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Congrats if you are considering developing money management and high-income skills at such an early age. It’s undoubtedly a brave decision to accept that a successful relationship consists of the following factors:
“Successful relationship = Love & understanding + right money management skills.”
We all know that marriage is all about compromises. But you can lessen the compromises by adopting the proper money management skills. According to the stats, in more than 21% of conflicts, money is the main reason. So, if you want to sort out this issue, then there is good news. Yes, there is a way of combining finances that will help take your marriage out of trouble. But at first, you need to learn the basics:
What is meant by shared finances? Money management is everything:
According to the national statistics, the success of the marriage rate is hitting a record low. Now, most of the couples are deciding to stay separate. But we can save this ratio by adopting preventive measures. When couples share their expenses to run the household, then we call it shared finances. But every couple has a different way of joining finances. For instance, some couples open a joint account or keep the money separate and only share expenses. So, the approach is different for every couple. You can successfully manage the finances irrespective of the method. Here are other tips that couples can use to manage finances efficiently:
Try to be transparent:
Transparency is everything when we talk about managing a whole household. For instance, if one person doesn’t communicate well about debts, it will ultimately affect you as a couple. According to the survey run by Policy Genius, 20% of couples who keep their accounts and finances separate are now planning to part their ways. So, keeping secrets in marriage is a significant downturn for a happy marriage. So, when it comes to transparency, here are few suggestions:
- Don’t keep secrets from each other.
- Couples should discuss if they have any financial fear in marriage
- Be transparent about your financial expectations from other people
Apart from this, if one person is earning less, the spouse shouldn’t let that person feel guilty. So, by discussing it, both persons can make a way out if the other one is earning less.
It’s helpful to make a joint account & budget:
If, as a couple, you want to track income and expenses, then it’s an excellent way to open a joint account. In this way, you will be able to track the statement of all records effortlessly. If you look around, organizations do the same thing to keep a record of income & expenses. For instance, in companies, there is a common usage of paystub makers for better financial management. So, this is the same thing in the case of personal money management. By making a joint budget, you get an insight to handle things together. So, the budget shows the sources of incoming and outgoing money.
Set up an emergency fund:
The emergency fund is of utmost importance when it comes to budgeting as a couple. According to a recent survey, around 80% of workers live paycheck to paycheck, which is alarming. So, after seeing these stats, it’s crucial to develop an emergency fund that you can later use for unforeseen circumstances. But the size of this vital fund depends on your needs and specific situation. Here is the list of expenses that don’t come under the emergency fund:
Mortgage or rent payment | Personal loans | Federal income taxes |
State taxes | Vacation home | Utilities |
Food | Clothing & laundry expenses | Automobile expenses |
Note: It’s vital to mention that you should change the emergency funds ratio after some time. It means that amount depends on your priorities and current expenses.
Set your goals:
You can’t achieve any purpose without setting goals. It’s possible and normal if couples don’t have the same goals. But you can indeed work on drafting shared plans like buying a new car, house, or clothes. Later, you can work to achieve milestones at different stages of life. Moreover, it’s a good idea to note down short- and long-term goals. In this way, both of you will remain focused on your destination. Apart from this, you can take different decisions like:
- Whether you want to merge expenses or not
- Are you going to open a joint account or not?
- What would be your household budget?
- Discuss your spending plan with each other
We know it’s not a romantic thing to do, but it surely multiplies romance and contentment in married life. So, always move ahead with a solid plan.
Remember communication is the key:
All of you already know that communication plays a primary role in making or breaking any relationship. So, if you want to run on good terms, then say an extensive YES to the communication. But there are specific rules that you will have to consider while giving openness a priority.
- Always keep marital money management a personal thing. So, it doesn’t matter if your couple is working on a combined or separate system; learn to keep things private. Above all, don’t forget to discuss individual goals, values, and expectations.
- Apart from this, it’s vital to keep a regular check on your partner. Marriage is a long-term commitment, so you should plan everything from household expenses to kids’ education. In this way, you can effectively make shared plans that require money.
Most importantly, you need to understand that you will have to make compromises in life. So, it’s an excellent approach to be a little flexible regarding your goals and views.
Final verdict:
Marriage is a contract where you let go of something at the cost of those things that are most important. So, it’s an excellent approach to recognize your differences and respect the feelings of each other. However, don’t judge your partner and make the conversation to stay on the same page. It is evident from research that people who don’t work for money management are 5% more likely to leave their partner. Thus, it’s always better to make out financial things by using these tips:
- Create a proper budgeting system
- Pay off your debts to feel less stress-free
- You can get life insurance for more financial stability in later life
- Encourage post-retirement savings for a stable future
- Always keep new ideas open
- Don’t hesitate to ask for help when you need that
There isn’t anything perfect when it comes to establishing a new relationship. But you can always make efforts to build trust and stability in your relationship.
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