Communication Is the Foundation
Studies have shown that expecting your spouse or significant other to be in charge of the family’s personal finances is a commonplace thing to do. Yet, experts are recommending that both husband and wife be invested in the time it takes to set goals, invest, and create budgets.
Compromises may have to be made, but it will be best for both people in the relationship to make the other person aware of what their short term goals are as well as long term goals. This will put both husband and wife in a position to always understand the family’s financial status as well as the direction they will take together going forward. This helps to ensure that neither is left in the dark and also that both persons are moving in the same direction rather than separately.
Take Advantage of Insurance
When you are a young couple with no kids, it can be easy to neglect financial tools such as life insurance and disability insurance. These types of insurance products you are definitely going to want to take a look at once you begin building your family and even if you don’t have kids or don’t plan on having kids, it will still be wise to take a look at both life insurance as well as disability insurance.
You never know what life will bring us, so it is best to prepare for worst case scenarios. In the event that your husband, for example is no longer able to work, disability insurance will help you to be able to cover bills and expenses.
In the event of death, a life insurance policy will help to cover your mortgage and bills. A life insurance agent can help you to determine how much life insurance will be necessary based on your current financial status and the amount of debt and expenses you carry. The amount of life insurance one couple carries may not be suitable for the next couple. If you have kids, it becomes even more crucial that you obtain some sort of life insurance and/or disability insurance package.
Decide Early On What Finances Will Be Merged
Experts are recommending that each person in the relationship have their own checking account in addition to a joint checking account. This is called the “three pot method”. It is used best when there is a joint checking account that will be used for joint expenses such as household goods, food, rent, and monthly bills. The individual accounts are used for individual expenses such as hobbies, books, concerts.
This approach requires communication for each person in the relationship to be able to set goals and create budgets together. Also, allowing each other to have individual bank accounts creates and fosters trust.
In summary, be honest with each other, save together, don’t keep secrets, and don’t hide purchases. Communication and saving together is going to be the foundation that allows a couple to succeed financially in 2016 and beyond.