10 Smart Personal Finance Tips Before You Get Married
Tue, Feb 23, 2010
Looking back, I know my wife and I made some pretty good decisions before we tied the knot, but there were probably a few things we could have done better. With money being one of the top causes for divorce today (and a whole lot of arguments), I think it makes sense to get marriage started on the right track from a financial standpoint. So, below are 10 tips every engaged couple should think seriously about doing before they get married. Yes, life tends to get busy as soon as you get engaged, but you won’t regret making sure you’ve got a solid plan for managing money the day you return from your honeymoon!
10 Smart Personal Finance Tips Before You Get Married
1. Get everything (all financial matters) on the table
Probably the first thing to do is to sit down and tell each other absolutely everything about each other’s finances. It may just be best to schedule the conversation when it can be uninteruppted timed together.
Do you have a lot of debt? It’s okay. You might as well talk to your future spouse about it now because he or she will soon find out. This is often a trust discussion. If you’re having trouble here, definitely follow step 2.
2. Go see a financial counselor
How did it go during your first conversation about money? Eve if it went well, and certainly if it didn’t go so well, I recommend going to see a Christian financial counselor. The counselor can help you get things organized and determine your next step in merging your finances together. Yes, merge is the key word here because marriage, after all, is two people becoming one!
3. Set up your first budget
Once you know what each person is bringing with them to the relation ship in terms of income and expenses, you should be able to sit down and draft your first budget together. Have a plan for how things are going to start working once you return from the honeymoon. It’ll reduce a lot of stress just knowing how you’re going to operate together financially each month. And if you want to start a family in the future, consider working towards living off one househould income.
4. Stop spending on credit now
The last thing you want to do is face spending challenges. Learn something from step 3 and put yourself on an individual budget immediately. Just because you have a plan for when you get married, doesn’t mean you can’t follow one now. Don’t spend more than you have each month to avoid wrestling with credit card debt and spending issues when you get married. If you already have credit card debt, your monthly marriage budget should include a category for paying that debt off in the first 1-2 years of marriage.
5. Begin saving for emergencies
Having a plan to save for emergencies should have been the primary goal for my wife and me before we got married, but it was probably the farthest from our minds. If you can start putting back some money now in your individual budgets and then combine it together when you’re married, you’ll be on the right path to reducing the risk of using a credit cards for emergencies in the future.
6. Learn about Biblical financial stewardship
Probably the most important thing you can do is to learn more about God’s plan for money. Crown Financial Ministries offers a Biblical Financial Study that helped us understand God’s perspective on managing money.
7. Identify the family CFO
There is typically one person in the relationship that possesses the desire and skills to organizing the finances, paying bills and tracking expenses. Who is this person going to be in your relationship? Decide now who’s going to manage the numbers and be responsible for keeping the other person informed.
8. Have a plan to pay off car loans
Many couples will enter into marriage with two car payments. If you’re serious about getting out of debt and being in a better financial position when you’re ready to start a family, make sure paying off your cars is a part of your debt plan. Once they’re paid off, commit to driving them until the wheels fall off.
9. Identify your next Money Map destination
With some many things to think about (emergency savings, getting out of debt, creating a budget, etc.), it can get to be a little overwhelming. So, get a copy of the Money Map and identify where you are and also your next destination. Make sure you’re focusing your all your attention on that current goal. But also know the next step and when you you’ll get there. As long as you’re following your plan, you’ll make quicker progress than you think.
10. Plan your wedding on a budget
So, put all that talking and planning into practices and make sure your wedding doesn’t leave you with a big financial mess to clean up when you return home from the honeymoon. Are you responsible for paying some or all of your wedding costs? If so, you can definitely plan a wedding on a budget.
So there you have it, 10 smart money tips before you get married. If you put these tips into action, I can tell you, you won’t be sorry. And you can focus on the fun part of marriage, enjoying your new relationship together.
What do you think about these tips? Do you have ideas for helping young couples get their finances in order before marriage? If so, please let us know about them in the comments.
Nice post.
I really think the importance of getting to the point where a couple has no bad debt (such as paying off the cars, as you mention) is crucial for a much happier marriage. The less credit card debt and splurging there is, the more you can plan for great vacations and so forth.
Keep up the good work!
The Rat´s last blog ..The Best Retirement Destination
Absolutely. This is some important and something I wish would have been the case for my wife and I. Without the debt, you can move onto savings and investing goals which are a lot more fun.
Great tips money can be the biggest problem in a marriage. A lot of people talk about moral, religious and sexual compatibility before marriage. Perhaps they should talk about fiscal compatibility as well.
Daddy Paul, your comment made me think of something I should have included here. My wife and I went to a marriage seminar at our church that talked about all the things you mentioned. It also included a money component. I’ll bet many church’s offer offer these types of seminars or workshops. Might be a nice thing to do on top of getting enrolled in a Crown Biblical financial study.
“Identify the Family CFO.” This is an important one. AS a matter of fact I posted today on “Cardinal Sins of the Money Nerd” in a marriage. You put together a good list here.
Ken´s last blog ..“Money Nerd” Cardinal Sins
Thanks, Ken. Definitely setting expectations for who is going to do what in terms of managing the money is important. Even though there is typically a family CFO, the other spouse can and should participate.
Ken, we absolutely agree! Someone has to be the “administrator”, and hopefully each marriage has that nerd
Andrew @ Earn Give Save´s last blog ..The [almost] impulse purchase
Communication is so vital. My gf and I have been together for 3 years and I couldn’t imagine being as close as we are without communicating.
I recently wrote a post about how we split our bills (based off a % of our incomes). Your readers might be interested in that if they’re struggling to split bills every month.
Great post!
Austin @ Foreigner’s Finances
Austin´s last blog ..How to Peacefully Split Bills in Your Relationship
Austin, thanks! I’m curious to know if you thought about just combining everything together and paying your bills out of one joint account.
This is significantly a great PF article. I totally agree the first and foremost tip – presenting all the truth about each other financial condition (potential condition). In a relationship, honesty is is still the best policy. By discovering current and potential financial problems – we can find early cure or preventive measures.
Victorino´s last blog ..Personal Finance Tips #2: Buy the Big First
Thank you, Victorino! Yes, I find so many people just don’t get it all on the table. While it may not be pretty, it’s the best thing you can do for your relationship. Once it’s out there, you can begin building on a solid foundation of trust!
Hi Jason; I found all of your advices interesting and realistic but…
What about when there are already financial issues/mest in one of them?
Would that be a reason not to marry even when you think/know did that is you significant other?
Reme, if there are already issues and you know this person is the one, I would recommend seeing a financial counselor or see a premarital counselor. My wife and I attended a marriage seminar at our church that touched on challenging topics such as money. A counselor can spend some time with you and help work through any challenges and make your relationship stronger.
So there couldn’t be a problem if both of the parties knows the financial situation that already exist and given that step forward and getting help to resolve it, when both of us have the determination did that’s what we really want to do?
Is it true that Love can do anything?
Thanks Jason.
Rene, I’m not sure I understand your question? But, I’ll try to answer. The relationship is top priority. In my opinion, a relationship built upon trust, Christ and a strong commitment to one another can overcome any obstacle.
You are the Man Jason!!
Thank you so much and blessings for you and your family.