A big part of that new life is sharing your finances. You may be merging bank accounts, making major financial decisions together, and filing joint tax returns. How do you keep track of everything now that you’re planning with another person? The answer is budgeting — looking at how much money you bring in versus how much money you are spending each month. Below are a few tips for newlyweds just getting started on their financial future.
Make a Budget
Seriously, just making a budget at all puts you light years ahead of most other couples. According to the National Federation for Credit Counseling, only 44 percent of people even bother tracking their monthly income and spending. Fortunately, budgeting is easier than ever. You don’t need to make your own spreadsheet when you have dozens of budgeting programs and apps at your fingertips. In fact, your current online banking service may already have an integrated budgeting app . Once you start following the money, you’ll be amazed at how it can change your life.
Honesty is always the best policy in relationships, and financial honesty is no exception. A Ramsey Solutions survey revealed that disagreements about money is the second leading cause of divorce, behind only infidelity. So, if you’re hoping for a long and happy marriage, be an open book with your partner on money matters. Talk about your financial history, both good and bad, and never hide any unexpected spending or income. It’s helpful to have an honest conversation about where you both want to be financially in 10, 20, and 30 years. When you set goals together, you can build those goals into your budget.
The 50/30/20 Rule
A classic way to break down your monthly after-tax budget is by using the 50/30/20 rule. It works like this:
- 50% should go towards necessities including food, housing and transportation.
- 30% should go towards wants, such as entertainment and travel.
- 20% should go towards savings and paying off debts.
If you see that your wants or needs are straying too far above those percentages, that may be a sign to adjust your budget. You can always put more towards the savings category but remember – it’s important to balance enjoying the present day and enjoying your future.
Automate Your Life
Now that you have a budget, you have to put it into practice. Great news: you can set up your accounts to do most of the work for you. From automatic monthly bill payments to automatic transfers from checking to savings, you can use digital technology to keep track of where your money goes.
Set up online banking with BayCoast and get control of your finances right at your fingertips. You can access your account by computer, mobile phone or tablet, our BayCoast ITM/ATMs, or by phone at 888-533-6695.
BayCoast Bank makes it easy to budget for a brighter future by offering all the tools you need to help you get started. Don’t forget, you can track every dollar you spend with our free Money Management tool. If you have questions about opening accounts, online banking, or other money matters, contact us today!