Hitching Finances Are Getting Hitched – The Mindset of a Financially Empowered Couple
Anyone who has been nurtured with a capitalist mindset learns to fend for themselves first before sharing financial responsibility. Fortunately, the norms of social life have better plans for us and allow us to upgrade our financial independence to financial interdependence with the gift of wedlock.
Although some people might feel that financial independence should ideally be built on the back of one’s own back, you should know that none of them will stand by when financial troubles tie their noose around you. It’s going to be you and your loved ones vs the rest of the world – plain and simple. And in a city as costly and debt-inducing as Singapore, you really do need the support of your significant other to pull you through life in one piece.
When we fall in love which often leads to marriage and once we are married, as much as we don’t want it, there are certain changes that are inevitable.
Financial planning from a ‘married’ point of view is very, very different. One needs to start dividing expenses and plan a shared retirement if it is true love and you cannot see yourself without your significant other for the rest of your life.
Therefore, here are few ways by which you can plan your post-marriage finances in an easier way:
Discuss Your Priorities to Have a Clear Vision
You need to start discussing everything with your spouse, including everything from your plans before marriage, to the way you usually spend money, and how you have imagined your life to be in the future.
Both of you must know what the other person wants in order to make decisions that fulfill the requirements of both the people as much as possible. One must inform the other about any big purchases and preferably consult the other before going ahead and making it in order to maintain a stabilized approach to meeting each other’s financial targets.
Reviewing your savings and investment plans every 3-6 months is a good strategy to ensure you both are still on the same page financially. Establishing long-term plans gives couples a chance to plan their finances around important future priorities such as paying off their home loan or supporting their child. It forces one to rise above the paycheck-to-paycheck style of living and take the pressure off each other’s shoulders significantly.
Avoid the “Yours” and “Mine” Mentality
A couple should ideally exclude divisive words like ‘your money’ and ‘my money’ from their vocabulary because that often leads to a lot of friction. A couple needs to get used to the term “our money”, otherwise the person who makes less will always feel pressured and inadequate.
Both of you need to be involved in each other’s finances equally so that it is a combined expenditure with the consent of both the people.
Steer Clear of Peer Pressure
It is often seen in young couples that they succumb to peer pressure easily. If their friends and family are living a high end lifestyle, they would also do the same even at the cost of their savings. While living in the moment is good, it is not always favorable to your finances, unless of course, you can actually afford it.
Also, do not be fooled by what you see. There are people who do not mind drowning in debt because showing off to the world how grand their life is, is more important to them. Steer clear from such illusions because five years down the line, you will be in a much better place that they ever will be.
Encourage Equal Involvement
Both the people need to have equal involvement in the financial matters. It is a necessity, not an option. While it hurts to imagine the worst, and being uncertain whether the future will hold the two of you together due to an unfortunate incident of a divorce or the sad demise of one of you, not knowing your finances will definitely leave you in a rut.
Insurance and emergency fund accounts are valuable assets to have to ensure your personal financial integrity no matter the circumstances.
Even if no such incident is in store for you, you still need to know where all your money is. And if you have divided the work where one of you is handling investments and the other one is paying the bills, do not get too comfortable doing that. Keep switching your duties to become the jack as well as the master of all trades. It will never go waste.
Thus, these are a few ways that newly-weds can consider doing once they are engaged or married because marriage expenses do not begin and end at the wedding ceremony or the honeymoon.