Budgeting in a new marriage can be difficult. Separate accounts or joint, save or spend, and so many other questions to answer. Take it step by step and talk about how bills are going to be paid.
4. +
Separate Accounts
Some couples choose to keep completely separate accounts
once married.
Splitting bills directly down the middle or each paying for
different parts of the monthly budget.
Positives: Clearly set accounts with no fighting about frivolous
accounts that may be different priorities for each other.
Negatives: Each adult may make a different salary and cause
difficulty with having enough money to pay their bills.
5. +
Joint Accounts
All money goes into one account and is combined for all
expenses. Both couples save, spend on bills and personal
expenses.
Positives: Both have shared control of the money. There is no
fuss of who makes what and all money is shared for bills.
Negatives: Both have equal control over money can mean
agreeing on what the money will be spent on. That can take
great compromise and communication skills.
6. +
Separate but Together
Take 90% (or other agreed upon amount) of each check and
have it automatically deposited into the joint account.
The remaining 10% is for personal expenses.
Positives: Each person can feel as if they are contributing to
the household expenses and yet retain some independence.
Negatives: Separating what counts as personal versus what
counts as joint can be difficult. Some people may consider a
date as a joint expense, but if it was only one person’s idea or
favorite place, then who does the expense go to?
8. +
Mortgage or Rent
Mortgage: This should be the first expense considered when
making your budget. It is usually your largest payment and the
budget should be set up around it. And don’t forget to budget
for these extra fees:
Property taxes
Homeowner association fees
Unscheduled home improvements
Rent: If you’re renting, put aside some money each payday for
a down payment on the house.
FHA loans are a good option for first time buyers and usually require
a smaller down payment (3%).
9. +
Food
Keep track of your spending on your groceries, eating out at
restaurants and even that latte you pick up every morning.
At the end of the month, look for spending patterns on discretionary
items that can be cut back.
The food budget quickly adds up with over 1,000 meals eaten
per year per person. Keep in mind that while we try to make
every meal ourselves, many don’t.
Food items are various and extensive while also being expensive.
Make sure you shop what is on sale and stock up.
Check to see if your favorite grocery store has a loyalty card or
digital coupons for extra savings.
10. +
Utilities
Electricity / Gas: These utilities are deregulated in many states.
Shop around for a lower cost provider with the same service
benefits.
Try to use fans in the summer instead of air conditioning to keep
your bill down and layer up in the winter with some blankets. Also,
invest in sealing your windows and doors.
If you have the option in your apartment, get the garden level for
better insulation.
Water: Consider changing your showerhead to save water and
money on your bill.
Renters: Different apartments have different utilities included in
rent, so ask before signing your lease.
11. +
Technology Needs
Cellular Phone: Do you need the latest fancy smartphone? Or
can you get by on a pay as you go model? Look at the cost for
each and determine if it’s worth it over the life of the contract.
Internet: Evaluate what your needs are before deciding on
which service to buy. Gaming, email and social networks all
require different amounts of bandwidth.
Cable: Forget the bundling! Make sure you are getting the best
rate; don’t just do what lasts for three months and read the fine
print.
Home Phone: Getting a landline is an important safety feature
for every household. It’s budget friendly and offers privacy and
fast response for emergency vehicles.
12. +
Debt
Credit Cards: Keep a card for emergencies and pay off the rest.
Pay an extra amount each month toward your highest rate to
accelerate the process.
Be careful not to close them as this could shorten your credit history
and impact your credit score.
Remember that any credit you open in your joint names will remain
your joint responsibility. While any debt brought into the marriage
separately is your separate liability, it will definitely impact your monthly
expenses.
Student Loans: Continue to pay off any student loans and resist
taking a deferment unless absolutely necessary.
If either of you are planning to go back to school, make sure you
discuss the cost and impact on your household budget first. It may or
may not make sense depending on the long-term benefit.
13. +
Frivolous Items
As noted, there are usually many places we spend our
discretionary income on. But now that you’re a couple, these
expenses add up quickly when multiplied by two. Consider an
allowance or saving plan for these types of purchases:
Vacations
Clothes
New Appliances
Furniture
These items should only be purchased if there is room in the
budget after all necessities have been purchased.
15. +
A Savings Account
A savings account is an important part of adulthood as a
backup expense account.
As careful as we may plan, we can never know what is next –
whether your car breaks down, you have a medical emergency
or get laid off from your job.
This is money that should be allocated toward true
emergencies, not unplanned spending opportunities. Sit down
together and decide want constitutes an emergency and where
you may be at risk as a couple.
Having a savings account gives you a sense of power over
life’s unexpected events.
16. +
How much do I save?
Many say $100 dollars per month minimum; others say 10% of
each check should be set aside for savings only, not to be
touched unless there is an emergency.
How much do you spend per month? Times that by six, and
that will last you six months of unemployment. Many suggest
to have 6-12 months of expense money in your savings as a
back up plan.
Save what feels comfortable so you are not feeling deprived.
This can lead to unnecessary “raiding” of the savings account.
