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Money & Finance Today

Money is big part of marriage because it is practically impossible to marry someone and not have your finances mix up with theirs. Interestingly, the Institute for Divorce Financial Analysis submits that money problems was the cause of 22% of divorces. Many people who have promised to love each other through thick and thin will often start to question the sanity of their decisions when the bills start piling up and it seems that their partner is the cause of the financial mess.

However, you don't need to fold your hands while money matters take the love out of your marriage. Here are four proactive steps you can take to keep you marriage above financial waters.





1. Start with full disclosure of the finances of both parties


When businesses want to go through mergers and acquisitions, they usually ask for full disclosure on some financial metrics. When you want to invest in a company, you'll most likely ask for full disclosure on their books. Likewise, when you want to marry someone, there should be full disclosure on the financial situation of both parties. In fact, full disclosure should be the standard if you plan to combine finances in marriage.

In disclosing your financial situation (and knowing the financial situation of your spouse), you should know about student loans, outstanding debts, and other financial obligations. There should also be full disclosure on income sources, assets, and other investments.


2. Don't start your marital finances on the wrong foot


Many couple set up their marital finances up for failure from the start by spending more than they can afford on marriage festivities. I know that you love your partner; I know that you want to show the whole world the depth of your love, and I know that no cost should be spared in declaring your love. However, the wedding is only one day and the marriage continues for many years after.

If you spend the money you don't have on a single day of festivities, you'll be drowning in debt by the time you return from your honeymoon. You should avoid going into debt to pay for your wedding because the size of your wedding doesn’t necessary represent the depth of your love and commitment to your spouse.


3. Know your partner's belief system about money


People have different beliefs on how money should be handled, managed, spent, saved, and invested. You need to know and understand your partner's philosophy about money in order to avoid unnecessary conflicts of interest on your finances. To start with, you need to know if you are a cheapskate, frugal, or big spender and know what your partner thinks about your money mindset.

More importantly, you need to discuss your biggest money worries and your loftiest financial goals in order to ensure that you are working towards the same or complementary goals.


4. Create a budget together and stick to it


Smart personal finance education teaches the importance of creating a financial budget in order to ensure that your expenses are not more than your income. In marriage, you'll also need to create a family budget to ensure that you know where you money is going. In making a household budget, it is ideal that both partners are involved in the budgeting process even if the actual task of paying the bills and balancing the checkbook will fall on one partner. More importantly, you need to ensure that you stick to the family budget and there should be mutual agreement when any item on the budget needs a significant change.


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