Today, a growing number of millennial couples are seeing themselves struggling in a financially obscure zone, starting with the fiscal responsibility of the first date to a heavy-on-the-pocket diamond ring bill.
Statistics from a Pew Research Center survey suggest that only 26 percent of young adults between the ages of 18 and 32 are married. On the other hand, 48 percent of Baby Boomers and 36 percent of Generation X tied the marital knot during that age range.
Whether for financial/personal reasons or simply dropping the idea of marriage all together, millennials in long-term relationships that are delaying marriage have become more prevalent. According to US money and dating experts, miscommunication is the primary factor, majorly mortified for financial issues that the couples face in the long-term relationships. On the contrary, communication is the most effective remedy to improve interpersonal relationships.
Here are six easy tips for sharing finances in a long-term marital relationship:
1. Have an Honest Discussion About Your Finances
If you are serious about your relationship, then avoid an unnecessary delay in discussing your personal financial matters with your spouse-to-be. You should initiate the discussion as you want to create a sense of trust and safety, typically by highlighting your current financial circumstances and concerns. Such conversations can result in plans for sharing finances to maintain your ideal lifestyle and career aspirations. It also brings a couple closer together.
In fact, regular money-talks help couples understand how money should be spent more effectively. Thus, aim to set aside a scheduled time every week in order to have such financial conversations. Though your saving and spending patterns may be quite different, communication helps to design a budget that suits both individuals’ needs in a relationship.
2. Create a Joint Account for Entertainment and Vacation
Maintaining a separate account for funding expensive leisure and entertainment activities allows a couple to financially work together towards mutual goals like vacations, shopping, event celebrations, and dining out. A joint savings account for your goals of home renovations or buying a family car is a good idea. Budgeting a few months early, individually, can serve as an alternative to a joint account for sharing finances.
3. Stay Away From Cosigning Debts
Although this choice typically depends on how much you trust your partner, experts often disagree with the idea of cosigning debts for couples as you could be forced to pay the bill alone if your partner fails to do so. You might be interested in cosigning a loan as it can charge a lower interest rate, but it can backfire significantly as well. As personal finance management and business bookkeeping should not be mixed, cosigning debts should also be avoided for sharing finances.
4. Consider Convenience and Comfort Of Individual when Deciding who Pays the Bill
It is norm that the male individual in a relationship will pay the date night’s bill. However, splitting a dinner bill is a good way for sharing the financial burden. In either case, experts suggest that couples should do what they feel is convenient and comfortable instead of putting unnecessary burdens on each other. However, when you are in a significant relationship with your partner and are both equally comfortable in contributing towards the cost of your relationship, then such a step makes a perfect sense.
5. For Couples Living Together, Consider These Options
Create a legally enforceable contract before making any move together. Couples should avoid being in a hurry when they decide to move in together. In the case you do not live together in the future or the relationship ends, one of you could be at a major loss in the absence of a contract proving joint contribution for sharing finance or home acquisition. Thus, a contract in writing is essential that may also include pets, cheap and expensive shared personal possessions and belongings, and who gets the property’s ownership if, in case, you split up. Though you may find it awkward and frustrating, you are simply ensuring each of your financial and residential security.
Take Advantage Of A Joint Account To Pay Your Bills
Couples should consider setting up a joint bank account for sharing finances where they can make regular deposits of a certain percentage from their earnings to be used for paying off major bills like utilities and rent or mortgage payments. When deciding to merge most of your income, consider separating accounts for discretionary spending or flush money on items like clothes, accessories, and weekend activities.
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