Teamwork Makes the Dream Work: How Newlyweds Can Make Finances Work Better Together
Did you know that financial problems are among the leading causes of divorces? Unfortunately, some couples don’t necessarily pay attention to that critical part of the vow – “For richer and for poorer.”
But the good news is that most money-related problems couples face are totally avoidable. It just takes being willing to listen to sound financial counsel.
The following includes some tried-and-true tips New Era Debt Solutions believe newly married couples can use to start out on a strong foundation – both financially and relationship-wise:
Don’t Be Afraid to Communicate
It’s no big secret that for most people, talking about money is awkward. But a few moments of potential awkwardness is a small price to pay for a lifetime of bliss and fewer money issues.
Find the right time to talk with your partner, spouse, or spouse-to-be about what your financial goals, concerns, and spending habits are. If you have different financial personalities (i.e. one of you is the spender, while the other person is the saver), it’ll be important to make compromises on what matters most to you. And remember – it’s okay if you don’t agree on everything. As long as you’re both working towards common goals, have savings, and each person has dedicated spending budgets, you’re likely to stay on track for financial health. The last thing you want to do is find out any earth-shattering revelations related to your partner’s finances, such as exorbitant credit card debt. After all, financial infidelity is almost as bad as marital infidelity.
Decide on the Number of Accounts You Need
Some couples like to do everything together, including sharing a joint bank account. This isn’t a bad thing, but it may be worthwhile to think about having separate accounts as well. This will lessen the amount of control one partner may perceive the other of having when it comes to spending.
There are pros and cons to having a join bank account. The main benefit is having the knowledge that you’re both working towards shared financial goals. But the main pro of having separate accounts is allowing each person in the relationship to feel some sense of independence – in other words, not feeling that every expenditure is being judged by the other partner.
Update Insurance Coverage
One of the fastest and easiest ways to save money on your house and auto is to combine you and your partner’s policies. Just make sure that you do your research to see if combining your policies will actually be more cost-effective than simply keeping your own insurance plans in place.
Update Your Beneficiaries/Will
Now that you officially have a lifelong partner and it’s in writing, it’s time to update the beneficiary information on your financial accounts, savings plans, retirement plans, and insurance policies. Should the worst happen to you, you’ll want your partner to have access to your assets. This also applies to your will, if you have one, especially if one or both of is bringing a significant amount of assets into your marriage.
Pick the Magic Number
Commit not only to each other, but also to a percentage that you will set aside each month towards savings (aim for at least 10 or 15% of your income!). Your initial savings should be saved for emergencies, while the rest of the money you build up can be put towards retirement and any other long-term financial plans you have.
Track Your Progress
Observe your month-to-month spending together to see where you did well, and where there might’ve been gaps. Even though most newlyweds start out living quite frugally, it should still be your overall goal to live as debt-free as possible.
Even if you do take all the precautionary steps to ensure a more stable financial future, it doesn’t necessarily mean that you and your partner won’t have to face some troubles. You never know when a family emergency, major home repair, or employment situation may come into the picture. But you will have the reassurance of knowing that your partner will always be there by your side.
New Era Debt Solutions has settled more than $250,000,000 dollars of debt since 1999 and wants you to be our next success story. If you need assistance achieving financial freedom, contact one of our friendly counselors at New Era Debt Solutions to learn more about finding the debt relief option that best fits your needs and budget. Our counselors are with you every step of the way.