Financial planning for newlyweds
Your financial health is one of the most important factors a couple who has recently tied the knot should discuss and agree on.
If you are getting married soon or have recently tied the knot, you will know that building your life together can be overwhelming and are there are so many things to consider, said an African Bank spokesperson.
“One of the most important factors to discuss and agree on is your financial health as a couple,” said Mellony Ramalho, African Bank’s Group Executive: Sales, Branch Network.
She said it is important to talk about your financial aspirations and habits as a couple.
“Consider the expectations you have for yourself and your partnership and be honest about your strengths and weaknesses. Make time to sit together and really have a heart-to-heart talk. Remember that people come from different families who approach money in different ways. Be willing to listen to your partner and understand how he or she views money.”
Once you’re on the same page, she suggested identifying the total income available for your household and formulating a budget as a good place to start.
“If need be, track your spending for a month or two before you set your budget, to get a more accurate outline. Set a maximum amount for big ticket expenses and decide what type of purchases you want to make using credit cards and personal loans. If you want to buy something over and above this amount, you should discuss it with your partner, not necessarily for permission but for clarity and agreement,” she said.
Another important aspect to address is financial responsibilities and roles. Mellony recommended designating specific shared financial responsibilities to each person, based on their earnings capacity.
“Decide how to set up your accounts. Will your accounts be joint or separate or will you have a combination of the two? These are details that should be discussed and decided on in advance. Factor in what you have that is existing and work from there.”
“Savings are key so set manageable financial goals for yourselves in this regard,” she added. Mellony suggested having two types of savings for both short- and long-term goals. “For example, you can use a fixed deposit account or notice deposit accounts for saving, in conjunction with a tax-free investment account to plan for different types of expenses, from your retirement to your next holiday.”
“Ultimately, if you want your life as a couple to be as stress-free as possible when it comes to money, plan together. Making sure you have covered your financial security is important, even if it means having potentially uncomfortable conversations. Remember to meet regularly and speak honestly about your money,” she concluded.
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