After the long months of planning, the long hours of celebrating with friends and family, and the far-too-short honeymoon, it’s finally over. You’re married and ready to settle into your happily ever after. One of your first acts as a new couple should be planning for your financial health. Take the time to set long-term goals, build a joint savings account, and tackle debts; use this guide to help you create your newlywed financial plan.
Discuss Your Debts
If you and your sweetheart haven’t discussed debt before the wedding, don’t put off this important conversation any longer. You’re a financial unit now, and you must be on the same page about addressing your debts. Set aside an afternoon to compile a list of the household’s outstanding obligations. Does either of you have student loan debts? Unpaid credit card balances? Car loans? Write down every single loan each of you owes. Include the interest rate, balance, and lender name. Next, make a plan to tackle debt. Do you want to pay down the smallest balances or the highest interest rates first? How much of your joint income can you set aside for debt repayment? Finally, consider any new debts that either of you is planning on accruing in the next few years, such as replacing a car or purchasing a home.
Plan for the Future
What long-term dreams do you and your new spouse share? Do you want a large house filled with a large family? Are you artists who would prefer a low-stress career that leaves plenty of time for creative endeavors or world travelers who want to work from the cafes of Paris or the beaches of Thailand? Your unique story requires a customized approach for meeting your financial goals, so take the time to create a financial road map for the next few decades. Set up a joint savings account and agree on a plan for how to reach your goals, whether that means saving up tens of thousands of dollars for a down payment or setting aside a few hundred bucks for a road trip.
Build an Emergency Fund
Financial emergencies happen all the time. Whether your car needs an emergency repair or your spouse has to fly home for a family crisis, life is full of unexpected expenditures. One of the worst things you can do for your long-term financial health is to use a high-interest credit card or payday loan to fund a financial emergency. That $500 loan you take out could easily cost you $1,000 after you’ve paid fees and interest. Instead of relying on a last-minute loan, prepare for emergencies by setting up a dedicated account specifically for crises. Cautious couples save an entire year of expenses in their account, but most newlyweds will be fine with an emergency fund amount of three to six months’ expenses. However, if you or your spouse work in a volatile or seasonal industry, it’s a good idea to save more money in case work dries up for a long period.
Consider Combining Accounts
Now that you’re married, your financial resources are legally joint property, even if you keep them in separate accounts. Many couples choose to combine bank accounts to keep things simple. Decide together if you want to combine every account, keep separate checking accounts but open joint savings accounts or keep everything separate. There’s no right or wrong decision as long as you both agree to a plan.
Appoint a Family Accountant
You each bring unique abilities to your relationship. Likely, one of you is more comfortable with money management; that person should be the one to pay bills, balance the checkbook, and monitor your financial health. Make sure that both of you are on the same page about when bills need to be paid to ensure your family doesn’t waste any money on overdrafts or late fees. Of course, to keep things fair, the other partner should take on another chore that requires roughly equal amounts of time.
Financial planning isn’t as fun as sampling wedding cakes, but it’s vital to your long-term health and happiness as a married couple. Make financial talks fun by promising yourselves a fun reward at the end, like a movie night or coffee date. By investing in yourselves as newlyweds, you’ll reap the rewards of financial stability for years to come.