Managing money as a couple is different from managing money when you are single. As a couple, you will have multiple income streams and different spending habits. Both partners will have different dreams and goals. This makes managing money complicated after marriage.
You need to be honest, transparent, and open to communication when planning finances with your partner. Partners should feel comfortable and confident sharing their financial situations and goals. To build a successful relationship, you need to balance your financial habits. Your goals must align, and you should start making decisions considering both your needs and values.
One important thing you can do to build a strong and lasting relationship is to manage money together. To help you manage money as a couple, we have a comprehensive guide that will equip you to handle everything from budgeting to financial goal-setting together.
Communicate openly with your partner
Communication matters in smooth money management as a couple. Before jumping into the numbers, understand each other’s attitudes toward money. Many financial issues between couples start from different views on saving, spending, and handling debt.
How to Talk About Money as a Couple
- Make time to discuss finances without distractions. Approach the discussion as partners working toward shared goals.
- Share your financial backgrounds, as each person’s upbringing and experiences shape their approach to money.
- Discuss what financial security and success mean to each of you. This will help align your financial goals.
If you grew up with a strict savings-focused approach, but your partner believes in enjoying their life, acknowledge these differences. Find a balanced approach so both of you can manage your need
Combining Your Finances
Should You Combine Finances?
There is no perfect approach here. Some couples prefer to combine their finances. Others keep their finances separate. Some couples choose a hybrid approach. Here are some common methods:
- In fully combined finances, all income goes into a shared or joint account from which all expenses are paid.
- In partially combined finances, people maintain individual accounts for personal expenses and a joint account for shared expenses.
- Others choose to have separate finances. Each partner keeps their own accounts, contributing separately to household expenses.
Pros and Cons of Each Method
- Fully Combined: Offers transparency but may feel restrictive.
- Partially Combined: Provides independence while managing shared goals.
- Separate: Offers autonomy but can make financial planning challenging.
If you choose partially combined finances, you can contribute to a joint account for household costs and savings goals while maintaining separate accounts for personal expenses.
Setting Shared Financial Goals
Types of Goals to Consider
- Short-term goals (1-2 years): Emergency fund, vacations, or high-ticket items like a new phone.
- Medium-term goals (3-5 years): Buying a car, planning a wedding, or saving for home improvements.
- Long-term goals (5+ years): Buying a home, children’s education, or retirement savings.
SMART Goals for Couples
SMART is an acronym for Specific, Measurable, Achievable, Relevant, and Time-bound. It is a useful framework that you can use to set clear and actionable goals.
Instead of simply saying, “We need to save more,” you can set a SMART goal. With a SMART goal, you can say, “We will save ₹60,000 over the next 12 months for a vacation by setting aside ₹5,000 a month.”
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