Money Matters for Newlyweds

Tips on how to live out the "for richer or for poorer" part of your vows, through proper money management.

Money management can actually be a fulfilling way to bond with your spouse. Here are some steps to get you started on how to properly deal with your finances.

On Combining financial resources

1. Own Up
Lay down every financial aspect of your life to each other. Identify and explain sources of income, detail all your assets, and confess any debts you may have incurred.

2. Look at the Numbers
Tally all the assets that you have together. This includes all your savings, checking accounts, real estate, insurance, and investments. Then, subtract all the debts you have, such as credit card debts, or loans. The result is your net worth.

3. Balance It Out
Plan on how to address your debt issues, and how to allot your assets. Make sure that you prioritize getting out of debt first, before making any further investments or extravagant purchases.

On Sharing Expenses

1. List Your Expenses
What do you spend money on? Jot down essentials such as rent, transportation, bills, utilities, and groceries. Next, write down your discretionary spending, or items that you both agree you will allot money to. This includes personal shopping, entertainment, gym membership, and hobbies.

2. Set Financial Goals
Financial advisers recommend three kinds of financial goals: emergency funds (setting aside three to six months worth of your monthly spending), short term goals (such as a trip abroad, or a down payment for a car), and long term goals (such as children's educational plan, or your retirement).

3. Decide on How to Allot Income
Will you combine your income and budget accordingly? Or will the husband be in charge of long term financial goals, while the wife's income goes to monthly expenses? Whose income will contribute to your emergency fund or savings? It's up to you to decide.

On Keeping Personal Accounts

1. Set a Limit
Set a ceiling for the amount of money that each of you can spend without having to consult the other. For example, you can say something like, purchases over PhP 5,000 need to be a joint decision. Anything less will be up to each other's discretion.

2. Keep Tabs
As much as possible, keep receipts of your purchases in order to account for your spending. Or use one of the many budgeting apps available to tally and keep track of your spending. Then decide who gets to do the accounting of your earnings and expenses. This way, you will have a picture of where you are overspending or under spending, and adjust accordingly.

3. Agree on Accounts
As a couple, you can have all joint accounts, a combination of joint and separate accounts, or entirely separate accounts. This is again up to you, and what you believe will work best for you as a couple. Most couples use a combination of personal and separate accounts.