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Business News/ Money / Personal Finance/  Just got married? Here are 5 ways to help you manage money effectively with your spouse
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Just got married? Here are 5 ways to help you manage money effectively with your spouse

For a newly married couple, the first thing to do is to give structure to their monetary interaction. Behind the roses, cards and gifts, there is the larger reality of paying your bills, setting common goals, working towards these goals; and yet retaining individual ambitions.

Married couples have to contend with the reality that, like Murphy’s Law, things do not go as planned.Premium
Married couples have to contend with the reality that, like Murphy’s Law, things do not go as planned.

More often than not, it is money that defines and determines the course of relationships. This is very true for young married couples. Hence, they must get their priorities right, set their common goals and have clear demarcation lines of who takes care of what. 

Get your finances right

For a newly married couple, the first thing to do is to give structure to their monetary interaction. Behind the roses, cards and gifts, there is the larger reality of paying your bills, setting common goals, working towards these goals; and yet retaining individual ambitions. The key is getting your finances right and clear communication of roles.

Start with a married couple financial plan

Why have we used the term; married couple financial plan? That is when the real planning starts. It is now about common goals, common resource pool and jointly nurturing your individual ambitions too. A couple has short term goals like buying a car and other assets. They also have medium term goals like a home and foreign holidays. The tough goals are the longer term goals like retirement, child’s education etc. The first step for the couple is to sit down with the financial advisor and document this plan.

Also Read | After 'I Do': A guide to managing post-wedding finances as a couple

Wait, there are some building blocks first!

Even before you act on the journey towards your goals, there are two key building blocks. Firstly, create an emergency fund to cover 5-6 months of expenses for exigencies. The next building block is insurance. If both are earning members, life policy to cover both is must. More importantly, a liberal health plan family floater of at least 15-20 lakhs is essential. Going ahead, the couple must ensure all assets are insured for value and all liabilities are covered for principal by a term plan.

Time to work out the investments

This is the last step. Here you peg SIPs to goals, depending on the risk and tenure of each goal. Long term goals can be backed by equity fund SIPs, short term goals supported by liquid funds, and medium term funds backed by hybrid funds to get the best of both worlds. Squeeze the maximum savings out of your income but do not go overboard.

Have a Plan-B in place

Married couples have to contend with the reality that, like Murphy’s Law, things do not go as planned. The just married couple must have a back-up plan for special situations. How to handle finances when you are expecting a baby? How to handle loss of job? What if either parents need special care? What if you children need special care? These are situations for which the couple must document Plan-B.

Couples must be sold on to the power of planning. Financial planning is a great force multiplier. Start by saving and investing 10% to 15% of your income monthly and gradually scale it up. You would most likely surprise yourself!

Nehal Mota is Co-Founder & CEO, Finnovate

 

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Published: 28 Feb 2024, 03:30 PM IST
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