How online budgeting tools can help you plan for your future together
You may be winning when it comes to love, but how are you in the financial department? There’s a lot to talk about when it comes to building a successful relationship. Where will you live, how many kids will you have, and whose job is it to take out the rubbish are just a few of the conversations that lie ahead.
Unfortunately, one conversation that gets put off too frequently is a serious discussion of finances. Whether you’re in a long-term relationship or a new marriage; your financial status is a big part of your life together.
For whatever reason, many couples avoid this conversation until they are forced to have it. Unfortunately, that time may come in an uncomfortable situation, or even an emergency. For those reasons, it’s best to have this conversation early.
Still hesitant? Relax. Here are a few easy tips for navigating the conversation along with a few ideas for couples who want to manage their finances effectively.
First, Have the Conversation
It’s said that showing up is half the battle. In this case, simply having the conversation is a great first step. It’s best if this conversation takes place before any big life decisions, such as moving in together or marriage.
However, if you’ve already tied the knot and signed the lease; have the conversation sooner rather than later.
Discuss Joint Bank Accounts
Believe it or not, this is one of the details that often gets overlooked by couples planning their future. There is no right or wrong answer to whether you should combine bank accounts. Even married couples sometimes maintain at least one personal account.
There are pros and cons to merging, keeping them separated, or even doing both. Combining accounts can help build trust in any relationship, however it’s nice to maintain some independence as well. Have the conversation and decide which option works best.
Discuss Financial Goals
Prepare lists of your personal financial goals. You may want to eliminate your debt, save for retirement, or buy a house. Compare your lists when completed and you may be surprised at how many goals you share. Combine them and create a new list of your goals as a couple.
Design a Budget
When it comes to planning your life together, creating a budget might not be the first thing on your mind. However, now that you’ve discussed the current state of your finances as well as your goals; a budget is the next step.
One of the reasons many couples skip this step is because the idea of designing a budget can be intimidating! However, you don’t need an accounting degree or a personal finance manager to plan for your future.
Look at your combined income and expenses. A few things to consider:
- How much should you put into savings?
- How much should you allocate towards eliminating debt?
- How much discretionary income do you have?
Truthfully, there’s a lot to consider when preparing a budget which is why many people put it off. If you need further help, online budgeting tools can help.
Plan For Emergencies
Discussing finances may be uncomfortable, but planning for an emergency is something many couples don’t want to even think about! However, it is important to address the “just in case” situations, such as sudden home repairs or an unexpected medical expense.
Discuss how much to set aside, and plan for those “what if” moments. As the saying goes: if you fail to plan, you plan to fail!
Plan For Retirement
No matter your age or where you are in your career; it’s never too early to begin thinking about retirement. Like planning for emergencies, this is sometimes ignored when younger couples are more involved in thinking about buying a home, saving for a wedding, or planning a family.
If retirement seems far away it can be difficult to picture what your golden years may look like. Use an online budgeting tool like PictureWealth’s retirement calculator and get a glimpse at what your financial future may look like.
Have Regular Budget Meetings
No, you don’t need to put on a suit and create a fancy presentation, however it is important to check in on your budget from time to time. Pick a day each month to sit down and go over your finances for that month.
Look at whether you’re decreasing your debt, increasing your income, or if your spending is within the acceptable range you’ve set. Use this time to discuss upcoming bills, any expenses that are on the horizon, and more.
Some couples may need to meet more frequently than once a month, others less so. In either case, pick a day and stick with it. You can always change it later.
Need More Help?
If all the above still sounds intimidating, PictureWealth can help! PictureWealth is an online tool that puts the power of a personal financial manager at your fingertips. We look deep into your finances to gain a better understanding of them, and help you plan accordingly.
You’ll easily be able to see where your money is coming from along with ways you can optimise your earnings to meet your goals. PictureWealth also helps give you an overall picture of your current financial status including your cash flow, net worth, superannuation, and more.
With powerful yet easy to navigate features, PictureWealth is a simple, pain-free way to get your finances in order without needing a degree in financial planning.