Managing money on your own can be a challenge. Managing money as a couple, on the other hand, can help the process if done efficiently. However, getting it right takes strategy, especially since money is a major stressor in life. In fact, according to multiple surveys, about 40% of couples fight about money. Here are some tips on how to successfully manage money as a couple.
Always be transparent
When it comes to sharing money, transparency is key, and this begins long before saying “I do.” Before combining accounts and responsibilities, be sure to discuss your financial positions. Start a consistent dialogue so you are both always in the know. Ask questions like:
- How much money do you earn before after taxes?
- What budgeting style do you prefer?
- How much savings do you have?
- How much debt do you have?
- Do you prioritize paying off debt over saving?
Remember, starting these questions before getting married, keeping a nonjudgmental approach, and continuing the conversation after the wedding will give you the best chance at successful management of money.
Find a system that works for you
There’s no one size fits all system when it comes to managing money for couples. Some couples prefer to combine their accounts and debt, while others prefer to keep things separate. However, remember that any debt you take out jointly will be shared and both your responsibilities. In addition, in some states you will be liable for debt your partner borrows on their own, even if you are unaware of it. If you’re focusing on debt repayment, find the strategy that works best for your preferences. This could mean tackling the smallest balance first, or the largest. The most important thing to remember is that there is no right way of doing things. What truly matters is that you find a system that works for both of you.
Calculate your combined assets and liabilities
Assets are things you own that have an economic value. Real estate, cash accounts, savings accounts, jewelry, and stocks are some examples of assets. Liabilities, on the other hand, are debts you owe. Credit card debt, mortgage debt, student loans, and even a loan from a friend can be liabilities. Always knowing your assets and liabilities will give you a good understanding of what you have and what you owe. Having this knowledge can help you make realistic financial goals. For example, if your debt far exceeds your assets, you probably won’t make plans to go home-shopping or go on a vacation.
Discuss your financial goals
You should try to always have some sort of financial goal you’re working towards. This could be saving for a house, paying off a credit card, or working to increase your credit score. Whatever your goals are, discuss them with your partner regularly to ensure that you are on track to meet those goals. If you aren’t on track, discuss what changes you can make to fix that. You may find that these conversations help motivate both you and your partner to achieve your financial dreams.
Know when to ask for help
Sometimes, money and debt can become too much to manage and that’s okay. Before the situation worsens, consider asking for help. You could seek advice from a financial planner, and if the situation is weighing heavily on you, consider seeking help from a debt consultant. Debtmerica Relief has over 16 years of experience in providing relief to our clients whose debts have become too much to handle.
If you need help with debt, contact us for a free consultation.