Preparation for financials in marriage??

[MarthaA562]

What is everyone doing to prepare themselves for the financial aspect of getting married. As we all know, this is one of the biggest causes of divorce. I want to make sure that we are set up for success. We cannot afford finance counseling, but for four + years, everything has been split down the middle, so I know that it will be a little different for us, We have decided to wait until we are married until we combine. I will be in charge of the budget and bills (I am more organized). I also bought a couple of books off of Amazon. We both have the same savings goals, but I know that we need to cut out the eating out at restaraunts (those $50 bills sure do add up!!!). What are you all doing to prepare??

[Heather]

I can tell you what we did and still do that works for us, but every "family" has to do what works for them.

I have my own checking and savings account and so does Mike. We also have a shared checking and savings account with both our names on the accounts, plus a shared ING Account that we funnel a bit of money to once in a while.

All of our shared bills (mortgage, taxes, heat, electric, cell phone, etc) comes out of the shared checking account automatically every month. If you can, set up auto-bill pay for any accounts that you can. It saves a big hassle every month for both of you. We both also have direct deposit at work which helps. Our shared accounts are with my bank so all of my check deposits into my checking account, and then I just transfer a certain amount to the shared for each check. Mike has a certain amount direct deposited directly into our shared, and the rest deposited into his own checking at another bank.

The easiest way to figure everything out is to just sit down with a spreadsheet and figure out all of your expenses, his expenses and your shared expenses. Make a real budget and figure out how much you each need to contribute per month.

We each do as we please with our own money/accounts and don't need to ask each other permission to buy anything as long as we have the money for it ourselves.

[NovemberGal]

DH and I are currently putting into effect exactly Heather's method. We just opened the joint account at my credit union a couple of weeks ago, and are in the processes of setting up the auto bill paying and figuring out how much of our paychecks we'll put into the joint accounts.

We don't have an ING account, but had sort of mentioned the idea in passing as something of potential interest. Heather, do you recommend it? How does it work?

[janeandreawong]

My fiance has been saving up for the last 2 1/2 years. He would like to shoulder most of the wedding expenses but I wouldn't agree with that. He earns a little more than I do. Right now we haven't talked about how are we going to split the bills when we are officially mr. and missus.. I think I will have to do the budgeting since he's not very good with it. I also have savings that I intend to use for emergency bills only.



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[Emily]

We have shared our money pretty much from day one.

We have a joint account and in that account is two savings account, one cheque account and then we have three credit cards just for back up.

at the moment because we are saving hard to buy a house when we go back to NZ we are able to save mine and live off Damons for the month. Every month at the beginning of the month I work out the bills for the month and also how much money we have left over for each week to get through till the next paydays (monthly) and put that money into one savings account and draw from it each week as necessary and into the other account goes my pay packet which we dont touch.

We pretty much decide together on any big purchases and if we are going out we always decide before we go out what our budget is for the evening, same if we are going out separately!

I take care of all the finanaces and am totally anal about it! Damon is useless with money so he is happy for me to take the reigns!

We do this at the moment because we are saving very hard but have talked about what we will do when we get back to NZ and have bought our house - we want to make sure we have a bit of freedom with money each when the time comes we will have a separate account each and each pay day we will put a certain amount into those accounts for 'play money' i.e. we can spend it on whatever we want without having to consult the other!

[Heather]

Originally Posted by NovemberGal

We don't have an ING account, but had sort of mentioned the idea in passing as something of potential interest. Heather, do you recommend it? How does it work?

Absolutely recommend it. The ONLY issue that I have with it is I keep forgetting about it, lol. I need to set up a direct deposit from our shared checking to funnel money into it for every paycheck. Their interest rate is higher than a normal brick and mortar bank because they don't have the same expenses and can afford to give you a higher return on your money. Just go to ing.com and read through the site. It's really, really easy to use and get started.

Also, forgetting about it once in a while isn't necessarily bad thing either. It means I/we are not touching that money at all. It's just sitting there gaining more interest.

[cm-photographics]

I would agree with basically everything that has been said on here so far. You have to find what is right for you personally... There is no set formula as to what will, or will not work... Here is how Erin (my wife of 16 months) and I manage our finances:

We take a look at things from a yearly perspective. She makes "x" amount, I make "y" amount, and together it gives us "z" amount. In our case, I make about 55-60% of the total income. So, I end up paying 55-60% of all of the fixed expenses (mortgage, student loans, credit cards, etc). Then whatever is left over after I pay my 60% can go towards whatever I want, and the same is true for Erin. I use mine towards camera/computer equipment, and she buys "Sex and the City" and "Grey's Anatomy". The key to success in finances, is setting up realilistic goals as quickly as possible, and having a good understanding of where you are now financial, and where you want to be in 6 months, 1 year, 3, 5, 10 years, etc. I have a spreadsheet set up with all of our expenses (estimated and actual) for at least 12 months in advance. This way I know which months might be tighter than others, etc. As long as you have an open line of communication, and you are both open and understanding, then everything should work out fine.

Oh, and use credit cards wisely. If you have credit card debt currently, open up a new card, that has a low intro APR, and transfer the balance. Keep on transfering balances back and forth, until everything is paid off. I have been doing this for 2 years... I started with a 18,000 balance (now down to 3,000), and my credit cards (3 of them) had a total limit of 21,000. Now, I have a limit of over 50k, and a very solid credit score. Plus, I am not paying more than 1.9% on any of my debt. I even financed my car through my credit card, and got it paid off in 18 months at 0% instead of 3 years at 7.95%.

Can you tell I was a mortgage broker for 2 years? I helped people with a LOT of debt...

[imstilldreaming]

We currently share all expenses too and have a shared checking and savings account. We plan on keeping it that way and have tossed around the idea of each having our own checking account for 'fun' things, like if I just HAVE to get a pedicure or something like that. However, as things stand right now, it makes more sense for us to continue sharing until we get out of graduate school. We ended up sharing funds since I probably make 75% of our income and it didn't make any sense for me to just be hoarding money while FH could barely help pay rent and groceries.

We are currently throwing as much money as possible to student loans and into savings and living way below our means. I guess I will appreciate it down the road?? I hope so!