Any married couple will tell you that budget planning doesn't end after your wedding day. Sure, throwing a big party with your friends and family is a priority, but you're also entering a mutual agreement to share your entire life with someone else. Having spent your pre-marriage days in an individual mindset, it's natural to neglect some key practices when consolidating into one financial entity with your spouse. Here are the five biggest budget mistakes commonly made by newlyweds as they become familiar with doubling down on their shared financial future.
- Planning for the short- or long-term, but not both.
Planning your wedding is a short-term objective, whereas writing the details of your family estate is more of a long-term plan. Both ends of the timeline are important, but it's most effective to start planning for your future now. Too many couples make the mistake of having a single, short-term financial strategy, or struggling month-to-month by setting unattainable goals. Acknowledge everything from your immediate budget and expenses to your retirement strategy. Be proactive and organize your current finances while establishing future plans. If you want some help understanding how to make today’s money set the course for tomorrow, speak to an expert about setting the right goals and starting to work towards them.
- Thinking as an individual rather than a couple.
Embrace your new life as a two-person unit as soon as you're married, if not before. If you've been comfortable controlling your finances as an individual, you need to shift gears and start thinking as a financial partnership with your spouse. Consider opening a shared bank account exclusively for your combined daily spending habits in order to meet your budgeting goals. Communicate openly to see where one of you can manage a responsibility for both of you. This approach will save you time, improve your budgeting, and help maximize your earnings by working together to save more—and spending together to pay less.
- Contrasting opinions on investing.
You may think it's a great idea to finance a second car, while your spouse argues that real estate is a better purchase. Try to meet in the middle and agree on investments that will benefit your future together. Look beyond physical purchases to equity, fixed income investments, financial products that may offer long-term growth and value. Before deciding on a financial strategy, support each other and discuss the possible cost, fees, opportunities, and risk. No matter how things play out in the long-term, it's crucial to stand together and believe in your investments.
- Purchasing before getting multiple quotes.
Your new life as a married couple requires new joint assets. Whether you're making a decision on homeowners' insurance, paying a brokerage fee on an apartment rental, or signing a contract for a new cable package, you should always shop around and find the best offer that fits your needs. You and your spouse may have contrasting credit scores, so look at the numbers and work together to pay down debt or earn approvals on purchases in order to move your finances forward.
- Paying for services separately when you could be paying together.
Now that you're a financial duo, working together to consolidate your combined overhead is a great opportunity to save money. You only need one Netflix account for both of you and it's often cheaper to switch to a family phone plan with a shared provider. Make a list with your spouse of all your combined monthly costs and see where you can cut some excess spending.