Numerous people say that money is not capable of purchasing happiness, but when you are married, managing money is definitely going to go a long way. There is no doubt about the fact that managing all your money before you are married is extremely difficult because you have to take care of everything alone. However, when you have a partner, you can be assured that both of you are going to be equally involved in the financial decisions and hence managing money is not going to be so much of a problem. However, you need to be sure that your plans and mentality are matching the mentality and plan that your partner has. This is why it is a good idea to discuss finances before you get married.
Given below is a checklist that you should take care of so that your partner and you can enjoy financial bliss after marriage.
Giving the financial checkup to yourselves
Most of the couples prefer not to talk about finances before they are getting married. However, this lack of important financial knowledge is going to be extremely risky as the mistakes that have been made in the past can greatly affect the future that both of you have together. It is crucial that you know the financial situation of each other. This includes the total number of credit cards that both of you have and the manner in which you both prefer spending money. Discuss the various activities that you both love indulging in before you are walking down the aisle. You need to get a proper grasp on the spending habits of your partner and make financial decisions as to how you are going to merge the money once you are married.
Understanding the debt of your partner
You need to have a clear idea about the debts of your partner and what they look like before you decide to combine the finances. You can also work together on clearing the debts first in order to start a happy and debt free life. Until and unless you are clearing all the loan amounts, it is best to keep the finances separate. For instance, avoid opening joint accounts and adding or co-signing your partner as the authorized user. You will require a single proper credit history so that you do not face any kind of problem in the future. 38% of the total households in the US have debts, as stated by www.forbes.com.
Saving money for your wedding
As soon as you are announcing the engagement, it is your duty to start saving money for all the expenses of your wedding. If you are already saving a certain amount of money at the end of each month, it is suggested that you try to increase the savings so that you can spend it on your big day. Even if your parents are paying for your wedding, it is crucial that you save money for after your marriage for maybe your honeymoon or if you are purchasing to get a new and beautiful home. Or, you have the option of using this money in the future for some other important aspects. No matter what you do, saving money is crucial.
Create a proper budget by fitting in the needs of both your spouse and you
You need to get all the bills as well as the paperwork together and try to put everything on your table. Calculate the total amount that you are going to owe at the end of each month. Have a clear idea of the total income that you have, the total money that you are going to spend, and the amount that is going to be saved after all the payments are cleared. You cannot ignore the potential expenses of your honeymoon or some other important aspects. It is also crucial that you set a spending limit for both yourself as well as your partner. Also, both of you need to be clear that you are not going to spend any money without the consent of each other. And if you do spend money without talking to your partner, ensure that you are letting him or her know at the earliest.
Deciding who is going to manage what
Dividing the financial responsibilities is probably one of the most important tasks that you need to take care of after you are getting married. It is a great idea that both of you play a part when handling the finances. For instance, you can take responsibility for the daily bills while your spouse can take responsibility for the long term plans for investment as well as the retirement plans. Irrespective of the financial responsibility that both of you are going to handle, it is crucial that you discuss everything with each other so that it becomes easier for you to tackle the financial decisions.
Deciding whether you are going to combine your accounts
There are various ways in which money can be managed after you are married. Therefore, it is your responsibility, to understand the different options that you have and figure out the method, which is going to work in a perfect manner, for both you and your partner. You can consider opening joint accounts or you also have the option of linking the individual accounts. If you want, you can also continue with the separate accounts. It is going to be a personal decision, and therefore, you have to consider all your options and decide on the one that is going to be perfect for the lifestyle that you are leading.
Updating the beneficiaries
As soon as you are married, you can update the name of the beneficiaries, and enter your partner’s name. This will ensure that in case if anything is happening to you, your partner is going to receive the money.
Conclusion
Having clarity about the financial condition of each other before you are getting married is crucial. Ensure that you take care of all the tips that have been mentioned so that you do not have to go through any financial heartbreak in the future.
