Money matters: Tips to avoid financial issues from straining your marriage
ONE of the leading causes of stress in a marriage can be attributed to money matters. Keeping your spending objectives and financial habits hidden from one another can only strain your marriage. Some people spend hundreds of dollars on food and beverages alone in a month, while others prioritise video games before saving for a new car. Whatever it is, discussing finances as a couple, such as how to manage, deal with debt and how much to save, is vital to maintaining a good marriage.
Here are five tips on how to avoid financial issues from straining your marriage:
1) COMMUNICATE REGULARLY
Carve some time out with your partner for a judgement- and criticism-free discussion on finances and do it regularly. Different people have different habits and priorities, so it’s important that both partners communicate openly and be open to compromise. Be honest and work through it with your partner. Allow mistakes to happen from time-to-time because old habits are hard to break.
2) BUILD AN EMERGENCY FUND
How many times in your life has something popped-up unexpectedly that cost you thousands and more? Add kids and pets to the picture and the list of potential extra expenses can wreck a hole in your pockets. During an emergency, the last thing you want to do is fight with your spouse about debt and finances. Plan for the unexpected and create a sizable emergency fund according to both of your specific needs. Take into consideration your family’s health concerns and condition, job security, and transportation needs. When life throws you a nasty curveball, you can relax knowing that you’re in good financial shape to weather the storm.
3) OPEN AN EXTRA OR JOINT ACCOUNT AND SET UP AUTOMATIC PAYMENTS
Don’t be one of those couples who forget to pay their bills because they thought the other person was doing it. If you can, automate your payments for all household related expenses such as mortgages, auto-loans and monthly utility bills. Allocate bigger expenses like vacations, or your dream kitchen into the extra account as well. Lastly, what’s left should go into your respective personal accounts. If one member of the household earns more than the other, ratio your salaries and agree to a set amount to which each partner contributes to the joint account.This ratio should obviously change as incomes change.
4) TRACK YOUR SPENDING
This goes without saying you need a budget for all of your spending. Even if you won the lottery, you’d still be better off with a budget! Eyeing that 4K UHD Smart TV but not sure if you can afford it? Most people would go ahead with the purchase thinking, “Hey, it’s all good, I’ll make the money later” without giving a second thought to whether they can afford it. When financial stresses start to creep in, the blame game will begin and its not fun!
Budgets restrain us from doing things we like, so frankly, it’s painful. The tip is to start small by tracking your expenses without setting any restrictions on your spending. Over the course of a couple weeks, look back at your tracking spreadsheet to see what areas are holding you back. Start restricting and changing your habits little-by-little. For example, stop buying that cup of coffee every day and instead make one at home.
5) HAVE A FINANCIAL PLAN
It’s never too early to talk about your retirement and savings goals. Make it fun! Talk about your dreams, whether it be cruising down the Caribbean or having a small house by the sea.This goes hand-in-hand with having a budget, so you know exactly how much you need to sustain yourself to live a content lifestyle. Being aimless with your savings means spending unnecessarily and out of budget. When that happens, you’re much more likely to run into financial problems.Its never too late to speak to an accountant or financial advisor about your family's financial plan. A good rule of thumb is to start by saving at least 10 per cent of your income. Whichever way you decide to manage your finances, it’s already a good start if you're saving and planning for the future.
