Did you recently walk down the aisle? Whether you, your parents, or your in-laws footed the bill, you must have caught a glimpse of how much money it takes to throw a wedding celebration. Now imagine yourself twenty years down the road. Will you have the necessary funds to pay for the monumental events in your children’s lives?
Acquiring the necessary financial management knowledge and learning how to successfully budget is a vital part of a healthy, sustainable marriage. Although managing money may be trying at times, it’s a terrific way for you and your spouse to bond and plan for the future together—a future that can include car and mortgage payments, tuition, travel expenses, and children’s needs.
We’ve compiled a list of money management steps you can take to help you and your spouse start out on the right foot financially. Follow these steps together so you can learn to earn, save, and spend your money as a couple.
1. Talk Finances
Although finances can be a tricky subject to talk about as a couple, it’s important to discuss your finances with your spouse as soon as possible. How much money do you have in your bank account? Share this number with your spouse. Ask your spouse to do the same.
If you’ve entered into marriage with debt, don’t hide this information from your spouse. Talk about your debt so you can work through the financial hurdle together.
Another point of your initial money management discussion should involve talking about expectations. Does your spouse expect you to discuss any purchase over fifty dollars? What do you expect when it comes to your spouse’s spending habits? Be open when it comes time to set boundaries and make financial goals as a couple.
2. Make Goals
What financial goals do you and your spouse share? Do you want to buy a house or car? Pay off all debts before you start a family?
Sit together and write down a list of both short- and long-term goals you can accomplish together. If you’re planning on buying a house in the near future, make sure you discuss the financial steps and sacrifices that will help you obtain that goal.
3. Build a Budget
Determining a suitable budget and sticking to it may seem like an obvious step when it comes to money management. But as simple as it is, budgeting is an essential part of saving and spending, especially if you intend to save enough money for a down payment on your home or car.
Although determining your and your spouse’s budget can seem overwhelming, it’s not incredibly difficult.
- First, sit with your spouse to determine how much you both contribute to your bank account each month.
- Next, write down all of your expenses, including rent, insurance, car payments, groceries, and gas.
- Lastly, determine how much money you want to save and subtract your expenses from your joint income.
Remember, it’s always wise to allocate funds for unexpected expenses. Budgeting is a work in progress and will change depending on your and your loved one’s changing circumstance. Be prepared to make adjustments to your budget during every phase of life.
4. Stick to a Budget
Once you’ve built a budget, it’s important to stick to it and track your progress. However, this is easier said than done. If you’ve never tracked a budget before, try the envelope budgeting system:
- Create a separate envelope for every budget category (rent, insurance, car payments, groceries, gas, dining out, gifts, and entertainment allowance).
- After you receive your paycheck, put in the budgeted amount of cash.
There’s one rule to the envelope budgeting system: you can only use cash.
If this system seems a bit too complicated—or outdated—for you, try one of the following apps to help keep track of your monthly budget:
Budget tracking apps are a convenient way to keep track of how much money you make, spend, and save each month.
Don’t let money management frighten you. Instead, sit down with your spouse to discuss your finances, make goals, and build a budget. Hold one another accountable when it comes time to track your budget and make sure you’re on track to obtain your financial goals as a couple.
Talk with your local mortgage broker if you need help determining how much money you’ll need to make one of you and your spouse’s biggest purchases—a home.