Almost all married couples can not deny that a big number of marital problems are closely related to money. As to financial management after marriage, it is often a touchy subject; probably, you are also confused about how to manage finances in a marriage. If you prefer to sweep those financial issues under the rug, going by the motto “money can’t buy you love”, over time, tension and stress tends to build up between you and your spouse; by the time you can’t toss those bills aside any longer, you have to lay bare all unresolved money-related issues that are existing all the time.
After marriage, you must have found that household expenses are often bigger than you thought and that you often run short of money. And a lack of money impacts as a catalyst for conflict or disagreements. Without a mutually acceptable way of handling financial difficulties, this will inevitably cause long-term, serious damage to your marriage.
No matter how bad your current financial situation is, as long as the two of you are determined to change your financial mindset and adopt good financial management habits, probably it is not too late for you to fix your financial problems.
Maybe so far, you haven’t been sure how to properly manage your own money because you were careless with money when you were single, let alone how to incorporate your spouse’s finances to jointly manage finances in marriage. In other words, financial management after marriage can be a challenging and overwhelming task for you and your spouse; in this case, don’t expect to become an excellent financial planner immediately. You two should allow yourselves enough time to develop healthy financial management habits and tackle specific financial issues one by one.
The following are 7 practical tips on how to manage finances in a marriage:
(1) Be open to discussing finances with your spouse:
It is better to start this thing before marriage, but now that you have already got married, you should get accustomed to discussions about finances with your spouse as early as possible. You should both be aware of how many bank accounts that each other owns and how much debt each other takes on. And be clear on each other’s opinion about how to allocate the money spent on major things for keeping the family.
For instance, you can make it a rule that any purchase plan over 100$ needs to be made through mutual discussions. Before you get too deep into a discussion about a certain purchase plan, make sure to have a clear understanding of each other’s expectation and financial standpoint; sometimes your viewpoint and your spouse’s do not square, but anyway, you should both adhere to one basic principle – Agree to disagree and respect each other’s opinion; surely, you should try to seek and expand common ground and promote cooperation while reserving or putting aside differences on a certain issue.
(2) Set your family financial goals:
After knowing each other’s financial status, you two should enter into a full discussion about the family’s long-term financial goals. For example, when do you plan to retire? Do you expect to have more money to spare instead of struggling with the heavy burden of debt in the future? Should one of you quit the job and stay home with kids (this means living off only one side’s salary)? It is necessary to write down all of your goals and review them regularly. In doing so, you will have a better chance to develop a reasonable financial strategy by combining your personal goals and family financial goals.
(3) Discuss the use of bank accounts (joint and separate bank accounts):
After you are married，have you ever considered creating a joint bank account? Or do you still insist on using your own accounts only? Whichever way you choose, it has both its pros and cons. But probably sooner or later you will have to attach importance to the use of a joint bank account. Combining accounts not only simplify your finances but also helps breed mutual trust; furthermore, it becomes particularly necessary when one of you takes on more child-rearing duties or household chores and thereby has to deal with income inequality in marriage.
But of course, some level of financial independence is also needed by you and your spouse, although this kind of independence makes it easy for one or both of you to hide certain purchases. Plus, given the increasingly high divorce rate in society, keeping separate bank accounts serves as a self-protection measure in case your spouse betrays you and runs off with all your money. So, make sure to discuss the use of bank accounts in detail with your spouse.
(4) Create an emergency fund:
Nobody can ensure that they can completely avoid the occurrence of a personal financial dilemma. In a marriage, an emergency fund should be a top financial priority. And it will come in handy one day when something unexpected happens, such as the illness of family members, natural disasters, a major home repair, and the loss of your job. In case an unexpected situation or emergency causes you to lose income, you can have some savings for supporting your family within a period of time. If possible, set aside at least half of a year’s worth of household expenses. One positive belief for financial planning is that it is always good to have an emergency fund in place because the enhanced financial security better protects your relationship.
(5) Budget your money:
One of your financial goals should be to ensure that you will not go over your budget every month. To maintain financial stability throughout your marriage, it is important to avoid falling into heavy debt; therefore, limit how much you are allowed to spend on certain categories (e.g. dining out, entertainment, and foods) according to your monthly budget. To better figure out the general expenses for the current month, take some time to carefully review your joint expenses throughout the last few months. When you are determining whether you should cut down or increase your expenses this month, the recent purchase history is a valuable reference.
Furthermore, don’t forget to specially allocate some money for irregular or unexpected expenses, such as doctor’s appointments, and routine car maintenance. Your daily, monthly, or yearly budget should be a work in progress, therefore you should get used to making adjustments, especially during the first few months. In doing so, your increased experience will help you manage all the household expenses more wisely.
(6) Track your budget regularly:
After you established a feasible budget plan, you should try your best to stick within the budget, and meanwhile, you may need to change your spending allotment accordingly in case of an unpredictable/unexpected change of your expenses or financial situations. If you are a budget novice and you have been used to being extravagant before marriage, you may consider using the cash envelope system for budgeting your money, this is a kind of strict budgeting system with minute categories for every purchase, and you may feel uncomfortable with it in the beginning, but this can help you save your money over time
Another simple idea is to create an excel spreadsheet to track all your actual spending, and then total it up at month’s end. Besides that, you can also take advantage of certain credit card and debit card tools, as they can quickly and accurately give a breakdown of your expenses per category;
Surely, you can also try other budget tracking systems, as long as you think it works well for your family; but anyway, the ultimate aim is to pay off your monthly credit card balance;
(7) Weekly meetings and discussions about money:
Regular meetings about money help keep you on the right track financially. During these special meetings, there is a wide range of issues that you can discuss, such as how your budget looks for the current month, and how to work better together towards the common financial goals. These meetings play a positive role in enhancing mutual understanding and maintaining a high level of mutual trust. And they reaffirm where you stand financially, and spur you two to do your best to keep your finances on solid ground. Furthermore, by setting aside time to discuss your family financial situations, you can avoid a lot of unnecessary financial anxiety, because you two give prompt attention to financial issues.
