Learning to say “I do” to financial planning may not be nearly as exciting as planning your big day. But doing so sooner rather than later can save you and your partner a lot of time, stress, and, of course, money. Money problems are one of the leading causes of divorce , after all.
Finances for newlyweds can encompass an array of topics, ranging from basic budgeting to planning for a child (or a dog!). So to help you and your partner make the right money moves early on in your marriage, we’ve put together this list of tips to help you start your newlywed financial planning.
1. Discussing Money Motivations
To jumpstart your newlywed financial planning, you may want to start off by discussing your money motivations. This can mean both understanding how money motivates you and why you want money. For instance, do you enjoy treating yourself to a nice meal after you accomplish a goal? Or does your partner collect coins or make pottery (both of which can be expensive)? It can be important to understand how each of you want to spend the money you make, such as investing, funding a hobby, or buying takeout on payday. Being on the same page about your motivations can help you avoid fighting over money.
2. Setting a Budget
Once you understand each others’ money motivations, it may be a good time to start budgeting. To make a monthly budget, you and your partner will need to know what your income is versus what your expenses are. If you have more expenses than money coming in, you should talk to determine where you can make cuts to keep your budget balanced. After you agree on your budget, discussing how you can help each other keep to the budget so you can stay financially secure could be a great next step.
3. Laying Out Financial Goals
Setting financial goals may help you and your partner stay on budget. Are you hoping to pay off debts? Do you want to build up your savings? Or maybe you want to build your credit to increase your odds of getting a good rate on a home loan. No matter what your financial goals are, being on the same page can help increase your chances of succeeding. And if you need help keeping your finances in order, you may want to check out these tips for staying organized on your journey to reaching your newlywed financial goals.
4. Being Honest About Existing Debts & Student Loans
Most graduates are leaving college with student loan debt. If you or your partner (or perhaps both of you) are in this position, you may want to have an honest talk about just how much each of you owes and what your repayment obligations are, such as monthly payments and interest rates. You can’t combine your student loan balances; however, you may decide it may be worth trying to refinance your student loans to try and lower interest rates. While you’re being honest, you may also want to talk through other existing debts, such as credit cards, car loans and personal loans. These debts could impact your financial goals or budgets, especially if you have any loans that are in deferment or grace periods that will soon end.
5. Making a Master List of Assets & Liabilities
After discussing your debts and how much you each owe, you may want to start a master list to help you keep track of them. Be sure to also track assets like cash or cryptos. Having a master list of both your assets and liabilities can help you create a combined financial statement , which can in return help you keep better track of your finances and budget.
6. Deciding Whether or Not to Combine Accounts
Now that you know how much in assets and liabilities each of you have, you may want to carefully consider which financial accounts you combine, if any. For instance, if one partner has a low credit score or a lot of debt, it may be wise to keep separate accounts , especially if you’re concerned about how it may affect your combined ability to get a loan or apply for a mortgage. You may also opt to have some combined accounts and some separate. For instance, you may want to have a combined checking and savings account and separate checking accounts. No matter what you decide, you could avoid a lot of hurt (both financially and emotionally) by being honest with each other about whether combining accounts really makes sense for you and your financial goals.
7. Planning for Big Ticket Expenses
While you may opt to live a dual income, no kids lifestyle for now, you and your partner may decide to become parents down the road. You might also want to start a business, go back to school, buy a home, or even retire early – all goals that are going to require both of you to start saving now. Discussing whether either of you have big-ticket expenses planned for the future, or if you have one combined, can help you start planning and saving now. And if you need some help jumpstarting your ability to pay for those big ticket expenses, you may want to consider getting a personal loan, such as SoFi’s personal loans for family planning.
8. Creating an Emergency Fund
Once you have a firm grasp of your financial obligations and goals, you could start digging into other financial needs, such as an emergency fund. Home repairs, car troubles, or a trip to the ER could end up costing you big. Yet 51% of Americans have less than three months’ worth of emergency savings. You and your partner may want to talk about how much in savings you already have, how much of that can go toward starting an emergency fund (if you don’t already have one), and how much both of you would need combined to cover a month’s worth of expenses in case of an emergency. Whatever that number is, multiply it by three, and that may be a good starting goal. Once achieved, you can continue saving toward a more complete emergency fund that can contain as many as 12 months worth of spending.
9. Discussing Insurance Options
While newlyweds may not want to talk about what could happen if a spouse is seriously injured, becomes disabled, or even dies, this conversation is important to have early in your marriage. Your spouse and family could be left with a huge financial burden if neither of you has life insurance. You’ll also want to consider discussing health insurance coverage in case of a medical emergency. This process would likely involve reviewing if your insurance needs have changed now that you’re married, such as needing to add your spouse to your work-sponsored insurance plan.
10. Determining if Investing Makes Sense
Investing could be a great way to help you and your partner create some wiggle room in your newlywed financial budget (assuming you invest wisely!). If you or your partner have investments or have invested in the past, you may want to discuss what you invested in, your risk tolerances, and your investment goals. If your risk tolerances are similar and investing makes sense for your financial situation and goals, you could consider investing as a couple.
11. Understanding Each Others’ Money Habits
Do you think buying organic is worth the few extra dollars? Are hair appointments a must for your partner? You may want to have a conversation with your partner about your spending habits to avoid any surprises that could ruin your budget. This could be especially important to do if you both have different spending habits, such as one being more frugal than the other. Understanding and planning for each others’ money habits early on could help you avoid money fights down the road.
12. Setting Spending Limits
While it’s likely you’ll both have discretionary expenses, it could be smart to have a dollar amount at which you will check in with the other before spending more than an agreed-upon amount of money. Setting a spending limit could help you and your partner stay on budget and ensure that financial talks are a natural part of your relationship. Spending limits could also help you both fight against lifestyle creep, especially if combining your finances has drastically changed how much money is at your disposal.
13. Being on the Same Page About Loaning Money
Your sister needs you to pick up the bill at lunch because she forgot her wallet but promises to pay you back later. A cousin asks for a loan to help pay for car repairs. Everyone has different levels of comfort with loaning money to family and friends. You may want to check with your partner about their comfort level with loaning money as they might have a zero-tolerance stance due to a bad experience. And if you both decide that you are willing to loan money to friends and family, it may be wise to set a loan limit and outline clear expectations such as a date when you expect to be paid back, if you’ll be charging interest, and any other contingencies you may have for the loan.
14. Making Time for Regular Money Talks
After you’ve hashed out the nitty-gritty of your newlywed financial plans and goals, it’s equally important to check in regularly about the state of your finances. Your budget or goals may need to change with time, especially if your work status changes (for better or for worse!) or you experience an emergency. It may not always be pleasant or fun, but making money talks a priority can save you both a lot of time, money, and heartache later on.
15. Talking with the Experts
As you establish your financial goals and budget, it may be wise to consult a financial or wealth management advisor. An expert can share valuable insight into how you can best reach your financial goals by taking an honest, unbiased look at your finances. You may even be able to find a financial advisor who offers services specific to newlywed financial planning and budgeting. While paying for an expert may be an added upfront expense, their advice could end up paying for itself.
Now that the honeymoon’s over, it may be time to talk money. Being on the same page about financial goals could help you and your partner avoid making costly mistakes, both in terms of your finances and your relationship. And being honest with each other about your debts and financial goals could bring you even closer together.
If your newlywed financial planning could use some help, a high interest bank account could be right for you! Saying “I do” to SoFi Checking and Savings won’t cost you a penny, and could help you earn a great APY.
Photo credit: iStock/Prostock-Studio
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.