Financial Planning Tips for Couples: Books, Budgets, and More Resources
Money is one of the leading causes of divorce, according to a study published in the Couple and Family Psychology journal. It found that around a third of survey participants got divorced due to financial disagreements. This is why financial planning for couples is important even before marriage, to ensure that spouses can work together to manage finances.
Addressing financial issues as a couple isn’t always easy, as many people don’t know the steps they should take to make a financial plan. So, we put together the most useful financial planning tips for couples. With Career Karma as your financial advisor, you will discover mistakes to avoid and find the best financial planning resources for couples.
Top 5 Financial Planning Tips for Couples
Starting your life with someone else goes beyond just living under the same roof. You also have to consider other aspects that will change, like your finances, as you are now a family and have to share responsibilities. Below, you’ll find some financial advice and tips to help with your financial planning as a couple.
1. Discuss Your Money History
Of course, you’ll have your own personal financial history before getting married, including loans, debts, and investments, and the same will apply to your partner. It should be a priority to have a money conversation where you discuss each other’s financial past and net worth. This way, you will know precisely what you’re getting into, and learn how to set financial goals.
2. Set Your Family Financial Goals
As a couple, you should have financial goals that you aim to achieve, both together and separately. These goals will help you focus, work on a budget, and avoid reckless spending. Knowing what you want and marking it down as something to work toward will help you grow your finances and attain financial security.
3. Create a Family Budget
Creating a family budget is a great way to achieve financial harmony. With a budget, you can manage your spending, save money, settle debts, and reach your goals. The budget should include your combined monthly and annual income, monthly expenses, and the total amount of incoming and outgoing funds. This way, you can easily fish out unnecessary costs and encourage judicious spending habits.
4. Get Family Insurance
Health, car, home, and life insurance are the most important types of insurance coverage out there, so they should be a part of your family financial plan. Having insurance will help you avoid excess spending on unpredictable situations that could affect your bank account or credit score. If an emergency like a fire, illness, or natural disaster occurs, you’ll be protected.
5. Establish Family Savings and Investments
Having joint checking accounts and investments is one of the best and fastest ways to build your finances as a couple and achieve your long-term goals. You probably don’t want to become a financial advisor, but you can hire one to advise you on investments and help with monthly savings. This will help you become financially secure and protect your marriage from money issues.
5 Financial Mistakes to Avoid for Couples
When sharing finances with someone else, it is easy to make mistakes, especially when you have different financial ideas and goals. This section contains the top five financial mistakes that are common among couples and should be avoided.
1. Ignoring Money Discussions
Money can be a sensitive topic, especially with new couples. However, discussing money is crucial and should not be avoided because it could lead to future problems. Before committing to a long-term relationship or marriage, couples should discuss their student debt, credit card debt, their tax situation, retirement plan, money habits, their primary source of income, and their short-term money goals.
2. Not Agreeing on Savings and Investment Strategies
We each have our individual ideas, opinions, and strategies when it comes to money. Subsequently, because we have held these habits for most of our lives, it can be difficult to let them go. However, to have a marriage void of financial troubles, you should learn to compromise with your partner regarding savings and investments.
3. Failing to Track Your Spending
When you make enough money so that your family is comfortable, it can be easy to give in to the urge to spend recklessly without tracking. But this isn’t the best financial situation for your family. Couples should track their individual and joint spending to ensure that they aren’t exceeding their limit or putting the family in financial jeopardy.
4. Neglecting to Build a Budget
Living a worry-free life isn’t easy. It is achieved through hard work and consistency, and one of the ways you can remove financial stress is by creating a budget. Abiding by a budget will help you attain financial freedom. It curbs extravagance and encourages discipline, which is key to financial security.
5. Not Having a Financial Plan
This is one of the most common mistakes among couples. It is easy to put off creating a joint financial plan, but it’s crucial to avoiding marital issues. This plan helps keep you both on the same page and aware of financial goals that you want to accomplish separately and together. It will also help you control your income, expenses, investments, and savings.
How to Make a Couples Budget
Making a couples budget shouldn’t be too difficult. All you need to include is your total monthly income and expenses, then add it all up to find out how much you’re saving. Make sure you’re using all the right budgeting tactics, calculating all important expenses, including your credit card debt payments, loan repayments, insurance, rent, food, and childcare expenses.
