Our Archive of Articles About Financial Literacy and Other Topics
Newlyweds Adjust To Shared Finances
June 22, 2007, 10:43 am
Money Management Article for newly married couples
Getting married is one of the biggest adjustments in any person’s life. After all, making that commitment to another person means giving up the “I” in favor of the “we” and how newlyweds handle the adjustment will determine how successful their marriage will be.
Naturally, there are a lot of aspects of life that have to be thought of in new terms once the euphoria of the wedding has settled down. These include living habits, social schedules, and attitudes about family. However, in poll after poll, the number one reason married couples argue is – you guessed it – money.
The problem usually occurs when there is a lack of communication about their finances. And in the typical arrangement where one spouse handles the bills, if the lines of communication aren’t wide open, a situation can emerge in which the bill-paying spouse is trying to keep everything organized and up to date while the other spouse is spending money as fast as they earn it, possibly even unaware that there is a problem.
So for recently married couples, the key to successful money management is communication and compromise.
The first step is to have a plan that both partners are involved with creating and in agreement on. And when I say a plan, I mean setting financial goals and budgeting. It’s absolutely essential to have some kind of financial goal – something specific and concrete, not just “to save money.” Without specific goals, every time you find yourself with a surplus of money in the account, the temptation is too strong to find a way to spend it.
One example of a financial goal that young couples may want to consider is paying off debts. When you’re dealing with personal finances, being debt-free is really the key to achieving all other objectives. So, determine what you need to pay each month to be debt-free by a specific date and work toward that goal. Resolve between the two of you to pay that amount, making whatever reasonable sacrifices are necessary.
Another great goal you may want to consider at this stage is saving a down payment for a house. This is the ultimate dream for most young couples starting out, but you have to manage your money effectively to accomplish it.
The other element of your plan, and also something you need to be open with each other about, is your budget. If you haven’t already done so, figure out exactly what your take-home pay is per month and compare it to a list of your monthly bills, including fixed expenses and estimates for the variable ones such as gas for your car and groceries. Most people are amazed at how much money they have left over after the bills are paid on paper. If you budget this “leftover” money toward constructive goals and stick to your plan, you’ll be able to accomplish the goal probably even quicker than you think.
Overall, communicate openly about your attitudes toward money. After the obvious essentials, what are your priorities? Living comfortably? Children? Saving for a home? Creating a retirement plan? Always having spending money on hand?
Most people develop these values way before they get married, and most likely model them in some way after their own parents. Well, now you have a partner, whose parents may not have the same values yours did. So you have to work to understand each other’s attitudes and make some compromises here and there so they fit together.
Otherwise, you may be in for a long road of arguing about why the bills are always late.
About Springboard Nonprofit Consumer Credit Management
Springboard is a nonprofit credit education and financial counseling organization founded in 1974. The agency offers personal financial education and assistance with money, credit and debt management through confidential counseling. Springboard is accredited by the Council on Accreditation, signifying high standards for agency governance, fiscal integrity, counselor certification and service delivery policies. The agency provides pre-bankruptcy counseling and debtor education as mandated by the bankruptcy reform law. Springboard is a HUD approved housing counseling agency and a member of the National Foundation for Credit Counseling, a national organization of nonprofit credit counseling agencies. The agency has several locations in California and offers face-to-face and nationwide phone counseling services. For more information on Springboard, call 1-800 WISE PLAN (1-800-947-3752) ext. 7750 or visit their web site at www.credit.org.
