Ozzie couples, those newly engaged or are already planning to move in togetherin Melbourne, Brisbane or Newcastle spend a lot of time dreaming about their future – what kind of house they’ll live in, how many kids they’ll have, where they’ll have their first honeymoon, etc.
However, what they seldom if at all talk about is how they’ll pay for all of it. Based on several studies, not talking about finances before tying the knot is one of the biggest mistakes a couple can make.
Here’s a quick guide to the important conversations every couple needs to have.
How do you handle money? Before talking about wedding venues or joint bank accounts, the first things couples should do is to start talking about their backgrounds. Get a sense of how the other person approaches money – their attitudes toward spending. What are yours? What did both of your parents teach you about money spending, saving, and philanthropy?
This might be the first time you’ll talk about money habits and try to align it with someone else’s. This can get uncomfortable for sure, but once you’re married, you need to deal with compromises. Tackle these three things as you talk:
Financial priorities. A double income doesn’t mean unlimited spending power. You need to plan whether to get the wants or the needs.
Life goals.Are there debts to be paid off? Does a partner plan on staying home with kids? Where do you want to be in 10 years’ time?
Retirement plans. Couples should think carefully about when and where they desire to retire as well as how much they want to have saved up by then. This way, every decision made will be towards that goal.
What are your assets? Be transparent about your financial situation. Consider these essentials:
Saving accounts. Sit down with a financial advisor to plan your 401(k) accounts and determine what will happen to them in case something happens to you.
Debt. Student loans, car loans, credit card bills, etc. should be paid quickly. It’s also imperative to know what happens to an individual’s debt after they die, so learn about the property laws in your state.
Beneficiaries. As you become a couple, you need to think about your beneficiaries and what will be appropriate for your situation.
The bottom line
For most couples, a starter home after marriage is the way to go. If you plan to live in Newcastle, Australia, you’re well aware of First Homeowner grant, which gives you financial support and flexibility. Do check out the Home Loan home page of Newcastle Permanent to see fixed-rate home loan, which is the first and most stable choice for new home buyers.
Money is a major source of tension in relationships, and hey, it’s also a top predictor of divorce because financial stress and differences in values can put a strain on the marriage. Now that you know these things, make sure that you sit down with your SO to straighten things out or plan your financial future together – you’re doing each other a huge favour now and in the future!