Marriage is a partnership in every aspect of life and while it may not seem romantic, money plays a big part in a marriage. So, whether you're in the midst of planning your big day or are newly married, it's important to decide on a money-management strategy that's right for you and your spouse. Understanding each other's financial history and setting goals with one another will help create a strong foundation for things to come. Here are a few financial tips to help you get started on the right foot.
Share Your History
Talk to your spouse about your financial habits and situation. Be honest and break it down. You should know about each others savings and spending habits, the bills that come in, debts owed, credit scores, and other day-to-day financial information.
After you've broken it down and identified where you both are financially, start setting goals for the future. Talk about where you want to be — do you want to buy a house, what are your retirement goals, do either of you plan on going back to school, or do you plan on having kids? After discussing your goals for the future, create a budget for yourselves that will help you to meet your goals and also let you pay off any immediate, high-interest debts.
Prepare for Emergencies
While you and your spouse are planning and saving for your goals, you should also prepare for rainy days. Set money aside for an emergency fund. You should strive to have at least three to nine months' worth of expenses set aside in case of major home or auto repairs, medical emergencies, job loss, and other large expenses. Automate your savings by having a portion of your paycheck(s) directly deposited into an emergency savings account.
Map it Out
As you discuss your financial history and share your goals for the future, determine how you'll manage your finances as a married couple. Determine if you'll keep your money in seperate accounts or maintain any joint accounts. Talk about how bills will be paid, who will handle which tasks, and where you'll store important documents and financial information.
Think About Taxes
Having a change in your marital status can affect your taxes. Take a moment to review this IRS tax checklist for newly married couples so you and your spouse know what to expect.
In order to stay on track, it's key to continue communicating with your spouse open and honestly. Discuss your financial matters regularly and determine if the financial plan you created initially is working. If it isn't, discuss what changes can be made to create a plan that works for you as a couple.
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