Being newlyweds does not always mean being a new couple living under one roof. Many newlyweds have been keeping house together for a while before the ceremony. Many of the financial issues that confront newlyweds may not necessarily apply to these couples.
However, good sound financial advice can be a great asset no matter when the advice is received. For young couples who are just preparing to begin their life as man and wife under the same roof, wise financial decisions at this early point can mean financial ease a few years down the road.
This is the perfect time for them to start saving for the future so that there are no financial constraints in the future regarding kids’ future and PillarWM is an excellent platform where they can work it out as it is called wealth management for a reason.
- Pay yourself first. This advice means that you should make your savings account the first bill that you pay each week. Even if it means delaying a desired purchase, faithful savings will bring far greater rewards than any short term pleasure from a hasty purchase.
- Make sure that you reach at least 3 months net pay in the bank as fast as possible. This is important for two reasons. The first reason is to be prepared in case of an illness or an emergency. You might need a small pile of cash to get by a financial speed bump. This cushion will make that happen.
Second, you could lose your job. It can easily take a few months to get your employment back on track. If both spouses work, the three months net pay will carry you farther than that and keep you from just taking the first job that comes along. You bills will get paid and your credit history will continue to look positive.
- After you have your cushion account, begin to save for a house. Most couples struggle to come up with a down payment for their first house. If you plan right, you should get some income tax refunds and other bonus types of money. Put this money straight into this savings account until you can purchase your first house. Buying a home is the best step a young couple can make.
- By the time that you buy your first house, you need to have established some form of retirement savings plan. This plan does not have to be as aggressive as it should be later in life. However, saving something every week or month needs to be a priority. Small amounts saved early in life grow into much larger amounts with the passing of many years. 401k and IRA accounts are a good place to begin. You get to save tax money while you save retirement funds. Also, many employers will help fund a 401k account. This is free money that you will not get if you do not participate.
- Keep unsecured debt extremely low or non-existent. Credit card debt can eat up all of your income if it gets out of control. Pay off credit cards as quickly as possible and keep the balance as low as possible. Avoid payday loans and pawn shops.
- Put each other on an allowance. Set a weekly limit regarding how much can be spent by one partner without consulting the other. Keep this amount low. Figure out how much is needed for commuting to work, snacks, lunch, etc. The amount for each partner may not be exactly the same. For things like eating meals out together, set this money aside separately. Allow a little extra each week in the allowance amounts for saving toward gift purchases for each other for special days.
- Make a practical budget that allows for housing, food, clothing, medical, and fun. This is mandatory if you are going to be able to meet your savings goals.
- Work on finances together as much as is possible. That way neither party is tempted to hide money or expenditures that may lead to future battles over money.