Managing your finances together is one of the most important roles you partake on in a marriage.
Differing views and attitudes towards money can pose issues to a relationship. For instance, you may seem frugal to others and stingy to her. If you both live beyond your means and spend lavishly on each other, you might find yourselves trapped in debt. There is time to change. Planning ahead as a team can help you build a strong foundation for your marriage.
1. GETTING TO KNOW EACH OTHER
Get to know each other’s financial beliefs and spending habits. Understand where your partner is coming from and adapt if necessary. If your partner is a spender, agree on establishing some limits. If your partner is prudent, agree on the things you would like to prioritize. Make your expectations clear to arrive on the same page.
“The handling of finances is one of the major emotional battlegrounds of any marriage. Lack of finances is seldom the issue. The root of the problem seems to be an unrealistic and immature view of money.” – David Augsburger, The Meaning of Money in Marriage
2. DELEGATING FINANCIAL DUTIES
Assess the differences in your income and money management strengths to determine how to divide the financial duties. Delegate the person who is financially savvier to take the role of managing your family’s investment options. While, the person who is better at budgeting can take charge of managing the household bills. Take advantage of each other’s strengths and fill the gaps in between.
3. PROVIDING SOLELY FOR YOUR FAMILY
For families with a sole breadwinner, it is practical to maintain an adequate emergency fund to withstand unexpected financial woes. Please consider the number of dependents when finalizing the amount of money to be set aside.
Single income couples should consider helping each other in terms of their CPF responsibilities. You can top up your spouse’s CPF account, especially if he or she has low CPF balances. You can transfer your CPF Ordinary Account savings after setting aside the Basic Retirement Sum in your own CPF account.
4. SHARING BANK ACCOUNTS
There is no one size fits all! Your household arrangement depends on your marital assets, income levels, and financial commitments. Think about which expenses you want to keep separate and which you want to share. You open a joint account for their household bills. Set aside a specific amount monthly to grow your joint account together. Meanwhile, you can keep your own individual accounts to fund your own spending.
5. AVOIDING FINANCIAL INFIDELITY
Financial infidelity refers to hiding financial information behind your partner’s back. Failing to mention a significant expenditure to your spouse may cause problems in the long run. Top money lies include under-declaring one’s income or hiding one’s debts. Such dishonesty can diminish the level of trust between a couple.
6. WORKING ON SAME FINANCIAL GOALS
Find a way to work on shared financial goals. Agree on the amount of personal contributions depending on your income. Some of the common themes that most financial goals share are having a budget, living frugally, getting out of debt, and having a good credit score. Do not forget to save for your emergency fund and retirement plans.
You are in this (wild ride) together!