Weddings only happen once in a person’s life. Still, a lot of young couples make financial mistakes that hurt their long-term security by accident.
Follow these 9 money tips for young couples to set yourself up for a happy marriage and good finances:
1. UNDERSTAND HOW YOUR PARTNER VIEWS (AND SPENDS) MONEY
Money is a sensitive topic, and no one wants to feel judged about how they spend their money. Because of this, people should learn more about how their partner handles money before making any joint financial commitments.
From spending habits to sensitive topics and “trigger words,” these are the words, phrases, or topics that make your partner feel awkward. Planning will go much more smoothly if you know how to talk to your partner in a way that will help you both.
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You can do this by writing down the money issues and extras that cause the most fights. Don’t make these topics off-limits, but do think of new ways to deal with them. From making a budget together to letting your partner enjoy certain luxuries within that budget. Whether it’s a collection of high-end shoes, handbags, or whiskey.
2. DISCUSS MONEY BEFORE THE WEDDING
The most important day of your lives together is the day you get married. But once the ceremony is over, people have to face the real world. Because of this, you should talk about your long-term financial plans long before you get married.
Do you want to share the same amount of money, or is that not possible? The key is to talk to each other often and honestly. Talk about your financial past, your financial goals, and even the scary subject of joint debt. The more you talk about money together early on, the easier it will be as your relationship goes on.
3. SHARE YOUR LONG-TERM FINANCIAL GOALS WITH OTHERS
The money goals you have change over time. You can’t decide for sure after just one conversation. Instead, set aside time each month for a “money date” where you and your partner can talk about your finances and adjust your financial goals.
This monthly “money date” is a good time to talk about buying a new car or planning a trip abroad that will cost a lot of money. If you and your partner both know what you want to accomplish, it will be much easier to reach your goals.
4. CREATE A REALISTIC BUDGET (AND STICKING TO IT)
Making a budget that you can stick to can help you in the long run. The first step in this process is for each person to look at the other person’s monthly income and expenses. Add up these numbers to find out how much money your household makes and how much it costs.
When planning a wedding, you should figure out how much you can spend and where you can save money. The key to making a budget is to under-estimate your income, over-estimate your expenses, and always save for a rainy day.
Just as important as making a budget is sticking to it so you can save money in the long run.
If you want to stick to a budget, you need loving support and encouragement. From items on sale that you “need” to that new designer phone that “everyone has.” In these times, you and your partner will need to help each other out and be helped back in order to make the right long-term financial decisions.
With the help of a loving partner, you’ll be able to make short-term sacrifices that will help you in the long run.
5. ALIGN YOUR PLAN FOR SAVING FOR RETIREMENT
Plan ahead and you’ll be able to enjoy your retirement more. Check out each other’s retirement plans to make sure you’re making the most of all the perks. For example, if your employer matches your contributions, you’ll have more money to spend in retirement.
6. MAINTAIN OPEN, HONEST COMMUNICATION
In love, as in life, it’s important to talk to each other in an open and honest way. Any debts or expenses you don’t pay attention to will come back to haunt you at some point and throw off your financial plans.
Instead, talk freely about money on your “money dates.” This is your chance to look at your joint financial plan again and again to make sure it still fits your needs and the way you live.
7. START FAMILY PLANNING EARLY
You might not be ready to have kids just yet. But it is thought that raising a child in Malaysia will cost a lot. If they go to school abroad, it can cost up to RM 1.1 million to send a child to college. Or RM 400,000 for local education up to the level of a University. [1]
Because of this, it’s best to plan and save even if you don’t plan to have kids soon. This gives you time to build up your money before you really need it.
8. BE PREPARED FOR LIFE’S LITTLE ACCIDENTS
In the same way, it’s important to plan for financial obligations that seem to come out of nowhere. Whether it’s a broken washing machine, damage to property from a natural disaster, or health problems. It’s important to save a little bit of money each month in case something goes wrong.
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When you think about getting married and having a family, your own death becomes more real. So, life protection insurance is a must if you and your partner want to be sure of your future no matter what happens.
9. INVESTING WISELY
You don’t need millions in the bank to invest money. It does, however, require a long-term focus on building your joint assets to get the best returns.
Your investment can be as low as RM 5,000, but you should only invest money each month that you can afford to lose. This includes waiting to start a portfolio of investments until you have saved up at least six months’ worth of salary as a safety net.
With this extra safety rope, you will be better able to use a savings and investment plan like our A-EnrichGold plan to get the most out of your money.
