When it comes to important areas of marriage that couples need to discuss regularly and that if not approached correctly can cause major issues, finances appear high on the list. For various reasons, many couples struggle to really get to grips with their finances and find it hard to be completely united in approaches. This is partly because of differing attitudes towards money and avoiding real planning around the finances of the family.
Particularly for new couples, sitting down and setting financial goals as a team can be a whole new skill set that they suddenly have to learn and learn quickly. You’ve spent a number of years managing (or not) your financial affairs and now there is this other person who is involved in your money. Oh Lord, it’s not even your money any more! It can take a bit of getting
To make what could become a very clinical exercise an opportunity to share, open up, come together and love on each other, Mr Chiwoko and I tend to turn our planning meetings into dates. We’ll go out for a meal in a restaurant that is well lit (we need to be able to write and it’s usually me who has the role of minute taker),
Right enough foreplay, let’s get into the meat of it.
What are our saving goals?
It’s 2019, a new year and a fresh opportunity to get some financial security behind you. Doesn’t matter if you feel like you are starting from ground zero with barely enough money in the savings to do a basic grocery shop at Tesco’s, this new year, sit down with your spouse and decide how much you would like to have in the bank by the end of 2019.
The trick here is to be realistic yet ambitious. No point setting a completely unachievable goal that is discouraging before you even start. Give yourself an amount that you actually believe that with enough effort you could smash and then add a few more pounds to it just to push yourself that little bit more.
When it comes to savings, a great 1st target is to make is to save enough money that if the worst comes and both you and your spouse are out of work, you have enough money in the bank to see you through for at least 3 months. Can you save that much in a year? if not, maybe start by saving enough to cover one person’s take-home pay for 3 months and then next year grow from there.
The next part is to consider what actions you are both going to take to achieve your saving goals.
- What are you going to cut back on?
- What bills can you potentially be paying less for or eliminate altogether?
- How frequently are you going not save and to which account?
- Do you have anything that you can sell and raise money from to add to your savings account?
- How can you find cheaper alternatives to family activities and entertainment?
How Do We Manage Everyday Spending on Household Purchases
This one takes a bit of self-reflection and honesty as well as a decision-making process as you will need to look at your current spending habits and decide whether it is working in favour of your family and future goals or not? Is your spending inactive and reactive? Or do you need to be a little more planned and proactive with your spending? Are you always looking for a cheap alternative but not considering quality and as a result you’re having to replace items more regularly? Are you considering the needs of the family and making decisions as to the best way to approach them on a daily basis?
One of your goals should be better management of everyday spending by ensuring that the areas that can be planned for are. For example, your finances will benefit from a weekly shopping budget that is in line with a meal plan. How about setting a monthly clothing allowance for the family and deciding each month what is needed as opposed to just coming across a nice jacket and reaching for the credit card without thinking.
Another great idea is to put a bit of ‘Just-In-Case’ money aside every month that only gets touched if the unexpected happens such as an unexpected school trip that suddenly requires you to buy a pair of wellies or you are suddenly required to put in a few pounds to contribute to a church initiative.
What’s The Approach If We Pay Off Our Accumulated Debt?
If you’re like me then there are some letters that you wish you could just bury and they would be forgotten about. Unfortunately, I have learnt over the years that debt is just one of those things that always finds you and gives you a big bite on the bum if you don’t face it head-on. As painful and often embarrassing as it can be, the best approach for you both as a couple is to be very open about any individual or collective debt that you have both acquired and decide on a plan of attack.
As a married couple, the wisest approach is to pull all your debt together and decide on how to tackle the whole sum as a team. Which debts will you focus on first? Are there any that can be consolidated? Which debts will you roll the money over to clear after the first one has been tackled? Whatever you decide, you need to get it sorted. Set yourself a goal to pay off one or more debts this year. It’s often advised to go with the debt that has the highest interest rates or greatest repercussion for late payment first as opposed to the biggest one. Also, bear in mind that even a small payment is still a payment. So a decision on which debts to pay larger amounts on and which debts to pay tiny amounts on until more funds become available is also important.
Don’t ignore debts and don’t hide them from each other either. It’s counterproductive and can cause a rif between the two of you. Remember that secret are not allowed in marriage – even financial secret.
Can We Make Any Investments?
While you are thinking about savings, why don’t you consider investments? Investments are something you buy or put your money into to get a profitable return. Now, please understand that this is something that Mr Chiwoko and I have started looking into and as we learn I will be sharing more with you on this topic but at this point, I just want to encourage you to start to really consider looking into investment portfolios, stocks and shares, even property. Savings accounts are great but the returns are nothing to get excited about. You’ve heard the term, ‘let your money work for you’, but the question is, how hard do you want it to work? Investments give you the opportunity to really make some exciting returns in the long term.
Beware though, they are not without their risks and so getting some good advice and starting off small might be a wise way to get started. But for sure do not think for one moment that investing is out of your reach or that it’s for people who are at certain financial level. You’ll be surprised at how little you can start with.
If you want to start to consider investments, here is a great place to start to learn about it. The Money Advice Service offers an impartial guide for beginners which you might find useful. Let me know what you think:
What Big Stuff Is Happening This Year?
