Money and Marriage - Part II

Budget

 You may want to set a budget to stick as close as possible to expected spending limits. Start by recording current spending in these areas, and then agree on the amounts you want to spend in the future. 

• Rent or mortgage payment

• Utilities, including electric, gas, water, garbage, phone, internet, cable

• Food and supplies, including grocery, kitchen items, liquor, and eating out

• Entertainment, including travel, vacations, local events, holiday decorations, Netflix subscriptions, tech gadgets, books, etc.

• House maintenance including repairs, cleaning, lawn care, appliances, and decorating

• Automobile, including gas, insurance, licenses, and maintenance

• Clothing and accessories, including dry cleaning

• Health care, including pharmacy, doctor’s visit, and HSA contributions

• Personal care, such as haircuts, nail care, etc.

• Tuition and/or education expenses

• Contribution to retirement and savings accounts

• Charitable contributions

• Taxes, including federal, state, local, school, and property

• Paying down credit card or student loan debt

Retirement

What does retirement look like to both of you? Having this conversation will be enlightening. Know that dreams and goals will change over time and as retirement approaches.

You’ll want to have an idea about what you’d like to spend during your final years so that you can make plans to start accumulating that wealth now. The sooner you start, the more years you have to build up your retirement assets. 

Monitoring your progress

Keep an eye on your account balances to make sure everything is as it should be. Review bank and brokerage account statements and/or your budget once a month or at least once a quarter so there are no surprises or trends that sneak up on you.  

When you reach your goals, reward yourself. Managing money is hard work, and you deserve to acknowledge and celebrate your achievement. If there is anything we can do to help make your financial dreams come true, please reach out any time.  

Money and Marriage - Part I

One of the biggest things that can cause fights in a marriage is money. No matter where you are in a relationship, it’s a good idea to discuss these major money topics so you’ll know where you and your partner stand. 

Show me the money:  Combine, keep separate, or both

One of the best ways to avoid conflict is to put your money into three separate ‘buckets’: yours, your spouse’s, and a joint set of accounts. In this arrangement, each of you has control over some money that is your own. The household spending will then come out of the joint account, and both will make contributions to it on a regular basis. 

As a couple, you’ll need to discuss who is responsible for what as well as what your regular contributions to the joint account will be. This is not an insignificant discussion. The more thorough you are, the less conflict you will have over money.

One spouse or partner will normally handle the joint finances, and it’s typically the person with the most accounting knowledge. However, both should have access to this account in case of emergency.

Savings and future purchase goals

Do you have goals about upcoming large purchases?  These might include:

• A home purchase or improvement

• Children’s education

• Health care needs

• Saving for retirement

• A car purchase

• A second home purchase

• A vacation

• Another item such as a boat, furniture, technology gadgets, a plane, or something else

• A nest egg or cushion

If so, calculate how much you need and make a plan to set aside the money you need in the agreed upon time frame. 

Spending

Do you like to spend more than your spouse? Or is it the other way around? When money is flowing, there is usually no problem. When money is tight, that’s when the problems arise. 

When there are conflicts in the area of spending, it is best to focus on priorities. If you are in agreement on your priorities and goals, it can often shift spending habits.  

Stay tuned for Part II…