If you’ve just gotten married, congratulations. This is a wonderful and emotional time in your life and the future holds many things including homeownership and parenthood. It also means that there are going to be financial situations and decisions that you’ll need to make, some of which will be bigger and more important than anything you’ve ever done before in your life.
If that’s you, these personal finance tips for newlyweds are going to be a godsend. The fact is, being on the same page with your spouse on all things financial is extremely vital and can mean the difference between having a wonderful life with many opportunities and retiring well off or, well, the opposite. So take a few minutes, open your mind and let these tips sink in. Enjoy.
- You may have heard the old adage “2 can live as cheaply as 1” and, once you’re sharing money for food, transportation, rent, electric and so forth, it can feel like you suddenly hit the jackpot. The problem that many couples have is that, instead of banking that extra money at the end of the month, they spend it on things that aren’t extremely important like travel, electronics and clothing. Our advice is not to increase your spending, start a budget and start paying down your student debt and other debts as fast as possible rather than spending the extra money on unneeded and necessary ‘stuff’.
- Speaking of that old adage, one thing that you may want to try is to live on one of your salaries and save the other. Simply put, it’s not a good idea to count on the money that you are now earning. Voluntary or unexpected interruptions in your income, such as a layoff or pregnancy, might hurt you severely in the finance department if you’re not prepared. Not only that but, if you’re planning on starting a family, it’s possible that one of you may want to stay at home with the children for a few years. Planning for these changes, good or bad, using the second salary that you’re putting away in is an excellent idea.
- Saving for retirement at this point may seem ridiculous, especially if you’re in your 20s and retirement is 40 years away. Here’s a cold hard fact for you however; if you don’t save for yourself nobody else will save for you. Yes, the federal government will send you a small check (maybe) but, in our opinion, it’s not a good idea to rely on that in any way, shape or form. For that matter, maxing out any retirement savings plans that you have either individually, together or through your work is a very good idea. Your goal, as far as experts today are concerned, should be to save between 15 to 20% of your combined gross income every year.
- Make sure that you have plenty of insurance. Right now, without any kids to think about, insurance against catastrophic medical bills or long-term disability is a good idea. Once children arrive you’ll definitely want to look into getting plenty of life insurance as well.
- Enjoy yourselves knowing that, while you may not have every single thing that you want, you’re living within your means and preparing for the future.
If you haven’t gotten married yet but the big day is coming, now is the perfect time to sit down as a couple and discuss your financial goals and dreams. Knowing this information ahead of time is extremely important and, in some cases, may actually save you from making a mistake that could haunt you for many years. Best of luck and, if you have just got married, once again congratulations.