There are so many things that happen throughout the year that we treat as if they were a complete surprise to us when we knew that they were coming. I used to this with school holidays! Half term holidays, end of term holidays, summer holidays and all the bank holidays in-between. They would come upon me and I’d be like, “Oh crap, it’s the holidays! What am I going to do with these kids?”
As well as suddenly having to come up with a load of activities to keep my 3 boys entertained for their weeks at home, I would also have to drastically increase my grocery shopping because the 3 hungry bears who eat like food is going out of fashion. And because all the activities that I suddenly have to come up with are last minute reactions, I end up panic planning and therefore spending a lot more money than I needed to – baring in mind that I hadn’t planned to spend this money! Crazy.
Well, this year things are about to change! I have made a note of all the school holidays and I’m planning way in advance what we will actually be doing. Even if we are doing nothing at all, let me plan to do nothing at all!
But it’s not just school holidays, it’s things like birthdays, weddings, date nights, weekends away. Do we need a new washing machine? Can we afford it this year? If not, what do we need to be saving this year to be able to do what we need to do in 2020?
We’ve just made it through Christmas, we know it is happening every year. Instead of leaving it until November until we start thinking about how we are going to finance the festivities and allowing ourselves to get completely stressed every year, how about we put a tiny bit aside every week or month towards it.
Basically, there are so many things that are out of our control and that we cannot foresee in order to plan against them. However, there are a load more things that we know are going to happen or at least we can make very informed guesstimates about. Save yourself a lot of money and stress.
How Will Regular Household Bills be Approached
Are you BOTH fully aware of all the household bills that you have and what the real cost of running the home is? If not, during your financial goal setting exercise, it would be a great idea to ensure that both of you are completely up to speed with all the bills of the household. Here a few decisions need to be made:
- Are you paying too much?
- Is that bill necessary – ie, if you are paying for Sky TV or another provider, do you really need the package that you are on or can you reduce it?
- Whose names are the bills in?
That last point is important to consider because it is a smart move to have bills with both names on as much as possible to assist with individual credit scores and identification purposes.
It’s also a wise idea to decide which account you want the bills to be paid out of. Having your bills come out of one central account can really help with financial management and accounting.
How Do We Handle Emergencies?
On eating about this life is that things happen. Jheez. You’re just plodding along in life feeling like you have everything under control. You planned, your prepped and you’ve double checked. Yet still, out for the blue comes this unexpected boulder ready to mess up everything you have planned. Yep, that’s life for you. I guess things would be pretty boring without the unexpected so we shouldn’t complain too much. However, as a married couple, things like huge unexpected bills and financial burdens can place an unwanted strain on our relationships – especially when they come with real set-backs.
So what can we do about the unexpected? Well, we don’t know what life is going to throw our way this year so we can’t plan for that, but we can be sure that there will definitely be some things that we just couldn’t foresee, so how about we plan for that? Let’s plan for the unexpected. Let’s be prepared for something to break down. Let’s be prepared for that random friend to suddenly announce that they’re getting married within the next month. Let’s prepare for the fact at some point either one of us is going to get a parking ticket. And we already know that the car is a little temperamental so…Oh, don’t forget we have children so literally ANYTHING could happen.
Mr Chiwoko and I have a ‘Just-In-Case’ pot as mentioned earlier that we put a little something in each month for those unexpected occurrences and trust me we are always so grateful that we have it there. Even if it doesn’t manage to cover the full expense of the unexpected, it does give us a little bit of a buffer. And hey, if we don’t use it for a few months then it just piles up and we thank God.
Right, What About Fun Money?
You’re right! Can’t be all about bills and the future – what about a little bit of fun for me today? Well, this is where you both need to consider allocating personal allowances. This is an amount that you both agree you each get and you can do whatever you like with. This is for coffee dates with your friends, your shopping splurges, your nail appointments, whatever you need to do that’s for you. How much you allocate to personal allowances really depends on how you set out your budget, how tight your saving plan is and what your monthly personal needs are.
Do not make the mistake of trying to live without this personal money because you will just find yourself breaking into your well planned out budget. You don’t want to deny yourself too much. What about family meals out or trips to the cinema?
My father always says that women need a larger personal allowance than men because we have some much more needs such as hair, make-up underwear and of course our monthlies. Gosh, it’s hard to be a woman. I naturally want to agree with that of course, but in the age of equality I will allow you to determine what works best for you as a couple.
I think that’s about it. If you can at least get the points I have mentioned here figured out then you are definitely on your way to having a financially successful year.
Final Word On Budgeting
For working out our family budget we use a great tool created by ‘Christians Against Poverty.’ I absolutely love this tool as it allows you to break things down into daily, weekly, monthly, bi-annual and annual expense and income categories. You will need to create an account in order to access the budgeting tool but it’s free and they don’t tend to bombard you with emails so don’t worry. It’s a lot easier then creating a spreadsheet yourself and you can print it off if you’re more of a paper person. Try it out and let me know what you think of it.
Please bear in mind that setting a budget is one thing, but actually sticking to it takes a level of discipline and commitment. Mr Chiwoko and I are putting our budget into prayer and asking God to give us the grace to be good stewards of His provisions and resources.
I hope you have found this useful. Mr Chiwoko and I are still using so if you have any useful tips for others and other people, feel free to pop them in the comments below.