When couples get married or move in together, they naturally take shared responsibility for each other along with their finances. But misunderstandings about money can’t be avoided, often resulting in strained relationships. Following practical and sound saving tips for couples can help iron out the most common money problems. Still, financial plans should be laid out early on to avoid any future tension in the relationship.
One of the most important and urgent matters that you and your partner should settle from the get-go is how to split your finances. How should you manage your expenses and save up for your goals? There’s no one-size-fits-all rule, so here are some financial tips for couples to help you out.
Effective Saving Tips for Couples
It may surprise you that you and your partner get along with everything, except with money matters. This doesn't mean you need to break up or that you're going to be financially miserable together. You can succeed financially together by doing the following.
1. Understand Each Other’s Money Personality
The key to good financial health and a smooth-sailing relationship is knowing and understanding each other’s views and behavior towards money. Discover your money personality as well as your partner’s. If you know what to expect, you can make compromises, and there won’t be as many unpleasant surprises along the way.
|Go for moderate savings so you won’t sacrifice things that reward your hard work.|
You and your partner may not necessarily fall into these categories, but you can check out how a few things can be resolved or improved.
Knowing your money personality is one useful savings tip for couples that can help you understand your actions to avoid making further mistakes in the future.
Read more: 5 Signs of Financial Compatibility
2. Set Your Financial Goals Together
One of the most important financial tips for couples is talking about your financial goals. Identify what you want to achieve together and how you’ll get there. Here are some considerations you must discuss with your partner:
- How to budget your daily household expenses
- Splitting of living expenses and bills
- Ways to pay off debts accumulated separately or together
- How to handle financial emergencies
- Saving and investment strategies
But before you can do this, there are several things you need to settle together as a couple.
Identify the Pain Points
Do you have outstanding debts at the beginning of your relationship? Did you apply for a loan to pay off your car or home down payment? Do you worry about your different earning capacities and spending habits? Identifying the pain points in your finances will also help set your couple financial goals.
Read more: Is your spouse drowned in debt? Read this.
Categorize Your Expenses
Not all expenses are shared. But electricity bills, groceries, and travel can be considered shared expenses. On the other hand, individual expenses can include new clothes, money you send back home to your parents, and repayment for debts incurred before you two got together. Identifying your expenses can trim down the complexity of money management for couples.
Sort Your Goals and Problems
What’s achievable or doable for you and your partner in the long term? What financial problems can be resolved immediately? For instance, will the issue of different earning capacities be resolved if you put up a small business together? Can you encourage your partner or spouse to look for other streams of income?
Create a Budget Plan
A budget plan can help you stay on top of your expenses. Designate an amount you can spend for goods, take-outs, entertainment, and personal expenses. Include your bills, other debt obligations, irregular expenses, and money for your emergency fund in the budget plan. This is one of the best saving tips for couples who want to be on top of their expenses.
Make an Action Plan
You’ve sorted out your pain points, expenses, and financial goals. Now it’s time to create an action plan on how these problems can be resolved and how the financial goals can be realized. Your action plan should include a timeline and a favorable action, like the following:
- Opening joint savings account
- Building another source of income
- Gradually paying small debts
- Checking your investment options
- Planning big purchases
3. Find a Money Management Strategy that Works
Decide on a strategy for managing your money together based on your shared financial goals. Consider these five money strategies when exploring the way to share finances as a couple:
- Keeping your finances separate
- Combining finances completely
- Managing joint and individual accounts
- Living off of a spouse’s income
- Living off of a spouse’s income and saving the other’s income
|Keeping your finances separate||You and your partner have a clear idea on how much to share each month and how much of your total earnings will be left for your individual needs.||Undisclosed earnings may be a problem, especially if there are debts that need to be paid. One partner can claim insufficient earnings. In this case, the other may be forced to cover for the deficit all the time.|
|Combining finances completely||You get an idea of your total income together.||Since you and your partner may have different earning capacities, the one with the higher income might see it as unfair.|
Managing joint and individual accounts
|You and your partner have visibility on savings and expenses.||Managing multiple accounts can be taxing and time-consuming.|
|Living off of a partner’s income||Unless voluntarily, the partner with the higher income can cover all expenses.||Shouldering expenses alone can be a stressful obligation for the partner-in-charge of all the expenses.|
|Living off of a partner’s income and saving the other’s income||Sounds like an ideal savings tip for couples. There’s a clear boundary of what you can spend and what needs to be saved.||If one partner's income doesn't come as expected, then either your savings or your expenses may be compromised.|
Deciding on the best money management strategy depends on your preference, priorities, current income, and other obligations outside of your relationship. Some couples may still have to provide for their nuclear family’s needs, like sending their siblings to school or paying for their parents’ utility bills. But regardless of what strategy you choose, you need to mutually agree on it and honor the agreement no matter what.