While learning how to manage finances in a marriage, you are supposed to master a set of financial management principles.
The principles below may help you develop a firm foundation to withstand future challenges in your married life:
(1) Share responsibilities:
In a marriage, money management is never about having a short discussion and then one spouse carrying the ball for both spouses. It must involve both spouses sharing equal responsibilities and working together. For example, for a financially happy marriage, both spouses need to participate in the strategy-making, budgeting, and bill-paying.
Furthermore, if a couple doesn’t bear collective responsibility for financial decisions, once something unexpected happens to the spouse who takes full control of the family finances and then he/she can not go on to manage finances as usual, probably the other one will be left clueless; assuming your spouse is the only one who arranges your finances and he/she suddenly disappears, the odds are that many unexpected situations will happen to your family and that you will be at a loss of what to do in the face of those bad situations; for example, unpaid bills may pile up and you may fail to pay off the debt in time, or you may have to spend more money on purchasing daily necessities; eventually a once stable financial ground can deteriorate significantly.
To ensure the welfare of you and your spouse, you should both be aware of the overall financial picture and be actively involved in financial management.
(2) Bring up sensitive subjects with love:
When you feel upset/angry with your spouse due to his/her irrational consumption behavior, resist the urge to do anything rash that may further damage your relationship, instead, you should learn to bring up a sensitive subject with love and care. For instance, when you find your spouse is overspending, immediately remind yourself not to yell at and accuse him/her, at the moment, you should point out the budget overruns and tell him/her that you two have to seek ways to bring the budget back into balance, then your spouse can easily realize his/her problem without overreacting. Remember, anytime you should view yourself as your spouse’s teammate, and focus on and improve what the team needs. Sometimes when your spouse is overspending for a good reason, you may try to actively make some positive adjustments to support him/her; anyway, don’t point your finger to him/her.
(3) Seek a fair compromise in a relationship:
When it comes to how to live a sustainable lifestyle and how to invest money, this issue can become easy if you and your spouse are on the same page. But if one of you is extremely risk-averse and the other likes to make a higher-risk, higher reward investment, you two will have trouble in reaching an agreement on how to invest family savings. For example, if your spouse wants to invest most of all your savings in running a startup business but you just want to play safe, you will strive to prevent his/her risk behavior, meanwhile your spouse may also try to persuade you to seize that lucrative investment opportunity. When both sides don’t fall for the marital conflict, a reasonable idea is to try to find the middle ground; in this way, maybe neither of you can fully stay in your respective comfort zone. However, neither of you will also be too far out of your respective expectations.
(4) Be honest:
Both of you must be honest and trustworthy when it comes to family wealth management. If you mess up (e.g. you made a purchase that you should not have made), you should be open with your spouse and admit that you have done something wrong. Initially, he/she may feel upset or angry with you, but after the feelings subside, he/she may trust and respect you because of your honesty and openness. In a marriage, if a spouse catches the other one lying about finances, its effects on the relationship are devastating; hence, if you want to make your marriage last long, don’t do that.
(5) Trust your spouse:
Trust your spouse to handle money unless you determine that he/she commits financial infidelity. If your spouse realizes that you are withholding responsibilities or keeping a close eye on his/her activities, he/she will think your action is somewhat demeaning to him/her and that you are so condescending to him/her. And there is also no need to frequently ask how much he/she spent or made. Let go of your control and just trust. On the other hand, opening and using a joint bank account is also a test of mutual trust between you and your spouse.
(6) Learn from each other:
No matter how brilliant you may be, you can’t know everything or can’t always do better than others. Usually, one spouse knows more financial knowledge or the other is more disciplined and experienced when it comes to financial management in marriage; for example, a wife usually knows more about spending on children and selecting good quality and affordable commodities, on the other hand, a husband is better at planning a budget and investing money. In short, the family money management needs two sides to share out the remaining work and learn from each other.
(7) Devote yourself to it:
You should be committed to addressing financial matters in your marriage. If you have already got used to making excuses for blowing your budget or making ridiculously extravagant purchases, it means that you still do not put your heart and soul into this serious work. Probably, many times when you realize that you go over your budget, you attempt to comfort yourself by saying yourself that you must stick to your budget next time; but, if you are not determined to devote yourself to work at present, such a bad pattern can haunt you again and again.
The final word:
The link between money and marriage is complex and subtle, but regardless of the financial situation you are facing, make sure to keep yourself open and honest. For almost all newly married couples who want a long-lasting relationship, they must learn how to discuss money management together and develop a solid financial plan, and they need to work hard on joint financial plans.
Economic instability is a common factor contributing to relationship deterioration; if your marriage is suffering under the financial strain, it is imperative to get your budget sorted.
So, the earlier you and your spouse reach agreement on how to budget, spend and invest as a couple, the more conducive it will be to the health of your relationship.
If you want more tips on how to deal with marital problems involving money, you might go on to read the related posts below:
7 simple tips on how to deal with financial stress in a marriage.