Several researches reveal the fact that money problems are one of the major causes of divorce. So, while getting married, it should be your prime concern to keep money problems away. In turn, it will help strengthen your relation if you can successfully avoid debt problems by managing your personal finance responsibly. Read on to know how you should manage your personal finance in order to lead a financially happy married life.
Do not lie regarding financial situation
It is advisable to not lie regarding each other's financial situation. Even before you get married, you can discuss with your spouse how much you earn, your savings and the debt you'd have to pay off after marriage. The newly weds should also set financial goals. However, this doesn't mean that both of you need to have common goals but, you can work together to achieve both of your short and long term monetary goals.
Plan a suitable budget to save more
Both of you should work together to plan a suitable monthly budget. While planning a budget, it is advisable that you take into account both of your monthly income and create a common fund to manage your household expenses. Discuss with each other and decide how much each one of you will contribute to the common fund. Studies point to the fact that one spouse is always better at household bookkeeping but, it is advisable that both of you plan the household budget together. Moreover, review your budget from time to time and modify it (if required) to achieve your financial dreams and goals within your desired time period. You can also plan weekly and annual budgets along with planning monthly budgets. Doing so will help you manage your finances in a much better way.
Help your spouse to pay off debt
It may happen that one of you enter marriage with huge debt to pay off. In such a situation, the other spouse should help in paying back the debt. In this way, you can pay back the debt faster and bring the financial situation back in order. In addition, it will also strengthen your marital relationship.
Have both single and joint accounts
The newly wed couples often face difficulty to decide whether to have separate or joint accounts. It is better to have a combination of separate and joint accounts. However, to do so, you need to decide when to use the joint account and when you should use your separate account to meet your necessities. Both of you can decide which bills to pay off from the joint account. While doing so, it is advisable that you set rules to use the joint account(s) and manage them responsibly. Having separate credit cards is also necessary as one can qualify for loans in future even if the other one has credit problems. When you co-sign a credit card, it is mentioned in both of your credit reports. So, if one defaults on the account, then it has a negative impact on both of your credit reports.
Save for financial emergency
Often the newly weds fail to save for emergency. It is advisable that you save at least 10% of your joint income to build an emergency fund for the rainy day. You can use this fund to overcome financial crises without having to incur debt.
Apart from above, it is advisable that both of you save for retirement separately. This is because one spouse may withdraw from his/her retirement account, if needs arise, and the other spouse's retirement benefits will remain unaffected. So, invest in your individual or employer-based retirement plans right from young age.