Check if you can tick most of this financial checklist before you get hitched to enjoy a stress-free wedding!
Are you financially ready before getting married?
Getting married can be so exciting! The initial phases of marriage are undoubtedly the most fun part. However, once you start living with the person, you realize there are other things you should have considered. The “other” things are primarily related to the financial aspect. This is where you realise the importance of the money question you should have asked your partner before marriage
The “other” things are primarily related to the financial aspect.
Does your partner order food online every time they have a craving? Does your partner save much more than you do? Does your partner enjoy going out every weekend? Do these things bother you?
Many questions may seem trivial but become very important once you start living with the person.
Here are some questions you need to ask your better half before tying the knot :
Joint account or separate accounts?
Experts claim that having a single joint bank account has several advantages.
Both partners have easy access to the money in the account, making it simple for either partner to access it and, in some cases, keep track of their financial actions.
This might facilitate the partners’ effortless wealth management and financial planning.
The decision of having a joint account or separate accounts will vary from couple to couple.
The factors can be, are both of you earning a monthly income, do both of you pay taxes? Quite evidently, financial planning is crucial.
If only one partner is a taxpayer, then having a joint account may not be beneficial. Depending on the situation, you can either convert your existing account to a joint one or open a new one.
It’s advisable to occasionally share financial responsibilities or alternate each month so that both partners can access all accounts and understand how to handle the family’s finances.
If you find this overwhelming, go to a financial expert who can help you plan your finances with your partner.
Are you ready for the unexpected financially?
Start your planning as soon as possible. Several unforeseen circumstances could occur after marriage.
Have you considered one of you being unemployed at some point? You might have done the financial planning based on the incomes that come in every month, but are you prepared when the income changes?
To protect against such a situation, building a cash reserve equivalent to up to six to twelve months’ worth of living expenditures is imperative.
Another way to prepare yourself for the unexpected would be to invest in life or even health insurance.
In case of losing a partner or serious health problems, having a suitable insurance plan will save the day.
It might seem extreme to plan for such unpredictable events, or even uncomfortable in some cases, but do not run away from planning this.
You will be doing each other a favor by preparing for the worst.
Compare your budgets; are you compatible?
Creating a budget is one of the stepping stones toward financial planning.
How much will you spend on your wants and needs, and how much will you save? Discuss with your partner the style in which they save.
Plan on how much will go to a liquid fund, how much to an investment plan. Your assets and debt will all be combined after the marriage.
Be open and honest about your future ambitions. Ask your partner about her or his plan.
It will give you a general idea of your family’s combined financial situation and projected future earnings.
Get a reality check on your buying habits before tying the knot. This is one of the most crucial financial things you can do.
Analyze your expenditure and identify areas where you may make savings.
Instead of focusing on your bad spending habits, you want to start your new life together on the right note.
Are you on the same page when it comes to planning your future?
Does it seem like you are an overthinker if you plan your retirement before even getting hitched? The answer is no, absolutely not.
You have decided to spend an eternity (hopefully) with this person, so planning how you want to retire is only prudent.
If you’re in your 20s, you can ensure you’re on a decent route for retirement, just like you should save money for emergencies.
Communicate with your partner to find out what future he or she would want. Do you have the same long-term plans?
Long Term plans include buying a house, having kids, saving for their future, and finally, your retirement life.
So before you take that leap, decide with your partner how you will split your savings to save for your future and, most importantly, your retirement.
Are there any debts or EMIs to be shared?
After marriage, monthly costs go up.
To prevent overspending on existing credit cards, loan repayment, or EMIs, it is preferable to create a budget and keep track of monthly financial inputs.
Creating a budget is always a great start if you want to manage your finances.
Making lifestyle adjustments to handle EMIs and credit card costs is highly recommended.
If you or your partner has multiple loans, figure out a strategy to repay the debt at the earliest, without dampening your savings.
Making smaller goals is one of the best debt repayment tactics, particularly when there are several debts.
Complete the repayment of one loan to remove it entirely from your accounts. You’ll feel accomplished for completing one little goal.
In conclusion, considering all the above mentioned aspects might seem overwhelming, especially if you’re planning your wedding and getting acquainted with each other’s family and friends.
But, take some time to discuss finances with your partner as it’s one of the crucial foundation stones for a successful and peaceful marital life.
Having this conversation about money will make your married life simpler and much more fun.
Would you rather have the fun of being newly married or figure out how to sort out your finances in the first few months of your marriage? We leave this for you to decide.
All the best!