As a newlywed, it is natural that your mind is full of hopes to have a fulfilling life in every aspect, a life filled with happiness, a frequent dream come true moments and every blessing that can be bestowed on you. Life is definitely full of promises but to have a great married life you need to stretch a bit more. After all, being married doubles not only your joy but also your responsibilities. Out of the many tips, you receive to ensure everlasting happiness for you, never ignore the financial tips as they help to make your life secure.
Quick Navigate Our Tips
- 1) Share Your Financial Status
- 2) Set Financial Goals – Both Short-Term and Long-Term
- 3) Strike A Deal
- 4) Make a List of Income and Expenses
- 5) How Much And How To Save
- 6) Set Aside For Expenses
- 7) Be Ready For A Higher Share of Financial Burden
- 8) Check If You Are Financially Ready To Buy A House
- 9) Make Smart Purchases
Knowing each other’s finances goes a long way in planning a budget. Right from your earnings to your debts, never leave anything out. Such sharing of information helps to assess where you both stand in terms of finance, your affordability level, how much you can save and how to achieve your financial goals.
2) Set Financial Goals – Both Short-Term and Long-Term
Once the earnings and expenses including debts are clear, you can start planning on the financial goals to achieve, both short-term and long-term.
Short-term loans are those that can be achieved within a year. While identifying your short-term goals ensure that they help you achieve your long-term financial plans.
Some of the short-term goals include:
• Pay off debts particularly credit card debts
• Find more ways to increase earnings
• Increase the amount saved every month or start saving a good percentage of your earnings
• Create an emergency fund
• Adopt a strategy that would make you financially disciplined
• Save money towards making down payment for car or any important purchase you intend to make
Long-term goals are those that need more than 5 years to achieve. Some of the long-term financial goals include:
• Purchase a home
• Have diversified investments
• Save for life after retirement
3) Strike A Deal
Yes, you are not business partners but are partners in marriage. Still, striking a deal for having healthy finance does not harm your relationship. The deal is just about not spending beyond a particular amount without discussing with the spouse. Set the limit based on your income and goals. It helps to prevent any unwanted surprises and to plan well.
4) Make a List of Income and Expenses
Entering into married life, you may find yourself spending more than what you have been used to. Well, it is definitely a part of married life, particularly if you are newlywed. Apart from the spending spree in the early days of married life, which is quite natural, take into account all the expenses that occur on regular bases, such as rent, monthly bills and so on. Your spouse may have a different approach to spending but write down every possible expense. Make a list of your earnings as well.
With the statement ready, look for expenses that can be cut off totally or reduced. Calculate how much of your money goes into spending and how much remains on hand every month. By working a way to cut down costs, you can save more money for later use.
5) How Much And How To Save
Well, you have your income and expense statement ready. The next thing to do is to decide on the amount to be saved every month. If you don’t come to a head on a figure, try to come to an agreement for a figure in between. Remember, your spouse partners with you in pleasures and pain and hence no compromise on his/her wishes.
Never go by what you see in the list of expenses but decide on how much of the earnings you intend to save and alter your expenses accordingly.
Once the saving amount is agreed upon, discuss on how to save them. It is best that it is divided between banks, assets, and investments. Talking about banks, discuss if it is going to be an individual account or joint account. Having a joint account works best for many.
6) Set Aside For Expenses
Apart from setting aside money for the expenses you have on your list, have some money as a reserve for unexpected expenses. It will prevent you from borrowing when a need arises or avoid withdrawing from your savings. By the end of the month, if a need never arose, you can deposit the money in the bank or add it to your emergency fund. This helps to save some money indirectly.
As you enter into wedlock, both of you may be working and hence you may have planned your expenses accordingly. However, you may not remain two for long unless you decide so. When the spouse gets pregnant, the husband may have to share a greater or the entire financial burden till his wife returns to work. In cases where either of the partners goes out of a job, again it is the working partner to shoulder responsibility. Hence, it is always best to consider such possibilities and be prepared so if such situation arises, managing it will be comparatively easier.
8) Check If You Are Financially Ready To Buy A House
Buying a house is a dream of every newlywed. However, before moving in that direction, check if you are ready financially. Here is how to know if you are ready:
• No pending loans
• An impressive credit score for a better bargain
• Cash available for down payment
• Savings other than down payment cash
• Alternate plans for income if one of the two goes out of job
As a newlywed, it is difficult to meet most of the criteria mentioned above. Under such circumstances, it is best to live in a rented house. As you have just been married, it is definitely not too late to buy a home.
9) Make Smart Purchases
A wrong purchase makes you lose money in more than one way. Be it furniture or car, consider the following before you go for it.
• Big size need not necessarily be right for you always. Don’t go by the size of the product but decide on its utility value to you.
• Buying used products save you money. It may seem a nice idea to have a brand new car but it only serves the same purpose as any other used car only it is more expensive. You may be able to buy a used car with the cash you have on hand but a new one may require you to go for a loan. Even if you can afford the monthly payments, consider if it will affect achieving your long-term goals. It also helps to remember cars depreciate in value so you are not investing money while buying a car.
• Decorating your home is a great idea but never overspend on it, particularly, if you are in a rented house. Save them all for your own home.
• Before making any purchase, consider if it is really essential. If yes, look for cheaper rates.
It is not uncommon to fail in following the financial rules you both have set for yourself. But that is no excuse to continue failing it. Remember you will soon have kids to raise and hence be good with your financial handling to give your family a secured future.