Couples Sample Budget
|Expense or Income||Amount|
|Total Income||+ $90,000|
|Utilities and Bills||– $2,100|
|Home, Car, and Health Insurance||– $5,000|
|Debt Payments||– $12,000|
|Total Remaining||+ $27,400|
Financial Planning Resources for Couples
Financial stability is an essential aspect of life that almost everyone aims for. Most importantly, it can save couples from having marriage problems, and money problems are a common contributor to divorce, according to research analysis by the Institute for Family Studies.
Nevertheless, you can easily avoid financial fumbles with the right resources and commitment. Find below a few recommendations to help you learn couples’ financial planning. Rather than joining an online finance degree program, try out some of the shorter classes listed below.
Financial Classes for Couples
- Marriage Money Bootcamp. This course is designed to help newlyweds, or those in a serious relationship, to achieve their financial goals, including planning savings and spending.
- Let’s Talk: Couples and Money. This webinar focuses on teaching couples how to have difficult money conversations, reach agreeable conclusions, and make money decisions together.
- Money Management for Couples. This money management class for couples, hosted by Robyn Crane, will help you achieve your financial goals and achieve financial security as a family. Robyn is a money and relationship coach who aims to help avoid marriages crashing due to money issues.
- Budget With Your Boo. This modern class offered by the New School Of Finance focuses on making budgets with your partner. It’ll teach you to work together as a team to build a financially thriving future.
- Personal Finance 101 for New Couples Who Don’t Want to Split. This course is hosted by Udemy and teaches couples how to handle their finances without having issues. At the end of the class, you’ll better understand your finances and won’t have to worry about splitting up due to money concerns.
Financial Planning Books for Couples
- The Heart of Money: A Couple’s Guide to Creating True Financial Intimacy. Written by money coach Deborah Price, this book teaches couples how to communicate effectively about money. It will help couples build a sense of financial security and confidence.
- Financial Planning for Couples: How to Work Together to Build Security and Success. This book, written by Adriane G. Berg, aims to teach couples how to build their financial security while setting aside feelings and emotional reactions.
- Money and Marriage: A Complete Guide for Engaged and Newly Married Couples. This book teaches couples how to combine their financial strengths and work together to build a solid financial future. It is written by Matt Bell and includes a 10-step action plan for couples to follow to achieve their financial goals.
- Couples Money: What Every Couple Should Know About Money and Relationships. This book is written by financial expert couple Marlow and Chris Felton to guide other couples towards improving their financial situation and relationship. It includes the couple’s personal experiences and the experiences of others they have worked with over the years.
- 1001 Questions to Ask Before You Get Married. This book was written by Monica Mendez Leahy to help marriages last. It consists of questions that couples should ask each other before getting married to avoid future problems. Some of these questions include financial planning questions to ensure that each partner is on the same page.
Financial Planning Software for Couples
- HomeBudget. HomeBudget is a financial application that helps you track your cash flow, investments, and household expenses. Designed with families in mind, it allows you to sync accounts and view different spending categories.
- Personal Capital. Personal Capital is a finance software that combines your bank account, credit card, and investment information to help you make financial decisions.
- Honeydue. Honeydue is a financial app for couples that helps them track accounts and collaborate on money goals. You can also set up a joint account to help you and your partner maintain a healthy financial life.
- EveryDollar. EveryDollar is one of the best ways to stay accountable for your money as a couple or family. It can also be used to make budgets, set and achieve financial goals, and seek advice from a financial advisor.
- PocketGuard. This financial software is excellent for making plans and budgets, and starting joint finances. It can also help you create a personalized budget and save based on your goals as a couple.
Meet Your Couples Financial Goals in 2022
Setting financial goals as a couple is a great way to maintain a healthy relationship and healthy finances. If you don’t have money issues, your relationship will be much smoother. The best way to do this is with effective financial planning. All you have to do is discuss your money goals, then work together to achieve them by sticking to a carefully prepared budget.
Financial Planning for Couples FAQ
Couples can plan their finances by following the steps below.
• Discuss your financial history and net worth
• State your financial goals
• Create a budget
• Have savings and investments
• Get insurance
The best way for couples to handle finances is by communicating with each other and being honest. Each party should mention their debts, loans, investments, and savings to the other party, so that the couple can be fully prepared for the future. It’s also a good idea to learn financial management tricks.
The 50-30-20 budget rule is a technique that requires you to divide your income into three categories. Fifty percent goes to essential expenses, 30 percent goes into savings, and 20 percent is for extra costs, otherwise known as disposable income.
Unmarried couples can share finances however they choose to as long as they discuss the terms beforehand. Like married couples, they should set financial goals and work to achieve them. However, it is not advisable to have a joint account with a person you aren’t married to.