Working together as a couple to grow your finances should be a priority. You may have separate income streams, but as long as you want to grow a family together, you have to figure out how to manage money as a couple and build a stable home.
Long before I met my partner, I had a series of money questions I had prepared to ask by the time we got married. I knew there was no way the family could thrive financially unless we put our heads together to make it work.
In this post, we will examine various real-life strategies that can help you and your married partner manage money effectively, build better financial goals, and secure the future of your family.
So, before you embark on any major financial goal as a couple, here’s an opportunity to get it right this time. Without any further ado, let’s dive right into it.
What Does It Mean To Manage Money As A Couple?
Managing money as a couple is a beneficial situation where you mutually share ideas and take necessary steps to spend wisely, save towards your financial goals, and avoid making big money mistakes. By doing this, you can lead your family into a financially stable life.
Tips For Talking About Money In A Marriage
Sometimes finances can be a delicate matter to discuss with your spouse, especially when they have money beliefs or myths that are entirely different from yours. Hence, it’s important to go about this discussion the right way. Here are some tips to help you:
1. Be Completely Honest
Your financial situation is one of the most essential aspects of your life. It largely contributes to your happiness and peace of mind. This is why you must never lie to yourself or your partner about your finances. When it’s time to talk about money as a couple, don’t be skeptical about what to say and what not to say. Be completely honest about the situation.
For example, if you took a loan without informing your partner or even before you got married, be truthful about it. If you have some savings stashed somewhere, say it. Honesty is one of the bedrocks to help you learn how to manage money as a couple.
2. Don’t Make It A Big Deal
Talking about your finances is very important, but that doesn’t mean you should make it a big deal.
Here’s the thing… you don’t have to wait until it’s time to send your kids to college before you sit your partner down to discuss money. Money is a part of your everyday life. This means you must talk about money as often as possible. Hiding certain things about your finances is what makes this a big deal.
So, free your mind, relax, and don’t hesitate to talk about your finances and ask questions when you need to.
3. Agree To Disagree
You and your partner will not always want the same thing. Remember you’re two different individuals with different personal goals aside from the basic things you want for the family. Hence, there would be disputes concerning how money is spent sometimes. This is why I highly recommend that you patiently think things through together before making a decision.
Even though you don’t agree at first, analyze your options carefully, see the pros and cons, and end up making a decision together. This is one of the most overlooked tips for managing money as a couple.
4. Recognize Each Other’s Strengths
Understanding what makes you different from your partner is important because that is where you begin to identify their strength and the areas they are good at when it comes to making the right money decisions.
For example, you might be impulsive when shopping, while your partner is a careful spender. On the other hand, you could be good at keeping a record of your expenses and managing important paperwork.
Apparently, you both may not be perfect human beings, but there’s something you both are good at. You and your partner have to rely on each other’s strengths while trying to figure out how to manage money as a couple.
3 Money Topics To Discuss When Managing Money As A Couple
When discussing money with your partner, it’s important to focus on certain key areas of your personal finances. This helps you to carve a directional approach to solve a problem. Here are three money topics to talk about when managing money as a couple:
1. Children’s Education
I don’t think you want your kids to apply for student loans when it’s time to go to college. That would only prepare them for a life of debt as soon as they get out of school. To prevent this, you have to start planning for their education. This should be one of the essential things to talk about as a couple if you want the best for your kids’ future.
Set up the right savings account that enables you to gradually contribute tax-free money toward your children’s college education.
2. Retirement
Your retirement is one important reason you must learn how to manage money as a couple, especially if you are interested in leaving the workforce early. When you discuss and make this one of your financial goals, it will serve as a source of motivation that encourages you to manage your finances wisely.
If you think you shouldn’t be talking about retirement because you are a very young couple, you are very wrong. The fact that age is on your side is the main reason you have to start planning now. It is an opportunity you’ll never get again.
Set up your 401(k) accounts and find safe investment options that can grow your money significantly over the years.
3. Debt Payment
Many families think they can’t be affected by debt because they don’t have a mortgage, auto loan, or student loan to pay. However, as long as you use credit cards, you should be worried about debt just like everyone else. This is because learning how to manage money with your partner can be difficult if you both have to pay down your credit card balances every month.
Debt has a way of putting a limit on how you use your financial resources. For instance, if you have to clear several debt balances every month, how will you save toward important financial goals like retirement, your kids’ college education, or even an emergency fund?
10 Tips For Managing Money As A Couple
Are you ready to work with your partner to take your finances to the next level? Here are 10 helpful strategies you need:
1. Combine Your Income
Combining your income simply means you deposit your paychecks into a single account irrespective of who earns more money. For this work, you need to trust yourselves and have healthy spending habits in line with your financial goals. You shouldn’t be a spendthrift while your partner is frugal. There would be conflict and that would defeat the goal of working together.
