Love and Wallets: Financial Planning for Couples
Navigating finances as they run like a river through the twists and turns of relationships can be both challenging and rewarding. Whether you’re scheduled to hear wedding bells in the near future or have been partners for years, good financial planning can help build more security into your life. Here are five tips for managing finances as a couple:
- Set shared goals: Use common financial goals that can bring you together as a couple. Identify your life goals. Whether it’s buying a home, investing in education for yourself or a family member, planning your retirement scenario or building up for a career move, setting mutual goals will help you get on the same page and stay there.
- Create a joint budget: Create a budget that accurately reflects your combined income, savings, savings goals and expenses. Make sure you allocate responsibilities for bill payments and savings and come to an agreement on discretionary spending. Life circumstances do change, so change your budget if you must, but make a commitment to stick to the budget you agree on. Budgets won’t work if you don’t use them.
- Establish autonomy: Yes, we did just tell you to make a joint budget and stick to it, but every relationship needs a certain amount of leeway. Discuss and come to an agreement on how much you trust each other to spend. Making a large purchase without consulting other family members can lead to disagreements. However, there are times when you need to make purchases, but it is not practical to consult with your partner. To establish autonomy, you need to decide how much leeway is reasonable.
- Build an emergency fund: This is sound advice for anyone but has additional importance in a relationship. All that work you did building a budget and the discipline it takes to stick to it can be blown up if an emergency hits you. An emergency fund relieves the pressure of having to scramble and figure out how to pay for unexpected expenses. An emergency fund can help you make more clear-headed decisions.
- Communicate often: Communication is the cornerstone of any relationship, and your finances are no exception. Schedule regular talks to revisit your goals and see if anything has changed. Revisit your budget and update it to reflect your financial situation. Be transparent about your financial histories and spending habits. Open communication can help each person understand the other’s perspectives and avoid misunderstandings.
Whether you need help planning education savings, asset management, retirement, or even trust and estate planning, Cadence Bank Wealth Management can help.