Marriage works best when personal finances are in place.
As young couples give lot of mind to managing their new lives together after wedding, the monetary part gets pushed aside at times, although for the time being. But postponing monetary preparation can come back to bite later.
The couple believe they are young and have lots of time to bring their capital in place. But this is the biggest mistake they make. Personal money decisions linked with cost management, savings and investments must be made together at early stage.
Below are the tips, which will assist young couples in managing their capital in a better way.
1) Share your goals
Most of the personal money problems crop up, when partners do not share about their individual and common goals and devise strategy to attain them. Living standard of both the partners may differ. As reserves are limited, it is better to share each other’s ambitions and set priorities. Like for example, if one of the partners may wish to live in a big house, whereas the other can adjust in a smaller one but stresses on spending on yearly holidays overseas. By discussing amongst each other, the couples can arrive at a compromise for common targets.
Alike other features of wedding, funds are best managed when both the partners work as a tem and seek advice from each other. Any vital expenses decision beyond a certain limit should be taken together.
2) Control your spending
a) Plan your expenditure
Make a list of monthly expenditure to track where your money is going and budget the same accordingly. Curtail your non-committed expenditures like dining out and entertainment costs by below 20 percent of your total expenditure.
b) Handle your debt
Young couples with double income flow increase debt as they are at ease handling it at present stage. But, in future circumstances, like the arrival of a baby or any one spouse taking break from job, can affect debt-repayment and consequently young couples fall into the debt trap and elevate further loans to repay the current debt. So, you must be aware of the impact of debt on the future cash flows.
3) Safeguard your future through savings and investments
Young couples handle joint funds for the first time and often give less significance to savings and investments. As compared to later stages of life, the non-refundable earnings are higher in early years of wedding. As time passes expenditures also are liable to increase with events like buying of first house and arrival of children. Even if income is not much in the early stage of marriage, savings must not be placed on the back-burner. Continuous small savings will add up and protect you at the time of crisis.
a) Saving habitually attract the power of joint profits. The worth of savings increases with time.
b) Bank for crisis situations by pushing some amount of liquid assets. This proves to be a self-insurance and safeguard your funds at the time of emergency.
c) Choose a health insurance to finance medical expenditure and hospital costs.
d) Prepare to save in a diversified assortment and regulate the allocation with the passage of time to go well with the change in jeopardy.
Marriage works best when personal funds are in place. So, newly wedded or couples thinking of getting married must mull over preparing their finances early.