4. Identify Needs Vs. Wants
Sit down with your partner and determine your needs and wants as a couple. Make sure that you both agree on what you can and can’t live without. Compromises are important in any relationship. If the other person isn’t fully on-board, discuss why and how you can create a middle ground. Also, allot a small amount to treat yourselves.
5. Set Guidelines for Spending
You may want to watch a movie this weekend, but your partner prefers to stay at home and binge watch on a streaming service. Maybe you prefer to save for a summer getaway, which your partner isn’t too keen about because they’d rather save the money for a special occasion.
Frequent or repetitive disagreements on spending can take a toll on your relationship, so set some spending guidelines. For example, you both can agree to dine out twice a month or to travel once every three months. You can also agree to buy household appliances at a certain price limit you both agreed upon.
Ultimately, setting guidelines for spending can help make your financial planning a lot easier.
6. Maximize Your Benefits
Know each other’s company-sponsored benefits, (e.g., HMO and benefits for dependents), government-mandated benefits (e.g., PhilHealth and SSS maternity benefits), and life insurance policies. Discuss how you can maximize them to save money when one of you gets hospitalized. Make sure to enroll each other (and future kids) as dependents, if possible.
7. Discuss Job Security
Because of the pandemic, about 45% of adult workers lost their jobs. Talk with your partner about handling your finances when unemployment strikes. Create a financial blueprint and discuss how you can cut back on expenses and what plans involving money can be delayed. While no one wants to lose their job, it’s still best to be prepared should it happen.
8. Decide If You’re Financially Ready to Have Kids
Raising children is fulfilling but can also drain your finances. You also have to prepare for your kids’ living expenses, medical needs, and education. Discuss with your partner about having kids—whether you can afford to have one or not right now. This is one of the best financial tips for couples who are planning to start a family soon.
9. Establish an Emergency Fund
Build an emergency fund for unexpected events such as losing your job, your car breaking down, or a trip to the hospital. Experts suggest saving three to six months’ worth of living expenses. In addition, make sure your emergency fund is easily accessible by both of you. Why not keep it in a joint savings bank account where it can grow?
10. Review Your Finances Regularly
Discuss your budget, income, and spending at least once a month. Talk about how your budget looks like and if your money management system is helping you achieve your financial goals. These meetings can help you identify what you can do to improve your finances. It can also help strengthen your communication and trust level, knowing that you got each other’s back.
These financial tips for couples aren’t the end-all-and-be-all of money management. Don’t let budgeting cause a strain on your relationship. Communicating your needs and thoughts while creating a budget plan can help in customizing your money management strategies.
Moreover, there are a lot of savings tips for couples out there. But no matter how well you manage your finances together, you may still face a few hurdles along the way. It takes open communication, honesty, sincerity, and the willingness to compromise to let you both achieve your couple financial goals.
This article also appeared in The Manila Times.
-  Money and marriage— managing your costs as a couple (N26.com, 2022)
-  Six financial personality types — which one are you? (Financial Times, 2022)