What Every Newlywed Should Know about Finances

3 tips to successful couple finances

By Cheryl Ng | 24 October, 2017

No, romance and finance are not good bedfellows. In fact, arguments over money constitute one of the top marriage problems that couples face. As unromantic as it may sound, sound finances are often critical to marital bliss. It is important to establish early on in the marriage how finances would be managed and set some ground rules for expenditure. Here are 3 tips to help you keep arguments about money to a minimum.

1. Communication

Financial intimacy begins with open and clear communication to find out how we are handling our money as a couple.

Conflicts about money point to differences in values and needs so it’s important to understand each other’s attitude and approach towards money. Discussing the purchase of our first lamp with our pre-marital counsellor definitely shed some light on this issue: I had reserved a beautiful origami-styled table lamp at a sale in a French departmental store but my husband-to-be was aghast when he had to pay $200 for it.

Financial intimacy begins with open and clear communication to find out how we are handling our money as a couple.

Recognising that family history also plays a part in shaping our money habits goes a long way to enable us to be considerate towards our spouse’s outlook and spending culture.

2. Priorities

Financial compatibility for a couple building our lives together starts with zeroing in on our goals: furthering education, buying a home, starting a family…

Every couple will have independent goals as well as shared goals. Discussing these visions helps to shape a joint plan. It allows both parties to take ownership of and manage the family finances prudently.

There are areas where we agree to share responsibility, but there are also others where we work to reach a compromise. As a newly-wed couple, saving conscientiously to pay the mortgage on the apartment we had purchased was a common objective, so was shopping carefully for kitchen equipment to empower the inner chefs in us. However, we also gave each other leeway to indulge in state-of-the-art electronics or the latest literary releases within our personal budgets.

3. Partnership

Financial collaboration works well when both partners understand the family finances and manage the money together. It means that we’ll both know what we can or cannot afford to spend on.

Co-budgeting nowadays goes conveniently the way of spreadsheets and even, apps. Different accounts can be created for different goals.

Financial collaboration works well when both partners understand the family finances and manage the money together.

Whether it is My Money, Your Money or Our Money, couples find a strategy that works for them uniquely.

Some couples choose to work from only one joint bank account and completely co-mingle their finances, carrying only joint credit or debit cards, and listing each other on all investments.

Other couples maintain separate bank accounts and contribute towards a joint account to pay the household bills at a rate that's proportional to their income.

Yet other couples who keep separate accounts pay into the joint account for household expenses equally regardless of their income.

There are also couples who only have separate bank accounts but agree on who pays which bills.

In the early years of our marriage, my husband and I found it agreeable to maintain our own accounts for personal expenses while contributing equally to a joint account for the household. This had seemed natural and fair as we learned to negotiate new financial boundaries and freedom.

However, as his income increased more quickly than mine did, he was ungrudging in putting a larger proportion of his earnings into the family pool, especially when we had higher expenditure with the arrival of the first two of our children.

And finally, when I stopped work to take care of our children, he became the sole contributor to our family fund. He was reassuring in his commitment to ensure that all our expenses were paid for, and in his generosity to release my ad hoc earnings as 'fun' money.

Communication is key as a couple sets up their financial goals and management system. Expectations need to be clear about boundaries and independence. There could be room for some privacy and autonomy in spending but setting a limit (above which a joint decision is required) is usually necessary. Of course, the agreement should be reviewed when the family circumstances change.

There’s no single best practice for managing money as a couple. What's important is to choose a method that works well for your situation. The strategy can be modified for the perfect balance between individual money and couple money. Ultimately, the focus for couple finances is about respect and equality.

© 2017 Focus on the Family Singapore. All rights reserved

Cheryl is the Principal Trainer at Focus on the Family Singapore, and believes that children are the future and family the nurturing ground. She and her husband have four children.

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