Love is blind, and your fate will bring your soulmate to you, but terms and conditions apply!
What terms and conditions? Well, for starters, how do you divide and manage money as a couple? Is it all 50-50, is it based on who earns more, or is it not supposed to be divided?
So, while your match might have been made in heaven, we can’t let the dreaminess of love take away its practicality.
You eventually have to come back to earth and have the money conversation with your loved one and understand how to handle finances in a relationship. Finding that sweet spot of financial compatibility between you and your partner is very important for a healthy relationship.
So, whether you are choosing your ‘life partner’, or in the stage of getting started to manage your finances in your relationship, there are a few key things you should know. This is why Kool Kanya is here to help you initiate the dreadful conversation about money and learn how to calmly and effectively manage it in a relationship.
Initiating this conversation might not be the easiest thing to do, but just the thing for you to make this conversation easier is Kool Kanya’s ‘Finance Pass: Personal finance made easy’. The Finance Pass is at your service to not only help you learn how to handle finances in a relationship but also learn everything about financial management, from investing wisely to tax filing.
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Some people view money as just something that needs to be saved, while some think it deserves to be spent. Both perspectives are valid; it’s just about who prioritises what. Before you and your partner tie the knot, ask each other this -
What do both of your financial lives look like after marriage?
Take baby steps in this discussion and try to patiently understand each other's perspectives, history with money, and how to take financial decisions together.
Financial questions to ask your partner
- Should we merge our bank accounts after marriage?
Once you both understand each other’s perspectives on money, an important discussion about how married couples should split finances has to take place.
Easy steps you implement to manage your finances effectively with your partner are:
a. Combine one hundred percent of your finances from current income and past savings to debt.
- This can help both you and your partner start afresh and have equal access to the finances.
b. Merge finances gradually by dividing incomes and depositing some in separate, and some in shared accounts.
- This is really helpful to gradually jump into managing the finances and take your time into financial planning together.
c. Have separate accounts and divide all expenses 50/50.
- This allows you to divide financial responsibilities just like marital responsibilities.
d. Have a joint checking account with each person depositing a certain amount.
- This enables you and your partner to have one place for all the money which makes keeping track of your finances easier.
2. How do we share financial responsibilities in our marriage?
We’re living in a day and age where marriage means equal responsibilities, whether it is for household chores or financial matters. So the inclusion of a financial plan in you and your partner’s life plan is of utmost importance. With this in mind, divvy up those financial responsibilities to set an effective financial plan.
Discuss what each of you is fit for. For example, one of you who is more punctual and likes ticking things off, can take up paying off bills, and the one who’s more calculated can be in charge of the savings.
This might sound complicated, but all it takes is some rounds of honest and effective conversation to do some couple financial planning and make a solid financial plan just like your life plan.
3. What will our budget look like?
Budgeting is one of the most important things when it comes to maintaining finances. Prioritise with your partner about where you want to spend. Once you compartmentalise and lock in the spending areas it’ll help eliminate numerous conflicts regarding spending and saving. This will help both of you be more mindful of money being spent, because once you marry, it is not ‘your’ money, it is ‘our’ money.
Living on a budget is always an important thing, whether married or single. So, discuss how your combined budget will look for an effective shared finance management. And to ensure that you are aligned, and that a proper financial plan is in place.
4. Are we as a couple prepared for an emergency situation?
Once you start the money conversation with your partner, you also need to speak about the protection of finances. These aren't the most fun conversations, and it might even be a little awkward, but you need to talk about it. You should also set up a regular checking system in place to ensure that you are protected for an emergency situation as a couple.
Some crucial things you can get started with to safeguard your money are:
- Creating a will. If you have one, then update it.
- Getting insurance against your income.
Marriage is a lot about love, but it’s also about living and sharing your life with someone.
The money conversation might not be an easy one to have, but it is a critical one and when all our lives we are taught to be independent, it's not easy to jump into it, especially financially.
This is why having conversations on finances sheds light on financial compatibility between you and your partner. With Kool Kanya’s holistic course ‘Finance Pass: Personal finance made easy, you can now have the ideal financial plan for efficient money management.
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