Almost all couples have money problems, particularly during the early years of their relationship. Usually they are just starting out in their careers and their take-home pay isn’t very much, or they have very bad money management problems, because before they were married they had no commitments or discipline to rein them in.
When you are single, you can find a lot of things on which to spend your money. When you are a couple you can find more than double that number of things on which to spend money. So what you have to do is work up a financial plan.
The first item on the credit side of the ledger is the list of both of your incomes. Then you begin the debit side. The first item should be a deduction of ten percent of the combined net wages. This goes into a savings account for “a rainy day.” It follows the old adage to “pay yourself first.”
The debit side continues with all of your joint expenses: rent or mortgage payment, utility costs, telephone and other regular expenses. Then list all of your individual expenses such as car payments, car insurance and any other debts.
Add up both columns and deduct the debits from the credits. The remainder is how much you have to spend for food and drink, gasoline and other monthly expenses.
“Don’t spend money you don’t have” is the cardinal rule of a sound financial plan.
“Don’t borrow money to pay borrowed money” is another good rule to follow.
If you are not planning on combining your earnings and financial matters, you should still establish a plan. List all joint expenses, plus establish a budget for food and beverages. The total of this will tell you how much each of you should contribute to the household fund.
You may each arrange for a direct deposit of your share of the household expenses into a joint bank account from which all these bills will be paid. You should each have an ATM card on the account so that you may pay for groceries and other household items from your joint account.
Each of you should pay your own individual expenses after first “paying yourself.”
At the end of the year, or at a predetermined time, any excess funds in the joint account can be used to throw a party, place in a joint savings account (the smartest move) or buy something nice for the house.
If you failed to establish a budget plan before you began cohabitation, you may have incurred some debts you need to handle jointly. Set up a plan after-the-fact and proceed as above. If the debts are large, you may consider a joint loan to pay them off, with the payment amount being added to the household debit side of the ledger.
If the financial problems are greater than you both can cope with, consult a financial advisor, who will probably take the same actions as described herein.
Financial problems can put a lot of pressure on a relationship, maybe even fatally damaging it, so don’t neglect them.