Many couples will tell you that money is one of the biggest causes of arguments in a marriage. If you want both wedded bliss and a fat bank account, start your life together on the same page. This advice may seem simple, but following it is more complicated, so stick to a few rules and you'll reap the rewards in no time.
Create a Budget
Now that you've tied the knot, you have two incomes and a shared household. Sit down with your spouse to devise a monthly budget for running your new partnership. Use spreadsheets to record your incoming wages and savings and your outgoing expenses. Designate your inflexible bills, such as mortgage or rent, utilities, installment loans and credit card payments, to be paid first. Then, consider your flexible expenses such as food, entertainment, insurance, pocket cash and savings. Work out a budget.
Choose the Bill Payer
After you have worked out your monthly budget, decide who will be the primary bill payer. The primary bill payer also takes responsibility for balancing the checkbook and knowing how much money is in the joint bank account at any given time. Having one person control the output streamlines confusion, makes bill paying orderly and timely and reduces the potential for fights over money. This may be a snap to decide if one of you is more organized or better with finances. But if you fuss and fume over your spouse's spendthrift habits, or one of you wants to save money by cooking at home while the other craves the fun of eating out, you might need to sit down with a financial planner who can help you prioritize where your money goes and decide who will manage the bills.
It’s true that you should have several months of living expenses in savings, because you can’t predict job loss, illness or other circumstances that wipe out incoming cash. Set aside a portion of your income every month for a savings account. Participate in your employer’s 401(k) retirement plan; employers often match your contributions, which is free money for you. Open IRA accounts and contribute whatever you can. The long-term impact of opening a retirement account in your 20s or 30s is strong, as compound interest accumulates over the decades until you retire.
Get Rid of Debts
Starting a marriage debt-free is ideal but, alas, unrealistic. You probably have debt from your wedding, school loans or credit cards. Start by paying off each credit card one by one. Pay off either the card with the highest balance or highest interest rate first, while paying the minimum on the other cards. For school loans, investigate loan consolidation options, which may lower your payments and allow for one convenient payment. Devise a plan for short-term debt, such as cutting expenses or taking a part-time job temporarily to pay down your balances.
Francine Richards is a licensed multi-state insurance agent with years of human resources and insurance industry experience. Her work has appeared on Blue Cross Blue Shield websites and newsletters, the Houston Chronicle and The Nest. Richards holds a Bachelor of Arts in communications from the University of Maryland.