By: RiverWood Bank
The wedding season is ramping up as the temperatures rise, and newlyweds are settling into marriage, including managing their finances as a pair. Couples should waste no time addressing how they will handle money issues as spouses and financial partners.
"Developing a financial plan can often take a backseat to the excitement of a wedding," says Paul Means, RiverWood Bank CEO. "But it's important to remember that this is not only a marriage of hearts but also a marriage of finances." To help couples start their journey on strong financial footing, here are some post-wedding money mistakes to be aware of:
$1 AVOIDING THE MONEY TALK
Discussing your finances can be a bit uncomfortable for many couples, but those who tackle it head on will be better for it. Understand your partner's financial goals and spending habits. While you may have different answers, this conversation can help you develop an approach to money management that works for both of you.
$2 NOT SETTING A BUDGET
A mistake many couples make is not establishing a budget early on. After assessing your finances as a pair, determine how you'll spend your money each month. Are there certain expenses that you should be cutting back on and others you should be saving up for? Coming to an agreement on these things and setting a budget will be beneficial for your financial health and your relationship. There are many online tools that can be used to build and monitor a budget.
$3 NOT HAVING A PLAN FOR YOUR ACCOUNTS
There is no "right" way to manage your accounts. Couples can choose to have exclusivity joint accounts, a joint account as well as separate accounts for saving or personal spending, or keep things entirely divided. Discuss your preferences together and decide what makes you both the most comfortable. If you aren't sure what your options are, talk to a local banker.
$4 FAILING TO SET UP AN EMERGENCY FUND
Life is full of surprises and unfortunately some of these surprises can be expensive. Having an emergency fund will help you avoid precarious financial situations should something come up. It's important that you decide together how you'll set aside the money.
$5 NOT ESTABLISHING A MINIMUM COST FOR DISCUSSING BIG EXPENSES
While not all purchases demand a conversation, more expensive ones that impact the family budget should. Determine what that threshold is as a couple. For any expenses above that cost, you both should be in agreement on whether it's a necessary purchase.
$6 FORGETTING TO UPDATE YOUR BENEFICIARIES
Now that you've officially tied the knot, you should likely identify your spouse as the person who will receive the benefits of your will, life insurance policy, and financial accounts like your 401(k), checking, and savings. Don't make the mistake of waiting for an emergency to arise to handle this.
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