When you share a household with someone, your life changes—and your approach to managing your money may change as well. The good news is that we have a few tips that can make it easier.
At some point, you will have to ask yourselves some money questions—questions that pertain not only to your shared finances but also to your individual finances. Waiting too long to ask (or answer) those questions might have some consequences.
First off, how do you propose setting fundamentals and priorities? Consider if you should open a joint account or keep some accounts separate. Also, how should you title assets that both individuals bring to the relationship? Thinking about your priorities, how much money should you put into your emergency fund considering your combined expenses? These are just a few of the questions to start building shared financial fundamentals.
How much will you spend and save? Budgeting can help you arrive at the answer. A simple budget, an elaborate budget, or any attempt at a budget can be very informative and eye-opening. Working and agreeing together on your budget can help you align your spending and savings goals.
How often will you check up on your financial progress? When finances affect two people rather than one, reviewing statements can become more important. Checking in on these details once a month (or at least once a quarter) may keep you both informed, so that neither one of you has misconceptions about household finances or assets. Arguments can be avoided when money misunderstandings are resolved through checkups.
How will you be intentional with your finances? Partners who are inattentive or nonchalant about financial matters may encounter more financial trouble than they anticipate. Watch where your money goes and think about ways to plan for your shared future. Work together to set short-term, medium-term, and long-term objectives. Being intentional will help achieve the money goals you set.
Communication is key. Watching your progress together may well have benefits beyond the financial, so a regular conversation should be a goal for partners.
Information in this material is for general information only and not intended as investment, tax or legal advice. Please consult the appropriate professionals for specific information regarding your individual situation prior to making any financial decision.
Email me your questions at financial.freedom@lpl.com or call 541-574-6464. You can also post you question on our Facebook page: https://www.facebook.com/FinancialFreedomWealthManagementGroup
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