Manage Your Expenses: Money Management Tips for Couples
Getting engaged or married is a big step in anyone’s life. While there is the bliss that comes with starting a new life with your favourite person, there is also the anxiety of taking responsibility for a shared life. The latter can get to you if you don’t talk about practical things like money beforehand.
If you are yet to tie the knot, you have enough time to sort through your priorities, discuss financial planning and everything in between. The first and foremost thing to do when it comes to financial planning for couples is to lay down every single detail about your past. Right from your saving habits to your shopping impulses (if any) to your debts and savings, make sure your partner is aware of everything and vice versa. Transparency is the number thing you need to follow to have a happy, healthy, and lasting marriage. Secrets, especially when it comes to money, will only complicate things and that is the last thing anyone wants when they are starting a new chapter of their life. Right?
If you are tired from the search of ‘how to manage money as a couple’ and haven’t found any satisfactory answer or solution, fret not, we are here to help. Follow these budget managing tips to chart out a good financial plan and set it in motion. Of course, all of this happens after you have had the “talk” about your financial status, assets, and liabilities.
1. Share Your Financial Priorities
Not everyone has the same set of priorities when it comes to money. While some people want to see every inch of the world and live on the road, other people want to settle down and start their own family working at a regular job. Discussing this should be your priority. Along with this, asking your partner about their investment goals, savings and how much they want to donate in the future and spend on their children (if they want to have them), all of this is important questions that come under the ambit of financial planning for couples.
Of course, there is no right or wrong answer to any of the questions mentioned above, but appropriate answers are depending on what is your priority.
2. Jot Down Your Financial Goals
Once you are done with the important and often-times ‘difficult’ questions, you can now start with your shared financial goals . Where do you see yourself as a couple in five, ten years and accordingly discuss the possibility of investments and savings.
How a couple manage finances depends on each couple goals. Make sure you have the same ones for your future, from the cars you want to purchase, to the kind of house you envision yourself living in. If you wish to have kids and if yes, how many and also when do you see yourself retiring from your current jobs if both of you are working.
All of these questions bring a sense of clarity to your goals and financial priorities, ensuring you are on the same page.
3. Make A Budget That Suits You Both
The ‘difficult’ but necessary conversations are over. And now, it is time to manage expenses. You can do this even after the marriage, but make sure you don’t skip on this step. For your monthly budgeting, you can both spend from a single account rather than using both accounts, if you are spouse is also earning. Once you have subtracted all the utilities and other expenses for a single month, keep aside a percentage of your income to a different savings account.
Consider opening a new account with digibank by DBS . They provide easy opening with their bank, and the entire process of setting up a new account is seamless and hassle-free.
4. Keep Your Separate Accounts While Opening A Brand-New Shared Account
This brings us to another important point when it comes to financial planning, continuing with your separate accounts even after marriage. Yes, you will need one shared (joint) account for your monthly expenses and shared investments, but having your separate accounts helps you in retaining your individuality and gives you your space.
Your shared account can help you in tracking home expenses and availing home loans. When you have a joint account, you are eligible for better tax exemptions and bigger home loans than with a single account.
5. Pay Off Debt And Save For Emergencies
Having an emergency fund ready is of utmost important not just as a couple but even when you are living alone. Make sure you discuss this with your partner and work towards eliminating your existing debt and set up a snug contingency fund for rainy days you will have to wither as a couple. You can open a Recurring Deposit or Fixed Deposit for the same with digibank by DBS. Their attractive interest rates and paper-less set-up process is instant and tension-free.
6. Have Monthly Or Weekly Discussions About Money
You can set up a date for your money conversations and discuss investing in gold, real estate and equity-based Mutual Funds depending on your collective risk appetite. Of course, this should also be used as a time to discuss your current budget and how you are planning to proceed with your finances in the future.
7. Save For Retirement Together
After all these discussions, when you are left with a little more time and money to save, plan for your retirement together. Whether you want to retire early or later in life, discuss with your spouse and invest in PPF, NPS and other tax-saving schemes that will help you create a big corpus for the future.
Marriage is a two-person job that you will have to work on every day. And while you are at it, managing your money with your partner should be a habit so that you can grow, save and invest together.