 things you will need to adjust and discuss with your partner for a financially happy life.
1. Managing debt
2. Creating your budget together
3. Setting savings goals
4. A joint bank account
Studies show that the higher your combined debt is, the more often you argue about money. Getting on the same page about all the debts for both partners is the first step to planning for proper debt management.
Understanding the debt’s origin and how to manage—and eliminate—it are key to an open financial marriage. If you are both working toward the same agreed-upon goal(s), the debt will not seem as insurmountable.
Ask any financially successful couple what their secret is to building wealth and managing their money correctly and the majority will likely respond with: budgeting. Creating a budget together and sticking to it on a regular basis may just be the one thing that will make or break your financial management as a married couple.
Budgeting only needs to take 15 minutes per week, so don’t be intimidated. It should cover a quick discussion on income, bills to pay, debt management, savings, retirement, investments, and future purchases. Check out our personal finance management tool, Money Manager. Not only does Money Manager make budgeting easy, you can setup various alerts! With both of you being “in the know” regarding where you stand financially, you will eliminate potential miscommunication and make it seem like the honeymoon never ended.
Setting Up Savings Goals
Are you a saver or a spender? How about your spouse? Chances are that one of you likes to spend money while the other is an adamant saver. A savings plan is an important topic to discuss with your spouse, so you can plan ahead for major purchases, child-related expenses, education, vacations, and retirement.
Discussing desired goals regarding major events and purchases allows both spouses to keep communication open. Among the more important savings plans, retirement should be among the top three. These questions are among some every couple should ask themselves:
How many years do we have until we wish to retire?
What will our expenses be in retirement?
What is the total amount of money we will need to have saved in order to maintain our current lifestyle in retirement?
Once you’ve answered these questions, you can create a plan together to ensure you’re on track. For Empeople members, you and your partner can check out our PLAN tab in the navigation above to explore your options. If this topic seems too complicated and hard to discuss, a Empeople representative will learn about your goals and work with both of you on your future plans as a couple. Together, we’ll create a future-proof plan.
It’s not uncommon for couples after marriage to continue utilizing their separate, individual bank accounts. However, this plan has some downsides and can lead to significant problems in the relationship that affects more than just financial discussions. Shared expenses such as insurance, taxes, rent or mortgage payments, and other family expenses are inclusive to both spouses, and as such a joint bank account makes sense.
Furthermore, having a combined bank account enables the first three money management tips to fall into place regarding budgeting, savings, debt management, and retirement planning. Combining bank accounts once you are married will make it easier to communicate about finances and allow you both to work together towards your financial goals. Not only is this a healthy practice for financial management, but it’s an overall robust approach to a successful marriage and communication overall.
Haven’t created a joint account yet? Ask Empeople about our joint checking and savings accounts options. We are here to assist you any way we can along your financial journey.