5 tips for couples to keep your cash under control
Love and money can be a messy mix. While love is said to be the most important part of a successful marriage, money is often a leading cause of divorce. Whether you’re about to say “I do” – or perhaps money problems have you thinking “I don’t anymore” – here’s 5 quick and easy ways you and your partner can stay smart about your cash and avoid the hassles and arguments that money can create.
- Communicate about cash
Form good habits and communicate openly about money from the start.
- If you’ve been able to make a decision as important as spending the rest of your lives together, you should trust each other enough to share financial information such as how much you earn or have in savings, and what debts you might have.
- Make a list of of your loans and debts – perhaps consider obtaining a free credit report each that will detail all of your accounts and ensure you don’t overlook anything.
- This way you’re both aware of any outstanding debts and can factor them into your joint budget and when planning for future goals.
- Remember the golden rule – treat your partner as you would like them to treat you. Hiding your finances and keeping secret accounts from your partner is likely to get discovered eventually, causing huge damage to your trust and your partnership.
- Start your lives together by being honest about your finances and putting it all on the table.
- Get yourselves on the same page
It’s important you understand each other’s values and goals when it comes to money.
- If one of you is a committed saver while the other is constantly blowing their cash on impulse purchase, things are bound to blow up sooner or later.
- Understand your partner’s money mindset. Put some fun into analysing your money management personalities by taking a quiz which can help get the conversation started and identify any areas where you might need to compromise.
- It’s important you understand each other’s financial goals – both as a couple and for yourselves. Perhaps you want to get a debt paid off, need a new car or want to start saving for a home together.
- You don’t need to be 100% agreed on everything, but if you can discuss and agree on short and long term goals, managing your money will be much easier.
- Having an agreed approach to your spending will take the hassle out of everyday financial decisions, from grocery shopping, choosing a restaurant, and deciding where you can afford to live.
- Don’t set yourselves up for disaster
The message here is simple – live within your means.
- You might want the wedding of your dreams, that fabulous big screen TV and leather lounge, or a romantic resort holiday. But be honest with each other, and your budget.
- Support each other to help keep your spending and financial decisions on track. Don’t blow all of your cash on items and experiences that are beyond your means.
- Spending on smaller items adds up fast too, and can be an even bigger problem over time.
- So while you might really want those fabulous new shoes or the latest gadget – try to resist temptation and focus on your joint financial goals. Don’t lie about or hide your spending – it’s important you and your partner are open and trust one another when it comes to money.
- To join or not to join – accounts, that is
Combining finances is no simple matter when people marry.
- One or both of you may be a student, unemployed or on a low income, or perhaps is entering a second marriage and need to make regular child support and alimony payments.
You’ll need to discuss and decide on what works best for you. Will you have just one joint bank account for all of your income and expenses, or will you start with three accounts – his, hers and ours?
- It’s certainly not essential to have a joint account, but if you’re both happy to it makes a lot easier and simpler. You’ll spend less time worrying about and managing money, and more time enjoying your relationship.
- Another good option is to use three accounts: yours, theirs and a joint account. Any money you each earn goes into your own accounts, and you each transfer an agreed amount or percentage to the joint account for shared expenses.
- Or if only one of you has an income, consider having the earner’s income deposited into the joint account, with an agreed amount each then being transferred to each of your accounts for your individual needs.
- Remember the ‘B’ word
There’s no sexy way to say it – but a budget is essential. It’s the simplest and most effective way to create a financial snapshot and create a spending (and saving!) plan you can stick to.
- Use our 3 quick steps to set a budget post to set your joint budget.
- Remember to record all the money you each have coming in. This might include income from full time or casual work, Centrelink and government benefit payments, your pension or child support payments.
- Also identify all the expenses you each have, from rent, bills, groceries, transport, child care fees or child support payments, entertainment, and anything else you spend money on.
- Your budget will give you a clear picture of how much money you have coming in and out, and what you might have left over to save for your goals.
- This way, you know you both have your eyes on the same prize when it comes to your cash.
Take the time to get yourselves on the same page when it comes to cash and sort out any hassles as they arise. You’ll save a lot of time arguing about money, leaving you to get on with having fun and achieving your dreams together!