For some people, marriage marks a new beginning for two individuals, united in heart and soul. For others, marriage presents new sets of problems and challenges—wrapped neatly with a cute, frilly ribbon. Such problems range from raising children to cross-cultural values and conflicts, infidelity and financial instability.
Managing finances typically become one of the top reasons most couples divorce and end up unhappy. While couples can gain financial advantages when they get married, it’s not uncommon that they still commit financial mistakes that can bring them to financial ruin.
Here are 5 ways couples can avoid that, and instead achieve proper financial happiness.
Financial Planning is Key
Some couples get married on a whim; others plan their life out first. After all, what happened in Vegas will definitely bite them back afterwards. Financial planning is the key to financial stability not just for couples but for everyone. Creating this plan lets you map out the important purchases you as a couple need to make, the emergency situations you may need to take money out, the growth of your savings account and a small portion for affordable luxuries. Winging it will only cause both of you pain in the long run.
Talk to Your Spouse
Communication is a huge aspect of every relationship. Couples need to learn not to hide things from each other—including their finances. From all your purchases, debts, and risks to tax refunds, salary increases and credit card rebates, you must bare everything to your spouse. Before making a mutual fund investment, buying a car or a brand-new home, lay the cards down. This way, you know what to expect when things get rough.
Have Separate and Joint Bank Accounts
It’s difficult to decide whether to have a separate or joint bank account, so why not have both? Having a separate bank account gives couples financial independence. They, however, let you become accountable for your expenses and savings. If you make a financial mistake, you can’t just take out money from your spouse’s account, vice versa. Joint bank accounts let couples keep track of their purchase decisions easier. Having both lets you have your own savings and invest in important matters as a couple. No need to quarrel about closing one’s savings account.
Handle Debt as a Couple
Every person has some kind of baggage when entering a relationship, let alone a marriage. From emotional baggage to debt, it’s important that couples take care of these problems as soon as possible. Even if in some stats individual debt won’t carry over in marriage, help your partner relieve themselves of their financial burdens. Instead of leaving them hanging, strategize how to utilize each other’s income to take care of debts owed.
Save 10% of Your Income
Emergency and retirement funds aren’t typically the top of mind when it comes to couple’s savings, especially when such couples live from paycheck to paycheck. But saving 10% of your income for such lets couples live with a safety net; if one gets sick and health insurance can’t cover everything, having that monthly 10% investment on an emergency plan will save you in the long run. When both of you retire, you can have your own money and government subsidy to ensure you’re living comfortably.
Every person needs to be smart when it comes to their finances. Couples, doubly so. It’s not just their individual well-being that’s on the line; it’s their future, too. Achieving financial stability and security lets couples live comfortably, ready for any kind of emergency. Always strive to achieve that.