7 Tips for Newlyweds on Combining Finances

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My younger brother and his girlfriend of over seven years are finally getting married. Despite spending much of their lives together, they’ve never lived together and are only now starting to explore each other’s finances.

When my husband and I got married, we had a brief, naive conversation about finances that went something like:

“How much do you make?”

“I make this much.”

“Cool, I make this much. That should be enough to live on, right?”

Oh, to be young and naive again.

Because we knew nothing about each other’s finances before getting married, we had many arguments during our first year of marriage.

In the end, it worked out, and my husband and I have now been married for six years and understand money management much better.

But we could have avoided a lot of heartache. Here are some pieces of wisdom that I shared with my brother and will now share with you for newlyweds looking to combine finances.

1. Know Each Other’s Debt

How much debt do you both have combined? I discovered my husband had about $2,000 in credit card debt shortly after getting married. Then he learned I still had about $20,000 in student loan debt. If you’ve decided to get married, you need to have a serious conversation about how you’ll each pay off your debt. Will you combine forces and pay it off together? Or will that cause resentment? Maybe you’d prefer to each pay off your own debt? Debt can definitely delay the decision to combine your finances completely.

2. Know Each Other’s Credit Score

If you’re planning to make any big purchases after getting married, such as a house or a car, you’ll both need good credit to get the best possible deal. If you wait to find out your partner’s credit score, you might be unpleasantly surprised if their score is much lower than yours, affecting your monthly payments.

3. Set Up a Budget

It’s time to figure out the cost of living. While you may save money with two incomes, ensure you don’t go overboard with spending or set yourselves up for an unsustainable lifestyle.

4. Communicate Weekly

You need to talk about your finances regularly. Discussing money can make people uncomfortable, but open communication is crucial to avoid unnecessary arguments.

5. Have a Spending Limit

Set a spending limit that either of you can spend without consulting the other. For my husband and me, it’s $100. While not a huge amount, it’s significant enough to impact our finances, and I want to ensure it’s worth it.

6. Set Up Fun Funds

My husband has an account that gets a certain amount of money transferred to it every payday. He can use this money however he chooses, and I don’t have a say. This has resolved many issues in our finances.

7. Agree on Your Long-Term Financial Goals

When do you want to buy a house? What kind of retirement do you envision? Do you plan on paying for your children’s college tuition? These are all expensive financial goals that require extensive planning and saving. Ensure you’re both on the same page, and never assume your partner has the same ideas as you regarding money.

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