Congratulations! You’ve taken a big step in life and with it, the commitment to share your future with your new spouse. You may not want to think about it now, but a shared future means shared finances. Think about addressing your financial situation before it’s too late. Be open about the topic and discuss boundaries, plans, and ideas to ensure your financial security as a couple. Follow these financial tips for newlyweds.
Open up and talk about it. Full disclosure of financial history, assets, and current standing can be difficult to share, but it’s necessary to establish a healthy financial relationship with your new spouse. Open up and talk about your financial situation early on to set up the lay of the land. Too many couples avoid discussing their finances, until something major happens, which can lead to feelings of regret and betrayal. As a newlywed, you’re more inclined to forgive and compromise with your partner about their money troubles, or yours for that matter. Sit down and go through your credit history, bank statements, and bills. Be practical and be thorough.
Don’t get carried away. More money doesn’t necessarily mean more money. Sure, you have two salaries to live off of now. You might feel like you’ve hit the jackpot and can buy a new car, house, clothes and furniture. But keep in mind there’s two of you and new and existing bills to pay. Try to live off one salary as much as possible. Focus on paying off student loans, credit cards, or on growing a family down the road.
Establish joint or separate accounts. Every couple feels differently about completely merging bank accounts. You’ve worked hard to earn your financial independence and marriage doesn’t mean that has to be taken away. Even though you should try to live off one salary as much as possible for saving purposes, it’s always healthy to have “bank account” boundaries. A popular trend today is creating a joint account for joint expenses like mortgage, groceries, rent and general bills. If you still crave that sense of financial independence, a solution would be to establish separate spending accounts for smaller purchases. Limit that extra cash though. You still want to focus on saving as much as possible from your combined salaries.
Save for the future. Maybe this is starting to sound repetitive, but saving truly is important. Everything can be fine and dandy one moment and absolute chaos the next. Emergencies happen, and plans change. Put money aside and create an emergency fund, which that covers at least three months of living expenses. If you are planning on buying a new home or expecting baby, save every penny you can. You should always be prepared for unexpected events. Also, think about retirement. Put aside at least 10 percent of your paycheck into a tax-deferred retirement plan while you’re still young. Too many couples find out their retirement years will be unfunded. If you plan to live comfortably, plan ahead.
Get Yourself Insured. Look into buying life insurance and make a will to protect your new spouse and future children. In the event of a life-threatening accident, your financial future may be at stake. Nobody likes to think about these things much less talk about them with loved ones. Try to focus on the positive aspects of life insurance like ensuring financial stability for your family’s future.
For more information on how credit unions can help you and your new spouse with financial planning, contact the Brownsville credit union at VFCU by calling (956) 546-3108, or the Harlingen credit union at (956) 425-5668.