So, if you are going to learn how to manage money as a couple by combining your income, develop the self-discipline to spend wisely and make rational financial decisions.
2. Create A Joint Account
You can’t combine your finances without a joint account. So, as one of the tips to manage money as a couple, set up an account where you deposit most of your money. Basically, this is where you spend from, especially with purchases that concern your home and family. However, this doesn’t mean you shouldn’t keep your individual accounts.
Having your own account is still important because you will always have some very personal goals. Your joint account should cater to expenses like rent, utilities, groceries, childcare, and other household bills.
3. Go Dutch
This is one of the common ways to manage money as a couple. It’s a simple scenario where all basic expenses are equally split instead of contributing money to a joint account. Other things like student loans and consumer debt should be separated as well.
One of the reasons I recommend this is in case of a breakup, so that one partner doesn’t feel like they have been brought down financially by the other. This method is also important since it reduces the pressure to keep up with your partner. You can still have a shared vision but operate from separate pockets.
4. Build A Budget
You can’t learn how to handle finances as a couple if you fail to build a budget every month.
A budget is like your drawing board, the blueprint for how your income would be spent throughout the month. This helps you and your partner to plan for all your basic expenses, save money, and pay down debt without living beyond your means. As long as you stick to your budget, you can be certain that you aren’t overspending or mismanaging your money.
Also, budgeting is very important because it helps you to hold each other accountable as a couple. This is because when you create a plan for how you want to spend your income as a couple, it’s easy to figure out when one person is operating outside that plan. As you honestly try to spend according to the budget, you will manage your money effectively.
Besides, in case you don’t know how to build a working budget, you can go through this post where I outlined the 5 basic steps for budgeting.
5. Have A Slush Fund
A slush fund is the extra money you reserve to satisfy your cravings occasionally. For instance, if you love to order a large chicken pizza and bottles of beer on weekends, you run to your slush fund. This means you don’t have to break your budget or make buying decisions that could upset your partner.
However, you and your partner have to mutually agree on how much would be kept aside as a slush fund for your miscellaneous spending. If you happen to exhaust this money before the following month, you know better than to tamper with your budget. This is one of the best strategies to manage money as a couple.
6. Be Transparent About Your Debts
If you were owing debt before you got married, chances are that your partner would join you in paying it off. This is the main reason you must be truthful about it. Let your partner know how much you owe, so you can both develop an effective debt payment method to resolve the situation.
Hiding debts from your partner is only a temporary solution that would make the situation even worse later on. So, if you have any debts, it’s time you started talking.
7. Work As A Team
Being a couple actually means you are supposed to work together to build and grow the family. The same way you work as a team to raise your kids is the same way you learn how to manage money in marriage without leaving the weight to just one person.
To work as a team, you need to identify the areas where you can individually contribute to your financial growth. For example, if your spouse makes more money, your contribution could be seen in terms of managing the family’s resources, making on-time payments, and ensuring that both the long-term and short-term goals of the household are met.
8. Understand Your Unique Personalities
Everyone has a different money mindset, including you and your partner. If you must learn how to manage money as a couple, you need to recognize the difference in personality.
For example, you might be the nerd who’s very comfortable working with numbers, while your spouse may prefer to work with digital tools that make an assignment easier. What do you do in this situation? It’s simple! You just have to actively contribute to the growth of your finances from a position you’re both comfortable with.
Recognize each other’s unique input without criticizing or expecting each other to handle things the same way.
9. Keep Purchases Out In The Open
As soon as you decide to learn how to manage finances as a couple, it means you should be willing to do everything together, including spending. Now, I’m not saying you have to go to the grocery store together, visit the car wash at the same time, or make cash withdrawals together. However, buying decisions must be made together. This means whatever purchase you make, your partner must be aware.
It doesn’t matter if it’s something personal or a household bill. You should always discuss it with your spouse. Aside from the fact that this builds trust, it makes you accountable to each other.
10. Use An Efficient Finance Management Tool
One of the new secrets to managing money as a couple is to use a financial app to get your finances back on track. Apps like QuickBooks, Mint, and Nerdwallet make it very easy to track your expenses, curb spending, build a budget, and make payments on time to avoid late fees.
Technically, a good financial tool can manage your money on your behalf. You don’t have to wrack your brain or deal with too many numbers and paperwork. Besides, some of these apps are free to use and they are available on both Android and iOS devices.
By the way, if you need a list of the best budgeting apps for couples that are free to use, check out these 10 best budgeting apps for couples to manage money together.
Recap: How To Manage Money As A Couple
Initially, it can be difficult to make financial decisions together as a couple. This is because everyone thinks they know what’s best for the family. But instead of allowing your dispute to be prolonged, you need to understand each other’s point of view and arrive at a conclusive decision. This is where you agree to disagree as you learn how to manage finances in marriage.
Besides, this post has explained some of the best tips that will help you succeed financially as a couple. It’s your turn now to swing into action.
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