ARTICLES

Marriage is an important milestone in everyone’s life. It involves new beginnings, setting up a new family, and getting a companion by your side through life’s thick and thin. Knowing your spouse is a part of marriage, not just each other's habits, vices, and preferences, but also finances. 

Sounds uncomfortable? 

Money conversations usually seem so but if you don’t open up with your spouse, whom would you open up with. Getting to know your spouse’s finances and sharing yours is also an important aspect of your partnership. It helps you figure out your family’s finances and how you can, together, build up a suitable portfolio for your family’s financial needs. 

So, with this sentiment in mind, here are some important money conversations that you should have with your better half –

Discuss the different and the possible sources of income

First and foremost, identify each other's sources of income. This gives you an idea of the aggregate income that both of you can contribute to the household which can, then, be apportioned across expenses and investments. 

Moreover, knowing the aggregate income also helps you plan a budget and plan your lifestyle needs. So, find out your and your spouse’s source of income, both primary and ancillary. Remember, an open conversation from the very beginning is very healthy!

The average household expenses

This is the obvious next step. After you have worked out the income, it is time to figure out your expenses. Find out your spouse’s personal expenses as well as the expected expense on the household. You should also include the lifestyle expenses incurred on entertainment, vacations, dining out, etc. in the overall budget and understand each other’s spending habits.

Remember to share your personal expenses with your future spouse for a transparent financial picture.  

Discuss your current dependents 

Figure out how many family members depend on each of you for their expenses. If your spouse has dependent parents or siblings, his disposable income would be affected. 

Similarly, if your family members depend on your income, your disposable savings would reduce. Though things might change after marriage, having an idea of the existing and expected dependents would help you plan your finances after marriage. 

Discuss your existing liabilities and loans

Liabilities eat into your incomes and remain a concurrent expense until they are paid. Thus, when talking about finances, knowledge of existing liabilities is very important. Talk about the existing debts that each of you might have. Also, assess the outstanding liability and the remaining repayment tenure to find out how soon you can go debt-free. 

If either of you has any high-interest loans, you can work towards repaying them at the earliest by combining your incomes. Knowledge of existing liabilities would also help you plan for future ones which you might need to fulfill your financial goals.

Chalk out your financial goals together– both practical and not-so-practical

Many couples often confide their dreams and aspirations in each other. You might want to build up your dream home or ensure an international education for your children. This conversation, though natural, should be discussed openly. Communicate your dreams and aspirations with your spouse. Know about his goals too. 

Identification of goals is the first step towards financial planning. As such, when you discuss your goals, you can plan your financial portfolio around them after marriage. For example, if you and your spouse decide to invest in a car after marriage, you need to assess when you would be making the purchase and the funds required for the same. So share your aspirations, however grand they might seem. If you plan right, you can achieve your dreams.

Plan your investments together, keeping the financial goals in mind

Talk to your future spouse about investments. Find out how much he/she knows about the investment avenues available and share in your knowledge too. Discuss which investments you would be making after marriage to start planning for your family’s financial goals. Pre-planning never hurt anyone but a delay or failure of the same did. 

So, if you want to start your financial journey on the right foot, talk about investments, even though they would be done in the future. Align your financial interests and decide on the investments that you would be making for your family and its goals. 

Discuss nominations 

Almost every financial account requires nomination. Nomination is when you nominate an individual to receive the money from the financial account after your demise. Before marriage, individuals usually nominate either of their parents. However, after marriage, the nominee is, usually, the spouse. 
Also, you can hold your bank accounts and other investments in joint names wherein the withdrawal can be made by anyone or by the last surviving member. This would ensure that in the case of unfortunate events, either you or your spouse can access the funds when needed. 

So, discuss the existing nomination details with your spouse. Also, keep in mind that any changes made in the nomination details, it should be communicated to both of you. It is important to be updated.

Financial literacy is very important to achieve financial freedom. Most often than not, the prerogative or obligation to become financially literate and knowledgeable rests on the shoulders of the husband. However, the scenario is changing now as women are also becoming financially empowered.
Today’s career-oriented woman has a say in her finances. Moreover, marriage is a partnership of equals, even where finances are concerned. So, when getting to know your future spouse, be financially open with him/her. Discuss your finances and find out theirs as well so that the financial foundation of your marriage is transparent and built by both of you.