When couples decide to say ‘I do’, there is nothing short of fairytale magic, love and adoration for each other. Even if you’ve agreed on your Gula Melaka wedding cake without batting an eyelid, the question is, do you agree on financial matters? Most couples save financial discussions for later, and some never have them at all. This is a fatal money mistake a couple can commit.
There are so many ways to work around finances when you’re a couple; there are joint accounts, separate accounts, splitting expenses and all types of financial arrangements that couples follow these days. Of course, as financial matters are still a leading cause of divorce, it is important to talk about your financial situation to avoid making common mistakes.
Money Mistakes 1: Not Setting Goals
You may be financially secure at the moment, but what are your long term plans and goals? Goal setting can be very important and has been proven to help many couples focus on their finances.
Whether it’s about kids, retirement, savings or just a rainy day fund, not setting long-term financial goals can have a significant impact on your financial and marital success.
Money Mistakes 2: No Accounting
Accountability is key, especially in a marriage when couples need to rely on each other and have a system in place. One mistake that is prevalent, especially with young couples who are starting out, is not deciding how accounts will are to be divided and setting strict guidelines on who pays for what.
Some working couples prefer to keep accounts separate, which can make it easier for some. Traditionally, couples will join their accounts, but often make a common money mistake by not deciding how purchase decisions are made, and how much discretionary spending is reasonable.
Money Mistakes 3: Not Giving Your Spouse Some Credit Where It’s Due
In Singapore, when couples marry they become responsible for each other’s credit. Although many couples with joint accounts will share the finances, it is never a smart financial decision to let one spouse bear all of the credit.
Sure, someone might have much better credit, but try to keep a balance, which might allow you to secure better future rates on loans, mortgages and maybe that retirement home.
Money Mistakes 4: Not Having Frequent Money Talks
We all know that communication is key in any relationship, whether it’s business partnership or marriage.
However, when it comes to romantic relationships, people only tend to communicate about finances when there is a challenge or hurdle in the way. Not keeping an open communication line with regards to reaching your financial goals can be a major money mistake and lead to the uncomfortable conversation down the road.
Also, some couples will inevitably find themselves in a better financial position, making more money in the future as opportunities arise.
Decide whether you will put the money into savings or how your new income will be spent. Many couples take it for granted – don’t make this money mistake.
Not Looking Far Enough into the Future
If your spouse comes from a wealthy family, you may end up conveniently sweeping the retirement conversation under the rug. Even if you stay together as your wedding vows say you would, waiting for an inheritance is not something you should gamble with, no matter what.
Consider starting your retirement plans immediately after marriage, it is never too soon to think about the future!
Sure, money can’t buy you love, but avoiding common financial pitfalls can give you and your spouse more time to focus on other, more important things.
This article was first published by The New Savvy.
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