Getting married is one of life's biggest moments. While it's an exciting time for many newlyweds, it also reminds couples of some tough decisions they may face, like joining their finances. Discussing money can be uncomfortable, but often necessary when officially becoming a family.
In our latest blog post, we are discussing steps for newlyweds to successfully merge their finances.
Start the Discussion
The first step is to simply start talking about money. Create a spreadsheet of each person's current credits and debits. It's important to understand each other's current financial state.
Create a Plan
Once you have a grasp of each person's income and debts, create a plan. Work together to create a monthly budget that includes shared expenses such as your mortgage, car payments, utilities, child care, etc.
Establish a Joint Account
Now that you understand each other's finances and have a plan in hand, you may find it's a good idea to establish a joint bank account. This joint account can be used to fund all the expenses detailed in your budget. It is up to you and your significant other to determine how much each person will contribute to the joint account based on incomes and what is reasonable for each other's circumstances.
Keep in mind, you do not have to give up your personal account just because you are married. You may decide it works best for you to keep a separate account for your personal spending and a joint account for major monthly expenses.
Factor in Savings
Don't forget to factor in having a savings account. It's wise to have a portion of your budget dedicated to 'what if' dollars. Having an emergency fund will ensure you are prepared if one of you loses a job, becomes injured, or any other unforeseen major expenses.