Six Ways To Protect Your Marriage From Financial Missteps
Finances are one of the most stressful issues in marriage and one of the most popular reasons for divorce. It might sound terrible, but it makes sense because money is a highly personal and very important part of life. For young couples, merging your financial life the right way sets you on a course for long-term success—and happiness.
We’ve got six steps to get you off to a great start.
1. Learn how to talk about money together
Great communication is one of the best ways you can make your marriage bullet-proof, period. But this is even more important when it comes to your finances. Money will be an issue—in good ways and bad—throughout your life together, so making sure you are both comfortable talking about it is crucial. The most important thing is to make sure you’re not hiding spending from each other, so if you learn how (and when and where) to talk about money, you won’t need to.
Maybe it makes sense to set up a weekly or monthly touch base where that’s all you talk about. You may want to share how you’ve thought about and handled money in the past—and what you’ve learned from that, so the other person knows where you’re coming from, and also so you can tailor your approach to best suit both of your personalities. Decide whether the true housekeeping of finances—like paying bills, writing checks, logging spending—is going to be a joint effort or if one of you will own that piece, and if so, make a plan for how the other person will stay informed.
2. Create and share joint financial goals
Maybe you both already believe in saving for the future, but make sure you’re both envisioning the same kind of future—or that you’re thinking about the same point in the future. Are you saving for a trip to Europe in two years, while your partner is saving for retirement in 30 years? They aren’t mutually exclusive, as long as you are both aware of and working toward the same things.
Discuss how you plan to save—how much and how often money will be put aside—and the priority of the things you want to spend it on.
3. Decide if your bank accounts get hitched, too
Marriage comes with tons of financial decisions, but whether or not to fully merge your finances is one of the biggest. Whether the answer is yes, no, or not now but maybe later, clear communication is—again—essential. So is good planning.
If you will merge your accounts, how will they be managed? Does one of you take the lead or do you do everything together? If you keep separate accounts, how do you handle joint expenses like living expenses? What if your salaries are vastly different? How will that play into this scenario? These are all important but tough questions, especially when they concern life stages you haven’t even begun to think about. This is an opportunity to get the help of a Certified Financial Counselor, who can answer questions, share perspective, and help guide you to the right decision for you.
4. Make plans for tomorrow
You already know that saving is important, but it’s not quite that simple. What are you saving for and how? Savings accounts are a great place to start but also think about creating an emergency fund. And then there’s retirement to think of. Do you have a 401k plan through your job and how much are you contributing? But does your partner have one, too? Even when all your finances are merged, it’s smart to make sure you each have your own retirement account. Talk to a Certified Financial Counselor about options and what you think will work best for each of you.
5. Draw a map to get there
Budgets really aren’t as scary and stifling as they sound. In fact, creating and living off a budget might actually save your marriage. Seriously. Once your responsibilities and goals are in alignment you can create a plan that will get you there the way you want—a way that’s comfortable for both of you.
Maybe going out to lunch is important to you for your work life, but your partner would rather pack lunch and spend that money elsewhere. If you plan for it, then you don’t have to challenge (or worse, resent) each other for what you’re spending money on. A budget is important for larger purchases too—how much do you both feel comfortable spending on things like cars and homes? Discuss this and get it in your budget. Then stick to it. If you find it’s not working, sit down and discuss it, make tweaks and try again.
6. Pick the right place
Choosing the right financial institution is an important decision that is often overlooked by many young couples. Be sure to check and ask about the banking fees, loan rates, and member benefits. Over time fees can add up, and benefits only help if they are benefits you can use.
BMI FCU is a member-owned financial institution. That means that when you do your banking with us, the benefits are geared toward you, not shareholders that want to maximize profits. This keeps service fees to a minimum, and loan rates down. We also have Certified Financial Counselors that can help you keep your budget and finances on track no matter what life stage you are in.
Bringing two lives together can be a powerful and loving experience, but don’t let finances be your undoing. If you approach money with as much honesty and respect for each other as you do the rest of your marriage, you’ll safeguard it from dangerous and unnecessary stress. And if you’re not sure where or how to start, one of BMI FCU’s Certified Financial Counselors will help you get on the right track.