It is undoubtedly essential for newlyweds to have a conversation about their finances, even if it feels like an awkward subject in the beginning. The truth is that discussing money matters is certainly not the most romantic thing to do. Still, in the long run, it helps improve the couple’s communication skills and prevents any sort of money misunderstandings in the future. On that premise, the following article presents some of the best financial planning tips that will help newlywed couples better discuss and manage their finances.
Discussing Family Financial History
Talking about the family’s financial history with money is one of the best ways to get a handle on finances early on. As a matter of fact, couples need to discuss how their parents handled money and how they were taught to save and spend money. This is crucial as it gives the couple a better idea of how they will spend, save, and pay debts as a couple.
Deciding on a Joint or Separate Bank Account
When it comes to financial management, it is also imperative for the couple to decide from the start whether they want a shared or separate bank account (or a combination of the two). That being said, there are definitely pros and cons to both options, so couples should choose the option that makes managing their finances a lot easier.
Creating a Monthly Budget
Once the couple is married and living together, they need to create a monthly household budget. This includes creating a list of all the expenses, plus any recurring expenses. This will help the couple have a better understanding of how much they should bring in on a monthly basis and avoid overspending and tackle debts.
Starting an Emergency Fund
In the long run, couples will not regret starting an emergency fund after they are married. Indeed, putting cash aside is a great way to be prepared for unexpected occasions or problems.
Planning for Retirement
As retirement is going to be a big part of a couple’s marriage, they should plan for it by putting money in a savings account on a monthly basis.