Newlywed Finances

By Michael Peterson
In October 5, 2004

Ah, being a newlywed. Life is beautiful, your loved one is beautiful, and everything is peaches and cream. Well, in your mind and heart it may be, but the honeymoon has to end sometime. Two hearts are now joined as one, and so are your assets. It is time to start sorting out your finances as a couple.

In your single days, you were able to earn and spend as you please. Wanted a new TV? You bought one. Decided to sell your car? You sold it. But now you are part of a team, and your money decisions have to include your partner, too. Even right down to what brand of toilet paper you buy, your spending habits effect you as a couple from now on. Your significant other may not care whether you choose Angel Soft or Charmin, but he or she may care about the grocery bill.

Money problems are the number one cause for divorce. That’s because the transition into a shared financial life is not an easy one, no matter how deeply you are in love with your spouse. At the start of a marriage, a couple’s finances may not be totally stable, and to compound the problem, the tendency is to run out and buy stuff. You’re in such a happy time, and you just know that you’ll be able to pay off that plasma TV in a couple of months. Why wouldn’t you? Things are looking up and your life is going places. Unfortunately, one of the first places young newlyweds go is straight into debt. But it doesn’t have to be that way.

Common sense decisions from the beginning can keep your credit card debt low or non-existent and your money going towards mutual life goals. Here are a few tips on how to begin sharing your financial life together, saving money and spending wisely, as a team:

  1. Dine In
    When you were dating, romantic nights out on the town were the norm. But now that you have a lifetime together, you can start enjoying your new household by holding special romantic dinners at home. A little candle light, a little mood music, and even frozen dinner can be romantic–and cheaper!
  2. Shop Together
    You know how every time you go to the store, you wonder if you need milk? Your spouse does too, and one day, you will both come home with a gallon. Then you have way more milk than you can drink before the expiration date, and you’ve just wasted some money. Plus, strolling the aisles together can actually become a weekly “date night”.
  3. Keep a List
    Another way to avoid the milk snafu is to keep a list on the refrigerator door. When you find you are out of something, mark it on the list. The next person who goes to the store takes the list and buys whatever is needed. Then you start a new list. That way, things are not forgotten, and you won’t waste cell phone minutes with “Honey, are we out of pickles again?”

    On that list, make sure you mentioned what brand you want, if you want something specific. Your spouse loves you, but he or she may not notice what brand or flavor coffee you drink every morning (this is helpful for the 1st year until you know each others brand preferences).

  4. Housework Fun!
    Yes, sharing housework. It is part of marriage. Landscapers and maids cost money. But you can make housework fun if you do it together. Cleaning up after dinner is a great casual way to chat about your day. Saturday mornings or Sunday afternoons can be a wonderful time spent outdoors together, digging in the flowerbeds or installing a hammock. If you want to paint the master bedroom, do it together! It may be a little messy, but it can also be fun with the right attitude. And then you get to enjoy it together when you are done.
  5. Workout Together at Home
    Gym memberships are expensive. But now you have a built-in spotter and coach who can help you get in those last ten sit-ups or push-ups. Jog together or do sit-ups on the living room floor. Get that adrenaline pumping and your hearts will go aflutter.
  6. Skip the Movie Theater
    Movie tickets cost an arm and leg these days- and you can forget about popcorn and sodas. A night at the cinema for two can run you 50 bucks! Instead, rent a movie, pop some microwave popcorn, and snuggle up on the couch. Plus, watching a movie at home gives you a little more privacy for in-the-dark cuddling.
  7. Raid Mom’s Attic
    You may only be able to afford cardboard boxes and sagging couches for furniture as you start off your marriage, but we bet your parents might have a lot of handy items stored away in their attic that they’d be more than happy to lend you. Grandpa’s old chair? Great! Aunt Verna’s coffee table? Cool! It may not all match, but it works, plus it has the added sentimentality of coming from your family. Maybe you might even be able to use your very own old baby crib someday (don’t gasp, I said someday).

The Scary Numbers
Living frugally now means getting good stuff later. But what stuff? You two have to sit down and have a serious conversation about how each of you views your finances. What are you individual goals? What are your goals as a couple? Lay it down on paper. How much do you make? How much do you spend? How much do you need to get where you want to go? Whatever you do, don’t avoid planning your finances.

But that all-important conversation shouldn’t just be about goals. It is time to come clean to each other about everything–student loans, credit card debt, various secret overseas accounts, everything. It is time for total disclosure. You don’t want one spouse to secretly have bad credit and when it comes time to apply for a mortgage–surprise, you’re denied! It all has to be on the table now, so it can be handled accordingly.

Joint checking accounts make perfect sense when it comes to shared expenses such as utility bills, grocery bills, and mortgage bills. They also help each of you to better understand your new “family” financial situation. Make sure that you spend a little time together each week going over the expenses and consolidating the income and outgo for the account. In order to succeed financially as a couple you need to work together to understand your goals and limitations. Also, remember to include in your budget some “mad money” every month for each of you. This is money that is yours to spend on whatever you want without worrying about going over budget (and without having to check with your spouse first).

Newlywed couples have a lifetime ahead of them–a lifetime full of fun, happiness, babies, college tuitions, retirement, medical bills, and possibly nursing home stays. Now is the time to start planning for those future expenses by setting up a special fund for emergency cash reserves in the event of the unexpected. It’s time to set up a savings fund for your future children’s college education.

And even though it seems a long way off, it’s time to start saving for retirement. Whether a 401(k), mutual funds, IRA’s, or special investments, young couples can start saving now so that 40 years from now they can be relaxing on the beach, reminiscing over a wonderful four decades together, and planning for the fun to come.

Mike is the author of “Reality Millionaire: Proven Tips to Retire Rich” and he has been published in a variety of local and national publications including Entrepreneur Magazine, Deseret Morning News, LDS Living Magazine, and Physicians Money Digest. He holds a B.S. in business administration from the University of Phoenix.

Click "More" for important American Credit Foundation client transition information