This article was last edited on Oct. 27, 2015. For updated information on taxes and marriage, visit Filing Taxes as a Married Couple.
After saying your wedding vows and celebrating on your honeymoon, savvy newlyweds are prudent to take time to make financial plans together. Financial mistakes can cause stress in a marriage and even lead to a marriage ending.
Don’t let that happen to you. Keep the marital harmony alive with these five tips for financial planning from TaxSlayer experts.
Set financial goals. Communication is key for a blissful marriage, especially when it comes to money. Take time after the honeymoon to sit down with your spouse to talk about your goals. Discuss where you want to be in five years as well as your long-term goals. Talk about your expectations for leisure, retirement, children’s education, buying your first home and emergencies. Don’t stop at talking. Write down your goals and you are more likely to follow through.
Create a budget. It’s important to know your combined monthly income and what that means for your spending. Look at your paychecks and any other sources of income. Make a detailed budget for housing, groceries, entertainment, leisure and other routine costs. Don’t forget to plan for payments on student loans and other debt.
Start saving. Now that you’ve talked about how you will spend money, don’t forget to start saving together. It’s important to have a financial cushion for emergencies and to plan for retirement. Celebrate your first year of marriage together but don’t overindulge. Find ways to be frugal such as putting a limit on nights out, and be smart about discretionary spending on things such as cable and vacations. If you made a goal to purchase a home together, you might need to set aside money for a down payment.
Choose a financial keeper. Many couples find it helpful to designate one spouse to oversee financial matters. Each newlywed should have input into goal setting and budgets, but choosing one person to pay the bills and keep financial records can eliminate confusion. Remember to share important financial decisions and changes with your spouse.
Manage your bank accounts. Merging your finances can be a difficult task but you might want to consider a joint banking account. A joint account is a good idea for household spending. If you are hesitant to merge all of your accounts, you can each keep a separate account for personal spending but make sure your spouse is clear about its use.
Money talk doesn’t have to put a damper on your first months of marriage. Have the conversation and then carry on with your new life together. Congratulations, newlyweds!
Check back soon for tips on filing your taxes as a married couple.