Simple Financial Management Before Marriage

 

There are several questions in the minds of many people as they plan to get married. But by far the commonest worries of couples and married people is how to mange finance and the so many attendant issues accompanying it.  

If one spouse makes more money than the other or has more assets than the other, should there be any problem or special prenuptial agreement?

A prenuptial agreement is ideal to help the distribution of asset in case of ones death. But the purpose of marriage is not for one spouse to be financially independent and the other is not. If you want to have financial peace in marriage, then you must communicate together and share all financial matters equally. This does not mean that one spouse cannot spend more than the other spouse, such as hobbies, if it is agreeable to both spouses.

What about having separate savings or checking accounts? Separate accounts would be more like roommate relationship. You are not roommates. You are in a committed, lifetime relationship once you get married. Do not keep secret accounts unknown to your spouse, because sooner or later, the other spouse would find out about it. 

Putting money in joint accounts is ultimately the best arrangement in most cases. For instance, in the case of death, joint accounts which comes with right of survivorship or joint beneficiary allows ownership to pass directly to surviving spouse without going through the trauma of file contending with family and in-laws; coping with delays in filing claims and other public records that may be required.

 

Working up a budget is a very essential part of financial management. Too many couples have no idea how much they spend (or waste) each month compared to how much they earn each month. This leads to debts that their income cannot pay for.

A simple budget will help ensure that you don’t spend more than you earn, and help you achieve financial success, and create the ability to save for things you need in the future, such as school fees, college tuition and retirement.

Your housing expenses, including rent, taxes, insurances, utilities, and repairs and maintenance should be no more than 40% of your gross income. Then allocate your other expenses, such as food, clothing, medical, transportation and entertainment among the remaining amount you have to spend.

You need to build up an emergency saving fund for emergencies that may arise. Then set up a long term saving and investment plan. Remember to include church and other religious obligations including charitable contributions in the plan as well.