You've found the love of your life, so chances are you've discussed your past, present, and goals for the future. What some couples do not discuss, however, is their finances. It's a touchy subject, but it's necessary to talk about since you'll be spending the rest of your lives with each other. To get some advice on the subject, we asked Marlow and Chris Felton – a husband-and-wife duo who help couples get on the same page financially – for their tips on making the first year of marriage as blissful as possible when it comes to money matters.
Read their opinions below:
Photo by Marisa Holmes; Bridal Gown by Monique Lhuillier
It’s summer wedding season and many couples are tying the knot. Compatibility is in the bag, but what about the nitty-gritty financial details of your new spouse? It is a sensitive topic, and one many couples don’t touch until years into a marriage when they must.
Avoid the pitfalls, and take the first step now. Keep an open mind, because sometimes people themselves run from their bad monetary situations. These tips will increase financial compatibility between newlyweds:
Yours, Mine, and OURS
Start viewing money and income as ours. You are a partnership now, and that includes making money for the “team.” Even if one works as the breadwinner, and the other has all the debt in the world, it belongs to you both. Marriage brings you together as one, and that includes your finances. Separate bank accounts and expenditures leads to distrust and arguments. Avoid this by communicating as soon as possible about money and bank account plans.
Have a “FUNd”
Keep fun money separate. The only time it is beneficial to the couple to keep money separate is for fun activities. We like to call this the “fun fund.” Pull a percentage aside each month from what you both collectively make as income. This can be cashed in monthly for sports events or concerts. Also, you can split it to use how you both wish. If she wants to go shopping and you want a round of golf, it is perfect. The other option is to save it for annual or semi-annual vacations.
Prioritize Your Partner’s Priorities
Know how your partner likes to use his or her money. Understand their reasons and priorities to avoid judgement. Many people’s motivations are different and those need to be communicated when you are sharing funds. Most of these differences revolve around philosophies about spending and saving. Discuss and draw up realistic reasons about what you need and what you can live without. There may be sacrifices from both parties, so be ready to let that weekly blowout go by the wayside.
Money and finances are often a game of physiological chess; your mindset matters. You may be living on different financial planets, but settle with understanding each other’s motivations and mind-sets. When one individual has a negative money relationship, it can result in struggle and shame. Couples who are positive in their relationship with money tend to be better off financially.
Talk About the Big Stuff
We all grab a quick coffee here or get lunch with a friend there. These purchases oftentimes don’t need approval from your spouse. When you are thinking about a larger purchase, such as a car, that is not something to act on impulsively. Mull it over with your significant other, and decide what’s best together. This is a communication exercise as well as a financial one. Blindsiding someone with a new Tesla in the driveway is not the best idea, especially in the early days of sharing finances.
Save Some Slack
Live within your means, but don’t forget to have fun – you are newlyweds after all. Make sure to cover your bills and necessities, but budget realistically for entertainment, vacations, gifts, and the rest. It is most important to plan and allocate specific funds for this purpose. Don’t deprive yourself as that leads to impulsive overspending later. Think of it like a diet: when you cut out too much, you then overcompensate later.
Have a savings established for the worst-case scenario possible. You never know when someone might fall ill or have an accident. If one of you were to die, how would that impact your financial situation? No one wants to think of the worst, but it is good to have a safety net if something tragic happens. Consider life insurance for your loved one. Create a will together when the time feels right. When you are young and healthy is the best time to plan for the unforeseen future. Once you do it, you can forget about it until it is necessary.
A Teaching Moment
Whether you have children or plan to one day, mutually you both need to decide how you will discuss money with them. Regardless of your own relationship to money, your children should be introduced to the concept positively. Start early to teach them about earning and responsibility. You and your spouse should discuss important financial principles you each want to pass on to the next generation.
Think of the Future
What are your long-term goals and dreams? More important: do you know how you’re going to get there? A couple needs to be clear on what they want their life to be like together five, 10, and 20 years from now. How much will that cost? What is the shortfall and what is the plan? What are their retirement goals and how much will they need? Many brides and grooms go wrong when they’re young by not looking to the future. They think they have their whole life ahead of them. Unfortunately, life passes quickly, so it’s wise to start planning as soon as you can.
Couples experience financial strife, and it is no oddity to us. At one point, we have all been there. Start with an honest and open mindset about financials from the onset of your marriage. Honesty and collaboration are pillars of a successful relationship and life together. Best of luck!
Marlow and Chris Felton are authors of Couples Money and The Prosperity Factor, and a husband and wife team who help couples get on the same financial page.