Before you say “I do,” it is important to discuss with your soon-to-be husband/wife how you will manage money as a married couple. While this topic can be uncomfortable, getting the right answer can lead to a successful marriage and one that is full of financial freedom.
In this guide, we will discuss the various ways a newly married couple can adopt to manage their finances properly. Keep reading to learn more.
Newly Married Couple Managing Money With Separate Accounts
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During the first months of their marriages, most couples prefer having separate accounts as they do not have a lot of shared expenses yet. Also, when you move in with your partner, there is a chance that your income figures could vary. Therefore, separate accounts can help you and your partner split expenses based on how much each earns.
So, what are the pros and cons of managing money using separate accounts as a couple?
Pros: Each partner is responsible for spending habits and settling any debt they brought into the marriage. Additionally, if the couple is happy with how the shared bills have been split, then separate accounts can be considered a “fair” money management technique since the spouses are less likely to argue over the spending habits of one another.
Cons: Money management through separate accounts can be challenging if the couple is blessed with a kid or one spouse decides to change careers.
Newly Married Couple Managing Money With Joint Account
If you want to simplify money management as a newly married couple, then having a joint account is recommended. With this account, you don’t have to split bills with your spouse. Instead, all expenses are settled using the family account. A joint account also makes it easy for couples to use online budgeting tools, which simplify the process of tracking expenses.
Here are the pros and cons of using a joint account as a newly married couple:
Pros: Joint accounts allow couples to work together toward achieving shared goals. And as mentioned earlier, such accounts make tracking of spending easy.
Cons: A Couple might always get into arguments over spending habits of each.
More Money Management Tips for Couples
There are several things that you and your spouse must consider as you start your married life. Among the things is joint goals. You need to sit down and set goals, then plan how to achieve them together. Once this is done, you can decide to open a savings account and automate monthly deductions from your salaries to that account.
Also, it is vital to discuss bill payments. The question of who pays which bills must be answered to avoid conflicts. Once you agree, automate these payments.
What’s the 50/30/20 Rule?
This is a budgeting rule that involves dividing your monthly income into three groups: needs (50%), wants (30%), and savings (20%). Needs are all the bills that must be paid every month for one to survive. They include rent, electricity, water, and groceries. Wants are those things you can do without, such as tickets to music concerts and eating out. As a newly married couple, it is advisable to adopt the 50/30/20 rule to allocate your income.
How Second Marriages Handle Finances
If you have been in a marriage before and had an unpleasant money management experience with your previous partner, you may want to enter a financial agreement with your new spouse to set out rules on how finances will be handled to prevent repeating mistakes.
What’s Financial Infidelity in Marriage?
When spouses lie to each other about their finances, that is called financial infidelity. For example, your partner can lie about an existing debt. Moreover, financial infidelity can happen when a couple opens a joint account, and one spouse decides to make an expensive acquisition without informing the other.
There’s no right method to manage your money as a newly married couple. However, with planning and transparency, spouses are likely to have marriages without money-related conflicts.