4 Money-Savvy Tips for Newlyweds
Fairytale endings are possible, that is, until you and your spouse start talking about finances. From that point on, things could get messy, especially if you’re not in the same boat when it comes to money matters.
That’s not to say that the love you share will sustain your marriage, but if you leave out any talk about financial goals and budget plans, then you are setting yourself up for disaster. With the resources you have, you need a clear-cut plan and establish money-saving habits that will get you through more than just a rainy day. There’s no perfect guide to help you with this, but the following tips should put you on the right path towards mindful spending and saving.
1. Share Each Other’s Financial Situation
Having settled down, it’s never wise to keep each other in the dark about your financial status. Unless you’ve already talked about this before the wedding, you will need to set aside time to disclose any liabilities you carry over. This time, your spouse will share in the obligations, so you will have to reveal how much debt you still owe, the amount of savings you have, and how much you’re earning.
From this, it will be easier for you to come up with a repayment and budgeting plan that will help maximize your savings and reduce your total liabilities. Doing so will also help you decide whether you should open a joint account or start with separate accounts in the first few months.
2. Work Together to Pay Off Bills
If you’re both working, you will have to think about dividing your monthly expenses. Both of you might still be making repayments on loans, so it’s always a good idea to divide the rent or mortgage and assign who gets to cover insurance premiums and utility bills.
You should also do the same when it comes to other recurring expenses, such as groceries and transportation. To make this process simple to track, use a spreadsheet to know how much both of you are spending if you’re opting for a more equitable share across all household expenses.
3. Make Investing Plans Together
Much like creating a budget, you should also collaborate on determining which investments suit your current financial situation as well as your long-term goals. Since you’re starting small, look for investments that expose you to less risk and align with realistic goals, such as buying a house or having a baby.
It’s always a good idea to shop around for a private health and life insurance plan, but if you’re aiming to earn passive income, then look beyond private stocks and bonds. Consider looking towards real estate investment trusts and diversifying your mix of assets. If you live in Canada, you might also consider opening up an RESP, which will come in handy once your child graduates from high school.
4. Set Aside an Emergency Fund
You and your spouse might think that a savings account will be enough to help you finance your goals. So long as you allow the funds to grow, then you are all set. However, you can’t be too sure whether you will have enough to deal with major disruptions that can put a dent in your financial progress.
Accidents and sudden layoffs could set you and your spouse back, forcing you to take out a portion or all of your savings. A separate emergency fund will provide the cover you need to overcome any major financial hurdle and secure you for at least three to six months of being out of work.
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Uncertainties lie ahead, no matter how smoothly you and your spouse transitioned towards married life. By keeping these tips in mind, you can build the kind of future you want with all the resources you need for this next chapter of your relationship.